Imagine the following scenario: Your sister, your only sibling, is a single mother of two young children. She hasn't gotten around to making an estate plan because, well, she's the single mother of two young children. You know she does all her banking online, but you don't know the details. If she died suddenly, and you needed to administer her estate, would you know where to begin? Would you even be able to gain access to the information you needed? This is just one of many scenarios that makes fiduciary access to digital assets in Ohio an important issue.
A fiduciary is someone who manages assets for the benefit of someone else, and is required to do so in the beneficiaries' best interest. So "fiduciary" is an umbrella term that refers to, among other things, the executor of a will, the administrator of an estate where there is no will, a guardian, an agent under a power of attorney, or the trustee of a trust.
As a fiduciary, you have the responsibility to act in the best interest of the beneficiaries of an estate or trust, but until recently, it may have been difficult to gain access to the data or documents you needed to do so. Once upon a time, there were paper records of everything from bank statements to phone bills to baby pictures. If you were charged with managing a loved one's estate, you had to go through their files or desk drawers to get the records you needed. Now, many people live their lives and manage their finances online. If you don't have access to these digital assets, you may be powerless to act.
Ohio has adopted the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA). Among other things, the act defines the term "digital asset" as an electronic asset to which a person has a right or interest. The term "digital asset" does not include an underlying asset or liability unless the asset or liability is itself an electronic record. So, for purposes of RUFADAA, in the scenario above, your sister's electronic banking records are a digital asset, though the funds in the account would not be.
RUFADAA also allows individuals to grant to others the legal authority to access their digital assets and the content of their electronic communications. "Electronic communications" are defined as "any transfer of signs, signals, writing, images, sounds, data, or intelligence of any nature transmitted in whole or in part by a wire, radio, electromagnetic, photoelectronic or photooptical system that affects interstate or foreign commerce." This includes e-mails, text messages, and photographs.
The act also gives fiduciaries expanded authority to gain access to electronic communications or digital assets. Many online service providers, or custodians as they are called under RUFADAA, offer online tools through which users can instruct the custodian to disclose (or not) some part, or all of a user's digital assets to a fiduciary. Electronic communications may also be disclosed.
Absent direction given in an online tool, RUFADAA provides that owners of digital assets may authorize or prohibit access to digital assets and electronic communications by a fiduciary through provisions in a will, power of attorney, trust, or "other record."
What if, say, the authority granted by the owner and user of a digital asset in a will or trust conflicts with the terms of service agreement for the website on which the asset is stored? RUFADAA says that the user's direction prevails.
As technology advances, planning for digital assets is going to be increasingly essential. Just as individuals identify their assets in a will or trust, it may become commonplace to someday identify websites and apps to which a fiduciary may need to gain access. Until that happens, those serving as fiduciaries must anticipate what digital assets they may become responsible for.
If you are serving as a fiduciary, you may need access to the following types of sites and apps:
While, of course, it is easiest if the person whose assets you are responsible for provides you with a list of sites and passwords, that rarely happens. Consult with an experienced probate attorney to learn what you may need to do to gain access to and manage your loved one's digital assets and electronic communications.
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