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Finance Committee pauses consideration of Uniform Special Deposit amendment to UCC bill 206
Summary
Lawyers and legislative counsel described a model "Uniform Special Deposit" law that would let banks offer protected third‑party deposit accounts; committee members asked for more review and agreed to postpone action until next week.
The Finance Committee postponed consideration of an amendment that would add the Uniform Special Deposit Act to House bill 206, the Uniform Commercial Code measure, after members said the model law is new and needs further vetting.
The amendment would let banks opt to offer a "special deposit" account that holds funds that legally belong to a third party (for example, earnest money in a real estate brokerage escrow or a tenant security deposit) and protects those funds from the depositor’s creditors and from setoff by the bank, provided a signed written agreement and a permissible purpose are documented.
Carl Lisonbee, a lawyer and Uniform Law Commissioner, told the committee, "No bank would be required to do these things. But if it chose to do them, it would ... be helpful to the you and the me of Vermont who might get the benefit of a special deposit." Lisonbee described typical uses as brokerage earnest money, escrow…
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