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Opinion

Opinion Summary of Selected Opinion 98-180

Date: 10/01/1998
Organization: Division of Banks
Docket Number: 98-180

This opinion was issued in the fourth quarter of 1998.

Permissibility of foreign bank to advertise and solicit deposits in the Commonwealth

A foreign bank seeks to run advertisements and conduct seminars to inform prospective customers about a particular investment product. Mass. Gen. Laws chapter 167, section 37 prohibits a domestic or foreign corporation from transacting banking business in the Commonwealth, unless such entity is authorized to do so under the laws of the Commonwealth. Transacting banking business includes soliciting or accepting deposits in a manner which leads the public to believe that the entity is conducting the business of a bank. If the seminars and the advertisements are for informational purposes only, then the Division would not find that section 37 has been triggered. If, however, other activities were conducted at such a seminar, including but not limited to executing necessary paperwork to establish a contractual agreement; accepting funds in any form; or assigning account numbers, a violation of said section 37 would exist. If the activities of the Bank are deemed to be transacting a banking business, it would need to obtain prior approval to so act in the Commonwealth.

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