There was a time, not too long ago, that you could walk into a bank with a conventional legal document, like a power of attorney, certification of trust, or court order, and get your business done. The bank could be reasonably certain of the authenticity of the document because it was on 8.5×11 bond paper, typed or computer printed out, signed in blue, and bearing the official stamp of a notary or other government official. 

Someone at the bank likely knew you or the other party, the drafting attorney or a court clerk. And, things just generally moved more slowly, so there was a lag during which errors or omissions could be fixed.

But now, with just a laptop computer, wifi, and a basic printer (to say nothing of 3-D printing and artificial intelligence), each and every one of us has access to all the knowledge and equipment needed to make a forgery that would have blown minds just 20 years ago. None of us know the teller at the bank anymore because we never go into the bank. 

Everyone wants everything done immediately.
Society has moved on from conventional legal documents and gone digital with e-tickets, email, digital permissions, and two-factor authentication. And banks have moved on to credit cards, mobile banking with remote deposits, and instant transfers. 

But conventional legal documents have not.

So, over the last decade, my trust and estate law colleagues and I have noticed a marked decline in banks’ cooperation with these documents. We have become used to handling push back on documents like powers of attorney. And most of us provide advance warning and instruction on the topic. However, as demonstrated by the following interaction, banks have reached a new, somewhat illegal, but entirely unsurprising level of skepticism for conventional legal documents.

___________

The following is a true story
(and of course we changed the names to protect all parties and avoid being sued) 

I am a trust and estate attorney, and my trustee client and I are in the middle of a standard trust administration. The trust had an a/b split upon the death of the first grantor, and now, following the death of the second grantor, we are in the process of administering and winding up both the a and b trusts.

[Trust Attorney &Client]

Successor Trustee/Client: “Hi, Trust Attorney, I provided the updated Certification of Trust you created to Global Bank, but they are not updating title to the trust account. I don’t know what to do? I can’t access that account.”

Trust Attorney: “No problem; I’ll take care of it. The Disclaimer Trust is irrevocable and already has a taxpayer ID. We just need to update trustees. Who’s your contact? I’ll explain it to them.”

[Trust Attorney & Global Bank]

Trust Attorney: “Hello, my name is Trust Attorney and I represent the successor trustee of the Disclaimer Trust; we need to update title to the account now that the original trustee has died. I have the updated Certification of Trust; that is all you need.” 

Global Banker: “Ok, well, I’ll take the Certification of Trust, but I also need the cover and title pages, and the signature page with notarial acknowledgement, and the death certificate.“

Trust Attorney: (No, you don’t. It’s already in trust; it’s simply a change of trustee) “Sure, you got it. It’ll be in your inbox within minutes.” 

**Three Weeks Later after Documents Sent – Still No Response**

Trust Attorney: “Hi again, what’s the status of title to the Disclaimer Trust account? We just closed escrow and need to wire sale proceeds from a real property sale.”

Global Banker: “No update yet. Legal says we need an entire copy of the trust, plus any and all amendments, the federal taxpayer ID, and the Certification of Trust. 

Trust Attorney: (No, you don’t. The Trust was irrevocable upon creation; it’s the same taxpayer ID it’s had for the past ten years. Oh, and it’s a violation of California Probate Code  § 18100.5 law to not accept the Certification of Trust. You can be sued for damages and attorneys fees…..) “Literally, the only change is trusteeship. This is straightforward. But sure, I’ll give you whatever you (think you) need.” 

Global Banker: “Yeah, the account is frozen. I need all the requested info.”

Trust Attorney: “What!? Why is the trust account frozen? It’s not an individual account.. Ok, fine, how would you like those documents? Email, upload, fax, snail mail, carrier pigeon, or hand delivery?” We need that account open as soon as possible.”

To be clear, we want banks to be diligent. But the above-exchange is the tip of the iceberg. Banks will do anything to shield themselves from liability. 

Fair enough; what’s a consumer to do? 
Well, you’ve gone through the trouble of implementing an estate plan so your beneficiaries do not have to suffer when you are gone. Take that final step and register your trust, bring it into the digital age, and bypass the chaos that is likely to ensue.

The article was written by the illuminote Legal Team –  illuminote