Skip to content
BOL Conferences
Thread Options
#1992075 - 01/29/15 12:34 PM Minor accts linked for ODP
M&M Offline
Platinum Poster
Joined: Nov 2003
Posts: 530
Midwest
We have some custodial savings (minor) accounts that are linked to deposit accounts for ODP coverage. We are planning on delinking and sending notices (30 days in advance), but is this a violation of the Uniform Transfers to Minors Act? Where is this prohibited in the Act? Is this state specific based on residence?

Return to Top
Deposits and Payments
#1992081 - 01/29/15 01:09 PM Re: Minor accts linked for ODP M&M
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
You won't find a "thou shalt not..." addressing this specific practice in the Act, but you don't need to. It contradicts everything about why UTMA accounts exist and how they are supposed to work.

The funds in an UTMA account are an irrevocable gift to the beneficiary, and are only to be disbursed by the custodian for the minor's benefit. Allowing them to be transfered out to cover Mom & Dad's overdrafts is not consistent with these stipulations.

While it is not the bank's responsibility to police every withdrawal completed by the custodian, it would not be difficult to make the case that by allowing the custodian to link an UTMA account to their own account for ODP, that the bank was complicit in enabling the custodian to breach their fiduciary duty.

Return to Top
#1992276 - 01/29/15 07:24 PM Re: Minor accts linked for ODP M&M
M&M Offline
Platinum Poster
Joined: Nov 2003
Posts: 530
Midwest
Suggestions on the best source to find the letter of the law on UTMA?

Return to Top
#1992289 - 01/29/15 07:47 PM Re: Minor accts linked for ODP M&M
waldensouth Offline
Power Poster
waldensouth
Joined: Nov 2001
Posts: 7,985
FINALLY ABOVE the gnat line
Google or Bing
"Uniform Transfer to Minors Act" and you will find that there is one for each state. Choose your state's version for the definitive answer in your state.
_________________________
"Once you learn to read, you will be forever free."

- Frederick Douglass




My Opinion Only.

Return to Top

Moderator:  John Burnett