Section 16-75-44 - Prohibited investments(a) Trust funds shall not be used in any way, directly or indirectly, as prohibited in this section.(b) In the case of trust funds where a board is appointed as trustee, the trustee shall not make any loan or loans to any officer or director of the cemetery and pre-need funeral authority, or to any of its officers, directors, agents, or employees, or to any trustee of the trust, or to any company, firm, copartnership, association, or individual, either directly or indirectly.(c) In the case of trust funds where a bank or trust company is appointed as trustee, the trustee may be permitted to make a loan or loans to an officer, director, agent, or employee of the cemetery and pre-need funeral authority, or to a company, firm, copartnership, association, or individual upon the written application of the person, company, firm, copartnership, association, or individual, stating the line of credit applied for, terms and security offered therefor to the trust fund, and then only with the written approval of the trustee of the trust fund before the loan is made, and the approval of the loan as allowed by the trustee of the trust fund shall be made a part of the financial records of the cemetery and pre-need funeral authority to be disclosed in the annual audit. Loans may be made to any officer, director, agent, or employee of the cemetery or pre-need funeral authority without application and approval: (1) In any amounts where the loans are secured by bonds of the State, or bonds or notes of the United States, or certificated of indebtedness of the United States, where the amount of the collateral is equal to at least one hundred five per cent of the amount of such loan; and(2) In amounts, excluding loans secured, as provided in paragraph (1), not in excess of $5,000 in aggregate principal owing by any individual at any one time. Any cemetery or pre-need funeral authority, or trustee who knowingly permits the funds of the trust fund to be loaned in a dishonest manner or contrary to this section shall be in violation of chapter 441, HRS, and this chapter.
(d) No trust funds shall be used in any way by the cemetery or pre-need funeral authority, or any director, officer, agent, or employee of any cemetery or pre-need funeral authority, or trustee as collateral for other security.(e) No trust funds or monies intended for the trust fund shall be commingled with the funds of any person, firm, company, copartnership, association, or corporation.[Eff 11/19/87; comp 1/21/92] (Auth: HRS § 441-19) (Imp: HRS § 441-19)