If you’ve been designated as a successor trustee of a Trust for a loved one, parent or friend, you probably know that one of your roles is (or will be) to gather all necessary documents and transactional information relating to bank accounts, funds, creditor information and the like.
The same is true if you will be the executor of a Will for an estate to be settled in the courts (Probate.)
As recent as the last generation, most such records were on paper: receipts, check books, savings statements, fund statements mailed to the account holder, etc.. That is changing fast.
Today many of these transactions are online, and it’s by no means just the younger generation that relies on e-based methods for financial transactions such as bank statements and fund transfers, purchases, insurance matters, credit card statements and the like.
So if you will be a successor trustee or an executor, a potential problem for you could be this:
PRIVACY vs. ACCESS
It’s a very good idea to get a handle on such transactional activities of those who you will represent while they are still alive. Note that your role in helping to settle an estate is a very important one; it will be necessary to carefully gather – preferably with some advance planning – all pertinent records of the deceased so that the Probate process or the Trust administration procedures do not get mis-managed or delayed.
To give you more insight, here is an excerpt from a note published by Molly Wilkens, a 2011 J.D. Candidate at the University of California, Hastings College of Law.
“Though online transactions are convenient for account holders during life, finding and understanding electronically-stored financial information after their deaths can quickly become a nightmare. There may be multiple computers or external hard drives that contain sensitive information. Online financial institutions keep transaction records and personal information as well: bank and investment websites, PayPal, subscription services, electronic medical records, shopping websites, and membership services all hold customers’ personal information. Customers often use one or more email accounts to receive updates from and communicate with these organizations. Each organization that collects a person’s private information, including email service providers, may have different passwords, security questions, and personal identification numbers required to access the account.
“Existing financial regulations delineate with whom and under what circumstances financial institutions may share customers’ private information. These laws also create criminal liability for stealing private financial information. Privacy laws, such as the Gramm-Leach-Bliley Act of 1999 (“GLBA”) and the Right to Financial Privacy Act of 1978 (“RFPA”), protect customers of financial institutions from misappropriation and misuse of their nonpublic financial information. Online financial transactions and communications are additionally subject to internet privacy laws.”
As you can see, the role of an executor, administrator or successor trustee may be getting more difficult, not easier.
It’s important to meet with your trustor or the person who has named you executor in a Will so that you can document all pertinent information and determine how to best access that information when needed later.
Remember too that an attorney trained in Estate Planning, Trust Administration and Probate can help you to understand and navigate the administrative role that you may have been assigned on behalf of a loved one.
Stephen A. Mendel, Estate Planning Attorney
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