We all know that it is a digital world. Most people routinely receive bills, correspondence, and other important information by email. We post and share photos on Facebook, Instagram, and other social media sites. In keeping with our modern age, the Michigan Legislature has recently passed the “Fiduciary Access to Digital Assets Act,” P.A. 59 (2016), which becomes effective June 27, 2016.
It used to be that if a parent or family member passed away, or needed assistance with financial matters, a child could simply sort through the papers in the desk or safe deposit box, or monitor the mail, to track down assets and identify outstanding bills. But as our personal and financial accounts have increasingly moved online, gaining access has become more and more difficult. Many companies refused to provide family members and legal fiduciaries with access to those online accounts. The Fiduciary Access to Digital Assets Act helps to remedy this situation.
Under the Act, entities who hold and store your electronic data, such as Facebook, Microsoft, etc., are called “digital custodians.” Under the new law, a fiduciary acting under a power of attorney, a personal representative of an estate, a trustee of a trust, or a court-appointed conservator may receive digital information or be granted access to online accounts. In order for such access to be granted, the “digital custodian” must receive a written request for disclosure, a copy of the death certificate (if applicable), and a copy of the letters of authority for a personal representative or the power of attorney which grants you authority. Once a request for access is made, the digital custodian has 56 days in which to respond.
The requested information can be disclosed in any one of three ways:
- Grant the fiduciary full access to the account
- Grant the fiduciary partial access to the account to perform the required duties (for example, view brokerage account statements, but not place trades)
- Provide a copy of digital assets that the user could have accessed (for example, forwarding copies of photos stored in a cloud account)
The new laws specifically states that the powers granted to the fiduciary under the Act cannot be used to impersonate you, so the fiduciary cannot post things to social media accounts pretending to be you. Further, as with all fiduciaries, the fiduciary must always act in your best interests in access or using the information received, or in the best interest of your estate.
As we increasingly move to a more and more digital society, the Fiduciary Access to Digital Assets Act will become a useful tool when planning for incapacity or for administering estates after death.