§ 162a. — Deposit of tribal funds in banks; bond or collateral security; investments; collections from irrigation projects; affirmative action required.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 25USC162a]
TITLE 25--INDIANS
CHAPTER 4--PERFORMANCE BY UNITED STATES OF OBLIGATIONS TO INDIANS
SUBCHAPTER III--DEPOSIT, CARE, AND INVESTMENT OF INDIAN MONEYS
Sec. 162a. Deposit of tribal funds in banks; bond or collateral
security; investments; collections from irrigation projects;
affirmative action required
(a) Deposit of tribal trust funds in banks
The Secretary of the Interior is hereby authorized in his
discretion, and under such rules and regulations as he may prescribe, to
withdraw from the United States Treasury and to deposit in banks to be
selected by him the common or community funds of any Indian tribe which
are, or may hereafter be, held in trust by the United States and on
which the United States is not obligated by law to pay interest at
higher rates than can be procured from the banks. The said Secretary is
also authorized, under such rules and regulations as he may prescribe,
to withdraw from the United States Treasury and to deposit in banks to
be selected by him the funds held in trust by the United States for the
benefit of individual Indians: Provided, That no individual Indian money
shall be deposited in any bank until the bank shall have agreed to pay
interest thereon at a reasonable rate, subject, however, to the
regulations of the Board of Governors of the Federal Reserve System in
the case of member banks, and of the Board of Directors of the Federal
Deposit Insurance Corporation in the case of insured nonmember banks,
except that the payment of interest may be waived in the discretion of
the Secretary of the Interior on any deposit which is payable on demand:
Provided further, That no tribal or individual Indian money shall be
deposited in any bank until the bank shall have furnished an acceptable
bond or pledged collateral security therefor in the form of any public-
debt obligations of the United States and any bonds, notes, or other
obligations which are unconditionally guaranteed as to both interest and
principal by the United States, except that no such bond or collateral
shall be required to be furnished by any such bank which is entitled to
the benefits of section 12B of the Federal Reserve Act, with respect to
any deposits of such tribal or individual funds to the extent that such
deposits are insured under such section: Provided, however, That nothing
contained in this section, or in section 12B of the Federal Reserve Act,
shall operate to deprive any Indian having unrestricted funds on deposit
in any such bank of the full protection afforded by section 12B of the
Federal Reserve Act, irrespective of any interest such Indian may have
in any restricted Indian funds on deposit in the same bank to the credit
of a disbursing agent of the United States. For the purpose of this
section and said Act, said unrestricted funds shall constitute a
separate and distinct basis for an insurance claim: Provided further,
That the Secretary of the Interior, if he deems it advisable and for the
best interest of the Indians, may invest the trust funds of any tribe or
individual Indian in any public-debt obligations of the United States
and in any bonds, notes, or other obligations which are unconditionally
guaranteed as to both interest and principal by the United States: And
provided further, That the foregoing shall apply to the funds of the
Osage Tribe of Indians, and the individual members thereof, only with
respect to the deposit of such funds in banks.
(b) Investment of collections from irrigation projects and power
operations on irrigation projects
The Secretary of the Interior is authorized to invest any operation
and maintenance collections from Indian irrigation projects and revenue
collections from power operations on Indian irrigation projects in--
(1) any public-debt obligations of the United States;
(2) any bonds, notes, or other obligations which are
unconditionally guaranteed as to both principal and interest by the
United States; or
(3) any obligations which are lawful investments for trust funds
under the authority or control of the United States.
The Secretary of the Interior is authorized to use earning \1\ from
investments under this subsection to pay operation and maintenance
expenses of the project involved.
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\1\ So in original. Probably should be ``earnings''.
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(c) Investment of tribal trust funds in public debt obligations
(1) Notwithstanding subsection (a) of this section, the Secretary of
the Interior, at the request of any Indian tribe, in the case of trust
funds of such tribe, or any individual Indian, in the case of trust
funds of such individual, is authorized to invest such funds, or any
part thereof, in guaranteed or public debt obligations of the United
States or in a mutual fund, otherwise known as an open-ended diversified
investment management company if--
(A) the portfolio of such mutual fund consists entirely of
public-debt obligations of the United States, or bonds, notes, or
other obligations which are unconditionally guaranteed as to both
interest and principal by the United States, or a combination
thereof;
(B) the trust funds to be invested exceed $50,000;
(C) the mutual fund is registered by the Securities and Exchange
Commission; and
(D) the Secretary is satisfied with respect to the security and
protection provided by the mutual fund against loss of the principal
of such trust funds.
(2) The Secretary, as a condition to complying with a request
pursuant to paragraph (1) of this subsection, is authorized to require
such tribe or individual Indian, as the case may be, to enter into an
agreement with the Secretary for the purpose of relieving the United
States of any liability in connection with the interest, or amount
thereof, payable in connection with such trust funds so invested during
the period of that investment.
(3) Investments pursuant to paragraph (1) of this subsection shall
be deemed to be the same as cash or a bank deposit for purposes of
section 955 of this title.
(d) Trust responsibilities of Secretary of the Interior
The Secretary's proper discharge of the trust responsibilities of
the United States shall include (but are not limited to) the following:
(1) Providing adequate systems for accounting for and reporting
trust fund balances.
(2) Providing adequate controls over receipts and disbursements.
(3) Providing periodic, timely reconciliations to assure the
accuracy of accounts.
(4) Determining accurate cash balances.
(5) Preparing and supplying account holders with periodic
statements of their account performance and with balances of their
account which shall be available on a daily basis.
(6) Establishing consistent, written policies and procedures for
trust fund management and accounting.
(7) Providing adequate staffing, supervision, and training for
trust fund management and accounting.
(8) Appropriately managing the natural resources located within
the boundaries of Indian reservations and trust lands.
(June 24, 1938, ch. 648, Sec. 1, 52 Stat. 1037; Pub. L. 98-146, title I,
Nov. 4, 1983, 97 Stat. 929; Pub. L. 101-644, title III, Sec. 302, Nov.
29, 1990, 104 Stat. 4667; Pub. L. 103-412, title I, Secs. 101, 103(b),
(c), Oct. 25, 1994, 108 Stat. 4240, 4241.)
References in Text
Section 12B of the Federal Reserve Act, referred to in subsec. (a),
formerly classified to section 264 of Title 12, Banks and Banking, has
been withdrawn from the Federal Reserve Act and incorporated in the
Federal Deposit Insurance Act which is classified to chapter 16
(Sec. 1811 et seq.) of Title 12.
Amendments
1994--Subsec. (a). Pub. L. 103-412, Sec. 103(b), inserted ``to
withdraw from the United States Treasury and'' after ``prescribe,'' in
second sentence.
Subsecs. (b), (c). Pub. L. 103-412, Sec. 103(c), redesignated
subsec. (b), relating to investment of trust funds, as (c).
Subsec. (d). Pub. L. 103-412, Sec. 101, added subsec. (d).
1990--Subsec. (a). Pub. L. 101-644, which directed the designation
of existing provisions as subsec. (a) and the addition of subsec. (b),
was executed by adding subsec. (b) relating to investment of trust
funds. See 1983 Amendment note below.
1983--Pub. L. 98-146 designated existing provisions as subsec. (a)
and added subsec. (b).
Repeal of Inconsistent Provisions and Construction With Other Laws
Section 2 of act June 24, 1938, repealed act May 25, 1918, ch. 86,
Sec. 28, 40 Stat. 591, which was contained in former section 162 of this
title, and all other inconsistent acts.
Section 3 of act June 24, 1938, provided: ``Nothing contained in
this act shall be construed as affecting the provisions of the Federal
Reserve Act or regulations issued thereunder relating to the payment of
interest on deposits.''
Transfer of Functions
For transfer of functions of other officers, employees, and agencies
of Department of the Interior, with certain exceptions, to Secretary of
the Interior, with power to delegate, see Reorg. Plan No. 3 of 1950,
Secs. 1, 2, eff. May 24, 1950, 15 F.R. 3174, 64 Stat. 1262, set out in
the Appendix to Title 5, Government Organization and Employees.
Section Referred to in Other Sections
This section is referred to in sections 155b, 1300i-3, 1724, 1754,
1773d, 1776h, 1777c, 4011 of this title.
