My son, who is a minor, was listed on a CD of mine (using "OR" to separate the owners). My CD says I must produce the certificate when cashing it. My son went into my bank, asked to have all accounts with his social security number shown to him. They then allowed him to cash in a $5,400 CD, and gave him the money in cash and let him walk out the door with it. Is this within banking regulations? I'm astounded that I was not contacted questioning this transaction especially because of his age, and that he had no certificate or CD number.
In some states a minor can own a bank account in their name alone. In others, having a parent or guardian on the account is all that is needed. Because you gave your son equal ownership by using "OR" in the account styling, he had full rights to the funds, and even though a bank may request that an actual certificate be given to cash in a CD, it is very common that they're cashed without them. They get lost or misplaced so often that many if not most banks don't issue the actual certificate any longer. They provide a receipt and the rest is electronic.
An UTMA account would have put the funds in your son's name, but allowed only you (assuming you're listed as the custodian) to control the funds. Using an account styling of "AND" could have provided equal rights so that both of you would have to approve this withdrawal, but many institutions don't want the burden of verifying that both of you consented to the withdrawal. They may not allow such an ownership designation and you wouldn't always want to get your son's permission to withdraw the money.
There isn't much that can be done at this point with the bank. To recover this money you'll need to go to your son.
BankingQuestions.com is a free service made possible by the generous support of our advertisers. Advertisers are not responsible for site content. Please help us keep BankingQuestions.com FREE by supporting our advertisers. When you see an ad for a product or service you may have an interest in, click through to learn more.
Accounts
Article
Q&A
Podcast
Video
Blog
Discussions
PDF
Powerpoint
In some states a minor can own a bank 