A. No savings institution shall pay an overdraft of an officer, director, or employee of the institution on any account at the institution unless the payment of funds is made in accordance with (i) a written, preauthorized, interest-bearing extension of credit plan that specifies a method of repayment or (ii) a written, preauthorized transfer of funds from another account of the account holder at the institution.

Terms Used In Virginia Code 6.2-1129

  • Account: means any account with a savings institution and includes a checking, time, interest, or savings account. See Virginia Code 6.2-1100
  • Savings institution: means a savings and loan association, a building and loan association, or savings bank, whether organized as a capital stock corporation or a nonstock corporation, that is authorized by law to accept deposits and to hold itself out to the public as engaged in the savings institution business. See Virginia Code 6.2-1100

B. The prohibition set forth in subsection A does not apply to the payment of inadvertent overdrafts on an account in an aggregate amount of $1,000 or less if (i) the account is not overdrawn for more than five business days and (ii) the savings institution charges the officer, director, or employee the same fee charged any other customer of the institution in similar circumstances.

1982, c. 103, § 6.1-195.40:2; 1985, c. 425, § 6.1-194.22; 2010, c. 794.

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