Skip to content
BOL Conferences
Page 1 of 2 1 2
Thread Options
#2191415 - 08/31/18 04:05 PM UTMA Acct Minor of Age
terpsfan Offline
Diamond Poster
Joined: Feb 2007
Posts: 2,058
If the custodian has not closed a UTMA account how should this be handled should we close the account or prohibit future deposits?

Return to Top
Deposits and Payments
#2191417 - 08/31/18 04:13 PM Re: UTMA Acct Minor of Age terpsfan
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
You don't do anything. If it goes dormant, you escheat it.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2191442 - 08/31/18 05:41 PM Re: UTMA Acct Minor of Age terpsfan
terpsfan Offline
Diamond Poster
Joined: Feb 2007
Posts: 2,058
Should we stop them from making deposits?

Return to Top
#2191452 - 08/31/18 07:08 PM Re: UTMA Acct Minor of Age terpsfan
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
Not sure why you care - the custodian is the only dog in this hunt, unless you think there is some suspicious behavior being conducted thru the account.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2191493 - 09/02/18 03:11 AM Re: UTMA Acct Minor of Age terpsfan
terpsfan Offline
Diamond Poster
Joined: Feb 2007
Posts: 2,058
So even if the minor is now 28 we should not be concerned?

Return to Top
#2191496 - 09/02/18 04:10 PM Re: UTMA Acct Minor of Age terpsfan
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
Well, you always have the ability to just close the account for no reason. If it is bothering you, cut a check payable just like the account is titled and send it to the custodian with a closure letter.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2191497 - 09/03/18 10:20 AM Re: UTMA Acct Minor of Age terpsfan
terpsfan Offline
Diamond Poster
Joined: Feb 2007
Posts: 2,058
Should we consider a sar since the minor is of age an they continue to make deposits and the deposits at time are more than $5000?

Return to Top
#2191498 - 09/03/18 10:53 AM Re: UTMA Acct Minor of Age terpsfan
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
What law has been broken other than the custodian breaching their fiduciary duty? But if you deem it suspicious based on the known facts, then by all means, help yourself. The question then becomes why did it take you 7-10 years to recognize it?
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2191499 - 09/03/18 02:09 PM Re: UTMA Acct Minor of Age terpsfan
terpsfan Offline
Diamond Poster
Joined: Feb 2007
Posts: 2,058
Since it is the custodians responsibility to ensure it follows the UTMA we do not closely monitor these accounts but we came across this one randomly and I was surprised transactions were still going in and out even thought the minor is now 28. It just felt like we should have to step in at some point given this is not what these accounts are for.
Last edited by terpsfan; 09/03/18 03:48 PM.
Return to Top
#2191518 - 09/04/18 12:17 PM Re: UTMA Acct Minor of Age terpsfan
terpsfan Offline
Diamond Poster
Joined: Feb 2007
Posts: 2,058
Is there any responsibility on our part to make sure the custodian follows through on their responsibility?

Return to Top
#2191519 - 09/04/18 12:19 PM Re: UTMA Acct Minor of Age terpsfan
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
Absolutely not. Like I said before, you have no dog in that hunt. You make the check payable in the form of the UTMA account - what they do with it or how they dispose of the money is not your problem.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2191521 - 09/04/18 12:39 PM Re: UTMA Acct Minor of Age terpsfan
terpsfan Offline
Diamond Poster
Joined: Feb 2007
Posts: 2,058
So we have any liability if the we allow the account to continued to be used? So to keep asking questions

Return to Top
#2191525 - 09/04/18 01:15 PM Re: UTMA Acct Minor of Age terpsfan
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
That is a question for your legal counsel.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2191611 - 09/05/18 03:29 AM Re: UTMA Acct Minor of Age terpsfan
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
Has anyone reached out to the custodian, from a customer service perspective, to point out that it might be time to consider disbursing the account? His/her answer will give you a clue about their intentions and purposes for keeping this account so long. This will also provide useful context for your conversations with legal counsel (and possibly your SAR committee).

I'm just going to hang this question out there to provide a little extra context (no need to answer):
If someone came into a branch and requested to open a UTMA account for their 28 year old child, would you allow it?

Return to Top
#2191709 - 09/05/18 07:58 PM Re: UTMA Acct Minor of Age terpsfan
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
In that case, the bank should NOT allow it because it's illegal to open such an account for the benefit of an adult and the bank is in a position to prevent it.

Has the "minor" in this sad tale made any claim on the account to the bank? Does the "minor" even know the account exists? If s/he does and the custodian won't hand the funds over, it's up to the "minor" to go to court to get an order for the funds. Other than that, check to see if the account qualifies for surrender as abandoned property. If it does, get rid of it that way.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#2191727 - 09/06/18 03:00 AM Re: UTMA Acct Minor of Age terpsfan
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
Quote:
In that case, the bank should NOT allow it because it's illegal to open such an account for the benefit of an adult and the bank is in a position to prevent it.
I agree, John. I would also apply this logic to future deposits in the original scenario, since the bank has knowledge of the beneficiary's non-minor status.

Return to Top
#2191730 - 09/06/18 10:59 AM Re: UTMA Acct Minor of Age terpsfan
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
since the bank has knowledge of the beneficiary's non-minor status.

And why is that really? How does the bank really know how old the beneficiary might be? Some States also provide for several dates, like 25 years old in CA under certain circumstances. The Bank is dabbling in something that does not concern them. If you want to close the account, close the account. But starting to act as the UTMA police - it is not worth the trouble. You do something on one UTMA account and not the next one and you might find some no-longer-minor suing the bank for not doing it for them.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2191837 - 09/06/18 05:44 PM Re: UTMA Acct Minor of Age terpsfan
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
Of course, closing the account is indeed to best way to ensure that the bank no longer accepts deposits.

And while I'm not suggesting that any bank start policing their UTMAs, I am underscoring that once the bank gains knowledge of a circumstance requiring a specific response, the bank mustn't go on pretending that is doesn't have such knowledge.

Return to Top
#2192012 - 09/08/18 03:56 PM Re: UTMA Acct Minor of Age terpsfan
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
It's interesting how this thread has developed from a simple question into a series of hypothetical what-ifs.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#2227611 - 12/17/19 09:55 PM Re: UTMA Acct Minor of Age terpsfan
M Cockrell Offline
Diamond Poster
M Cockrell
Joined: Jan 2003
Posts: 1,046
Dallas, TX
Is there any prohibition against the bank providing information to beneficiary...IF the bene is already aware of the account?
_________________________
"Remember no man is a failure who has friends." - Clarence (the Angel) Oddbody - It's a Wonderful Life

Return to Top
#2227616 - 12/17/19 10:53 PM Re: UTMA Acct Minor of Age terpsfan
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
It is not their account - it belongs and is managed by the custodian, unless you have a legal order to disclose information to the minor.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2227737 - 12/18/19 10:19 PM Re: UTMA Acct Minor of Age rlcarey
M Cockrell Offline
Diamond Poster
M Cockrell
Joined: Jan 2003
Posts: 1,046
Dallas, TX
Randy, not trying to be contradictory, BUT you know me, I'm apparently always looking to stir the pot (actually, I'm just trying to garner a proper understanding). So that having been acknowledged, while the account is managed by the custodian, ownership of the funds was transferred to the minor/beneficiary and it is held under their social security number. The Texas Uniform Transfers to Minors Act; specifically, under the Texas Property Code, Title 10, Subtitle A, Chapter 141, Sec. 141.012, Paragraph (b) states: "A transfer made under Section 141.010 is irrevocable, and the custodial property is indefeasibly vested in the minor."

As such, I would contend it IS their account and they should have a right to information.

Please advise.
_________________________
"Remember no man is a failure who has friends." - Clarence (the Angel) Oddbody - It's a Wonderful Life

Return to Top
#2227740 - 12/18/19 10:37 PM Re: UTMA Acct Minor of Age terpsfan
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
It may be their funds, but until the custodian transfers the funds to the minor when they reach legal age, it is not their account. It would be no different with a trust account and they were named as a beneficiary. If the beneficiary wants information on the account - their avenue for that is either the trustee and in this case the custodian. I would not be interjecting the bank into the middle of this.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2227742 - 12/18/19 10:50 PM Re: UTMA Acct Minor of Age terpsfan
BrianC Offline
Power Poster
BrianC
Joined: Nov 2004
Posts: 6,685
Illinois
Similarly a disabled adult may own the funds in their estate account, but the court appointed guardian is the only person who has legal capacity to inquire about the account.
_________________________
Sola Gratia, Sola Fides, Sola Scriptura, Solus Christus, Soli Deo Gloria!
www.tcaregs.com

Return to Top
#2227790 - 12/19/19 05:14 PM Re: UTMA Acct Minor of Age rlcarey
M Cockrell Offline
Diamond Poster
M Cockrell
Joined: Jan 2003
Posts: 1,046
Dallas, TX
Originally Posted by rlcarey
I would not be interjecting the bank into the middle of this

Prudent advice.
_________________________
"Remember no man is a failure who has friends." - Clarence (the Angel) Oddbody - It's a Wonderful Life

Return to Top
Page 1 of 2 1 2

Moderator:  John Burnett