One of our long time customer's would like to set up a savings account to accept donations from the public where the proceeds will be used to help pay for medical expenses of a recent burn victim. Are there any special regulatory issues/requirements on this? How should the account be titled? Any advice would be greatly appreciated...

You should check your state laws. I know in Florida we have rules laid out for soliciting contributions. It requires a trust agreement be drawn before an account can be opened. If you are in Florida let me know and I can forward you some information.

In a seminar in GA a couple of weeks ago a horror story was told about an account like this. A deposit account was set up for the parents of a child who needed a liver transplant. The community raised $300,000 for the transplant. When the call came that a liver was ready, there was only $10 in the account. The father had taken all of the money and squandered it away. The newspaper the next day told everyone that the 'Bank' let this happen. Not a good PR situation.

I don't have answers for you, but wanted you to be aware of some issues that could arise from this.

Article on tragedy accounts that addresses virtually every issue. The reputation risks in opening this type of account are real.

Thank you, Ken, for providing this. We just had this situation where an attorney (who is ALWAYS right) wanted to use HIS SSN as the TIN on a donation account for a person who was killed in that train crash in Europe. He couldn't understand why we wouldn't "just do it." Of course, he would never go bankrupt, have garnishments, or write bad checks on any other account that would cause us to look for any account with his SSN.... It's difficult when good-hearted people are just wanting to help a family in need, and the banker's heart-strings are tugged as well. Stand strong! Do the right thing!

Ken, Do you know if Tennessee has a support trust law like the one in Oklahoma? Your "Article" link above has a link in it (Oklahoma law) to a form used to establish a support trust. I haven't found anything specific yet but I'm still looking. If you know of anything, please let me know. Thanks,