My state's Public Funds law requires government depositors to obtain collateral security agreements from their banks to ensure amounts over $100,000 are protected. An agency has a valid collateral security agreement in place and also has a sweep account with the bank to maximize the amount of interest that they earn. Does the agency have a perfected security interest in the money in the sweep account, or would they need to affirmatively file to perfect?
The lien perfection rules vary somewhat from state to state. Within a state, the steps required for perfection of an interest in collateral depend upon the nature of the collateral.
It would be presumptuous to offer an opinion on the status of the agency's security interest. It would also likely be offering a legal opinion, which we cannot do. The agency should determine the exact nature of the collateral. It should be described in detail in the collateral security agreements, and consult with an attorney who is familiar with the working of Article 9 of the version of the Uniform Commercial Code that has been adopted in your state.
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The lien perfection rules vary somewhat from state to state. Within a state, the steps required for perfection of an interest in collateral depend upon the nature of the collateral. 