Iowa Code 554.9340 – Effectiveness of right of recoupment or setoff against deposit account
Except as otherwise provided in subsection 3, a bank with which a deposit account is maintained may exercise any right of recoupment or setoff against a secured party that holds a security interest in the deposit account.
Terms Used In Iowa Code 554.9340
- Account: means the same as defined in section 554. See Iowa Code 554E.1
- Deposit account: means the same as defined in section 554. See Iowa Code 554E.1
Except as otherwise provided in subsection 3, the application of this Article to a security interest in a deposit account does not affect a right of recoupment or setoff of the secured party as to a deposit account maintained with the secured party.
The exercise by a bank of a setoff against a deposit account is ineffective against a secured party that holds a security interest in the deposit account which is perfected by control under section 554.9104, subsection 1, paragraph “c”, if the setoff is based on a claim against the debtor.