I am very unhappy with my bank right now. My lawyer drafted a living trust for me and my wife and told us to go to the bank and transfer our accounts into our trust, but the bank won't do it unless we give them a copy of the trust or some other kind of documentation on it. As far as we're concerned, this is a private matter and the bank has absolutely no business knowing how we're going to distribute our assets. Is this just a bank policy?
Any financial institution would need to obtain a certain amount of documentation in a case like this. Basically, the trust is now going to become the owner of one or more deposit accounts. That means the trust itself will be the bank's customer. Federal law (courtesy of the USA PATRIOT Act) requires all financial institutions to have Customer Identification Programs to verify the identity of every customer. While the methods used by financial institutions can vary from one to another, the bottom line is that each financial institution must verify identity in a way that allows it to form a reasonable belief that it knows the true identity of the customer, so, for that reason, the bank will need to see some documentation on your trust.
In addition, the bank will need to know certain things about your trust to be able to set it up correctly, to know who is authorized to act on the trust's behalf, and to determine how the FDIC insurance will apply to your trust accounts. That will include the need to know:
Who the successor trustee is, and the conditions under which they take over from the original trustee;
Whether the trust is revocable or irrevocable;
If the trust is revocable, who holds the power to revoke, and is it the grantor or a nonadverse party?
What limitations or unusual conditions are there on the power of the trustee?
Who are the beneficiaries? Which beneficiaries are entitled to a share after the death of the grantor(s) and what will their share be? Do the beneficiaries fall within the categories of spouse, children, grandchildren, siblings, or parents?
The bank is not seeking information about your trust because it's snoopy, or because the trust makes interesting reading. It needs the information to be able to comply with the law and correctly set up and maintain the account. For that reason, you will need to provide documentation on the trust. Depending upon the particular financial institution, acceptable documentation may be the trust agreement itself, or a Memorandum of Trust or Certificate of Trust.
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Any financial institution would need to obtain a certain amount of documentation in a case like this. Basically, the trust is now going to become the owner of one or more deposit accounts. That means the trust itself will be the bank's customer. Federal law (courtesy of the 