|
July 19, 2003
Robert E. Feldman
Executive Secretary
Attention: Comments/Legal ESS
Federal Deposit Insurance Corporation
550 17th Street, NW
Washington, DC 20429
Dear Mr. Feldman:
Thank you for this opportunity to comment on the proposed rules for
insurance of living trust accounts. I would like to speak in favor of
Alternative Two.
It is my opinion that Alternative Two would be the easier of the two
alternatives to understand. By making a separate category of account
coverage for living trusts, it would keep those accounts from getting
confused with single, joint, or P.O.D. accounts and make in easier for
financial institutions to show the amounts of insurance coverage to
depositors. I agree that, when there are two grantors, the account
should be insured to $200,000.00.
I understand that
Alternative Two will not change the insurance of any other category of
accounts, meaning that P.O.D. accounts will continue to be insured as to
qualifying beneficiaries as they have been for many years. I further
understand that the living trust category would be a totally separate
category and would not affect the single ownership or joint ownership
eligibilities. If I am correct in my understanding of the Proposed
Rules, I believe that Alternative Two would be the best solution.
While Alternative One
may offer advantages for customers, it places an added burden on
financial institutions by requiring that the institutions determine the
kinship of the beneficiaries to the grantor on all trust accounts.
Living trust accounts already cause banks added administrative burdens
because they are not uniform and each one must by scrutinized to
determine beneficiaries and successor trustees. Besides, many grantors
do not want to share any more than the bare minimums when it comes to
the information contained in the trust.
You have asked for
comments on the requirement that the financial institution certify the
existence of a living trust when a depositor opens the account. We think
that such a requirement would not cause any material change in the way
Fairfield Federal currently handles the opening of a trust account. We
currently require that the customer give us a copy of three essential
pages of the trust showing the title and grantors of the trust, the
successor trustee, and the page showing the signatures of the grantors
of the trust.
Thank you for your
consideration of my comments.
Sincerely
Judith M. Root
Vice President
Fairfield Federal
Lancaster, OH
| 
