I’ve written before about estate planning for your digital assets and online accounts. Well this article isn’t necessarily about planning, but what happens after you die – especially if you don’t plan (or even if you do). I do both estate planning and probate and trust administration. That means not only do we help people plan while they are alive, we help their relatives after their loved one dies.
The problem with “digital” probate
- Identifying and gathering their assets
- Paying off their creditors, and
- Distributing the assets to the beneficiaries.
However, as we live more and more of our lives online, there is a problem – when someone dies, how do you identify and gather assets?
Let me tell you how it used to work. Back in the old days – up until about 5 to 10 years ago – when a person died, their relatives, personal representatives, or attorney, would go to their house and go through their papers. They were usually organized in a file cabinet, or unorganized in a drawer or envelope somewhere. But the stack of papers generally had account statements from their banks, brokerage houses, and the like. Then, when looking at the statements, their relatives could see all the various bills that they were paying, and find out about other accounts – such as hotel or airplane reward accounts.
After going through their papers, their personal representative (what an executor is called in Florida) would then intercept their mail. Not e-mail, but snail mail. Again, after a few months, more statements would come. This would allow the personal representative to gather a complete picture of the decedent’s life. The P.R. could then obtain the assets, cancel the necessary accounts, etc.
Of course, That’s when people still had papers. Today, if you’re under the age of fifty, it’s likely that there are no papers, and you don’t get anything in the mail either.
- Bank account statements? Online.
- Stock statements? Online.
- Hotel affinity points? Online.
Instead of paper statements coming to their mailbox, “digital” statements go to their email address.
So how about having the Personal Representative go through the decedent’s email then?
Well for starters, the executor might not have access to the email accounts, the account providers might not give you the password, oh, and by the way, accessing the decedent’s email may be a federal felony under the Electronic Communications Privacy Act. The Uniform Law Commission’s Fiduciary Access to Digital Assets Committee, of which I am an American Bar Association Section Advisor to, is drafting a uniform law to help fiduciaries gain access to these accounts.
Finding the Accounts
But until they do, and even after they do, it is still a chore to find what a person owned – and where they may have had accounts. It’s not just bank accounts anymore either. It’s social media accounts such as Facebook and LinkedIn; Photo sharing accounts like Flicker and Instagram, hotel and airline “points” accounts (many of which are transferable upon death); dating accounts, etc.
Some of these may have actual monetary value – such as airline points. Some may have sentimental value – a picture sharing account. And some accounts you may just want to cancel so they stop charging the decedent, or to prevent online fraud and identity theft – think an Amazon account.
There is a company that I have been working with called Webcease, that will do just that.
First, full disclosure. I am a member of the Board of Advisors of Webcease and was granted a (very small) financial interest in the company in exchange for my advice.
However, I would not have chosen to do business with them if I did not approve of what they are doing. In fact, part of my role as an advisor was to help them comply with the applicable laws in this area. I’ve written before about my concerns about companies that claim to be able to transfer your “digital” assets upon death. The problem was that your assets pass via your will, your revocable trust, or other types of transfers, and these online companies may end up “transferring” the asset to the wrong heir, resulting in a lawsuit. I notice that since I wrote that post five years ago, Legacy Locker no longer exists as a separate company and has been purchased by “Password Box.” I have not reviewed how they are currently operating (maybe I will in the future), and express no opinion as to their current status. Anyway, it does seem that their software only works if the person used it and entered all of their information before death.
But that’s not going to happen for most people. Most people are going to die with a jumble of accounts, not listed, not stored anywhere, and with no way for the family to find them.
What Webcease Does
What Webcease does is search for accountsCan WebCease close any accounts or retrieve digital assets? WebCease will only identify the active accounts and instruct on the different options for retrieval, closure or memorialization in accordance with the policies of each site. We will not take any actions on behalf of the family, executor, representative or estate. – From the Webcease FAQ, finds them, tells you what they are, and tells you how to gain access or close them. That’s it. They provide a report with the information. They don’t claim to take ownership of the accounts, to manage the accounts, or to transfer the accounts. They don’t close the accounts for you. They tell you – the personal representative, heir, executor, attorney, etc. what’s there, and what you have to do about it. And they work with both heirs – and with probate attorneys directly.
I would not work with a company that claimed to obtain or transfer the digital assets upon death. To be honest, I’d still rather that people gathered all of their account information before death. But that does not always happen.
It’s not perfect. To use Webcease, you still need to have the Decedent’s email address – something that the searcher might not have at the start. Obviously the more information that you can give them, the better their searches are going to be. But sometimes you don’t even have the email address. Hopefully in the future they’ll be able to do searches without the decedent’s email address.
Also, as a probate attorney in South Florida, the vast majority of my probates are of estates where the decedent was very elderly – people who still kept paper and probably (although not necessarily) did not have Facebook accounts. I’m looking towards the future though.
I think it’s a great start, and I’m glad to be working with them.