Banking: Opening a Certificate of Deposit (CD)

[KimW]

Greetings,

Does Robert's Rules cover such specific topics like opening Certificate of Deposits (CDs)?  We would like to open a CD with organization funds but don't know if a board vote is needed.

 

Thank you,

Kim

P.S. Apologies if this is a duplicate - I opened topic as a guest before registration was complete and I don't see my topic in the list.

[Atul Kapur]

No, it does not. You may find guidance in your bylaws or other governing documents that, hopefully, specify the authority of the board and the officers. If they are lacking, your organization should consider developing and approving policies to clarify these and put them in writing for future reference.

[KimW]

Makes sense.  Thank you kindly.

[Gary Novosielski]

On 10/23/2023 at 1:08 PM, KimW said:

Greetings,

Does Robert's Rules cover such specific topics like opening Certificate of Deposits (CDs)?  We would like to open a CD with organization funds but don't know if a board vote is needed.

No, but for bank accounts owned by an organization rather than an individual, your bank will certainly require a copy of some resolution adopted by your group at a regular or properly called meeting at which a quorum is present.  Whether the board can authorize it depends on the powers of your board as defined in the bylaws.

Ask the bank and they will likely be able to supply you with a sample text of such a resolution, which may need to contain the names of those who are custodians of the account on behalf of the organization, perhaps the treasurer, for example.

[KimW]

Thank you - our bank has said anyone who is a signer on the account has authorization to open a CD.

We know we can do this with the bank.  We're just wondering if there's anything, besides our common sense, that states such a transaction should be approved by a Board quorum vote.   Sounds like there's not, so we shall rely on our common sense and take a vote!

Thank you both for taking the time to reply.  We have nothing in our bylaws currently about such things, so going forward we will be taking Mr. Kapur's advice and get policies created and approved that specify the authorization of directors, including what's needed for banking transactions and some other items like changes to rental agreements, that came to mind after reading Mr. Kapur's advice).

Cheers - Kim

[Joshua Katz]

On 10/23/2023 at 6:35 PM, KimW said:

We know we can do this with the bank.  We're just wondering if there's anything, besides our common sense, that states such a transaction should be approved by a Board quorum vote.   Sounds like there's not, so we shall rely on our common sense and take a vote!

Thank you both for taking the time to reply.  We have nothing in our bylaws currently about such things, so going forward we will be taking Mr. Kapur's advice and get policies created and approved that specify the authorization of directors, including what's needed for banking transactions and some other items like changes to rental agreements, that came to mind after reading Mr. Kapur's advice).

 

Well, I'm confused. When you ask if such a transaction should be approved by a board vote, what are you considering the alternative? Certainly some decision is necessary. But if there's nothing in the bylaws about such things, it isn't clear to me what authorizes the board to make the decision, rather than requiring a decision of the membership.