12 C.F.R. § 330.11

Accounts of a corporation, partnership or unincorporated association

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(a) Corporate accounts. (1) The deposit accounts of a corporation engaged in any “independent activity” (as defined in § 330.1(g)) shall be added together and insured up to the SMDIA in the aggregate. If a corporation has divisions or units which are not separately incorporated, the deposit accounts of those divisions or units shall be added to any other deposit accounts of the corporation. If a corporation maintains deposit accounts in a representative or fiduciary capacity, such accounts shall not be treated as the deposit accounts of the corporation but shall be treated as fiduciary accounts and insured in accordance with the provisions of § 330.7.

(2) Notwithstanding any other provision of this part, any trust or other business arrangement which has filed or is required to file a registration statement with the Securities and Exchange Commission pursuant to section 8 of the Investment Company Act of 1940 (15 U.S.C. 80a-8) or that would be required so to register but for the fact it is not created under the laws of the United States or a state or but for sections 2(b), 3(c)(1), or 6(a)(1) of that act shall be deemed to be a corporation for purposes of determining deposit insurance coverage. An exception to this paragraph (a)(2) shall exist for any trust or other business arrangement established by a state or that is a state agency or state public instrumentality as part of a qualified tuition savings program under section 529 of the Internal Revenue Code (26 U.S.C. 529). A deposit account of such a trust or business arrangement shall not be deemed to be the deposit of a corporation provided that: The funds in the account may be traced to one or more particular investors or participants; and the existence of the trust relationships is disclosed in accordance with the requirements of § 330.5. If these conditions are satisfied, each participant's funds shall be insured as a deposit account of the participant.

(b) Partnership accounts. The deposit accounts of a partnership engaged in any “independent activity” (as defined in § 330.1(g)) shall be added together and insured up to the SMDIA in the aggregate. Such insurance coverage shall be separate from any insurance provided for individually owned (single ownership) accounts maintained by the individual partners. A partnership shall be deemed to exist, for purposes of this paragraph, any time there is an association of two or more persons or entities formed to carry on, as co-owners, an unincorporated business for profit.

(c) Unincorporated association accounts. The deposit accounts of an unincorporated association engaged in any independent activity shall be added together and insured up to the SMDIA in the aggregate, separately from the accounts of the person(s) or entity(ies) comprising the unincorporated association. An unincorporated association shall be deemed to exist, for purposes of this paragraph, whenever there is an association of two or more persons formed for some religious, educational, charitable, social or other noncommercial purpose.

(d) Non-qualifying entities. The deposit accounts of an entity which is not engaged in an “independent activity” (as defined in § 330.1(g)) shall be deemed to be owned by the person or persons owning the corporation or comprising the partnership or unincorporated association, and, for deposit insurance purposes, the interest of each person in such a deposit account shall be added to any other deposit accounts individually owned by that person and insured up to the SMDIA in the aggregate.

[63 FR 25756, May 11, 1998, as amended at 70 FR 33692, June 9, 2005; 70 FR 62059, Oct. 28, 2005; 71 FR 14631, Mar. 23, 2006]

Notes of Decisions

Cited in 6 cases, 1984–2011 · leading case: Adagio Inv. Holding Ltd. v. Fed. Deposit Ins., 338 F. Supp. 2d 71 (D.D.C. 2004).

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Adagio Inv. Holding Ltd. v. Fed. Deposit Ins., 338 F. Supp. 2d 71 (D.D.C. 2004). · cites it 2× “§ 1821 (a)(1); 12 C.F.R. § 330.11 . 3 . IBFs are established pursuant to Federal Reserve regulations; they may only contain international funds that do not directly affect domestic financial markets.”

Suzan Tantleff Trusts v. Fed. Deposit Ins., 938 F. Supp. 14 (D.D.C. 1996). · cites it 4× “” 12 C.F.R. § 330.11 (a). A trust interest is noncontingent if it is “capable of determination without evaluation of contingencies” except for those covered by present worth or life expectancy tables used by the Internal Revenue Service.”

Aviva Life & Annuity Co. v. Fed. Deposit Ins., 654 F.3d 1129 (10th Cir. 2011). “Shortly after its appointment as receiver, the FDIC determined that Plaintiffs’ respective accounts identified as “operating” accounts, which included the Challenged Accounts, would be aggregated as corporate accounts pursuant to 12 C.F.R. § 330.11 . The FDIC further determined…”

Philadelphia Gear Corp v. Fed. Deposit Ins., 751 F.2d 1131 (10th Cir. 1984). · cites it 3× “See 12 C.F.R. § 330.11 . 4 As previously discussed, both commercial and standby letters represent primary bank liabilities.”

Fed. Deposit Ins. v. McKnight, 769 F.2d 658 (10th Cir. 1985). “Therefore, in its capacity as insurer, FDIC was required to pay each of the debts represented by the cashier’s checks as insured deposits in accordance with § 1813(Z)(4) and 12 C.F.R. § 330.11 . Payment of any sums in excess of the insured amounts, however, would be contrary to…”

Abrams v. Fed. Deposit Ins., 938 F.2d 22 (2d Cir. 1991). “After months of silence, the FDIC finally on March 7, 1991, informed the Attorney General in a two-page letter that, in its view, Freedom Bank’s not-for-profit depositors did not hold their assets as “trust funds” or “trust interests” for beneficiaries under 12 C.F.R. § 330.11 ,…”

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