TN 5 (10-14)
PR 07230.008 Connecticut
A. PR 15-008 Access to a Beneficiary’s Conserved Funds held in a Connecticut Wells Fargo Account that is Properly Titled as a Representative Payee Account
DATE: October 7, 2014
Access to a beneficiary’s conserved funds held in a Connecticut Wells Fargo bank account by a new representative payee after the previous representative dies.
A properly titled bank account establishes that the funds belong to the beneficiary not the representative. In order to replace the former representative payee on the beneficiary’s account, the new representative payee must go to a Wells Fargo branch personally and present: (1) the death certificate of the former representative payee; and (2) a letter of appointment from the agency, SSA, identifying him/her as the new representative payee for the beneficiary.
I. Question Presented
How can the conserved funds belonging to a beneficiary be retrieved from a Connecticut bank account after the death of the representative payee who established the account on behalf of the beneficiary?
II. Short Answer
In order to access the funds, the new representative payee must go to a Wells Fargo branch personally and present: (1) the death certificate of the former representative payees; and (2) a letter of appointment from the agency identifying him as the new representative payee for the beneficiary.
Linda served as the representative payee for Christine until Linda’s death. In that capacity, Linda opened a conserved funds account at Wells Fargo (RTN ~; ACCT ~), which received (and continues to receive) direct deposits of Christine’s Social Security benefits. This bank account is titled “Christine, Linda Representative Payee.” Based on a recent bank statement, that account contained $20,088.98. After Linda’s death, the beneficiary’s brother, Richard, was appointed as her new representative payee.
When contacted by the agency, Wells Fargo refused to release any information concerning the account, citing privacy restrictions, and refused to return the funds to the agency. The beneficiary’s new representative payee has been maintaining the beneficiary without access to her benefits, but cannot continue do so for much longer.
IV. Applicable Law
20 C.F.R. § 404.2045 provides, in pertinent part, that
After the representative payee has used benefit payments consistent with the guidelines in this subpart (see § 404.2040 regarding use of benefits), any remaining amount shall be conserved or invested on behalf of the beneficiary. Conserved funds should be invested in accordance with the rules followed by trustees. Any investment must show clearly that the payee holds the property in trust for the beneficiary.
Agency guidance directs that those conserved funds “must be deposited in an account that is titled to show the payee has only a fiduciary interest in the funds” and that “[f]unds deposited by a fiduciary on behalf of a beneficiary are owned by the beneficiary.” POMS GN 00603.110A.
Under Connecticut law, share accounts held in trust for another must be established according to certain rules. See Conn. Gen. Stat. Ann. § 36a-296 (2014). For example, the despositor must provide the bank “with the name and a residential address for the beneficiary, upon establishing the deposit or share account or thereafter at the request of the bank.” Conn. Gen. Stat. Ann. § 36a-296(a)(1) (2014). The statute also provides that the despositor “may” provide a writing specifying the terms of the trust and that, unless such writing specifies to the contrary, “it shall be conclusively presumed” that the despositor intends to create a trust that follow certain specified terms. Id. As relevant here:
if the named beneficiary survives the despositor or share account holder, the despositor’s or share account holder’s death shall terminate the trust and title to the deposit account or share account, subject to any membership restrictions for Connecticut credit unions or federal credit unions, shall thereupon vest in the named beneficiary free and clear of the trust.
Conn. Gen. Stat. Ann. § 36a-296(a)(1)(C) (2014). Thus, unless the despositor provided a writing that specified to the contrary, Wells Fargo must conclusively presume that the balance of the account is owned by the named beneficiary on death of the despositor.
The account in question was established in accordance with POMS GN 00603 because it was titled in the beneficiary’s name and identified Linda as the “representative payee.” Under Connecticut law, when the despositor of an account held in trust for another individual, predeceases the beneficiary, the legal presumption is that the trust terminates and the account funds belong to the beneficiary, free and clear. Conn. Gen. Stat. Ann. § 36a-296(a)(1)(C) (2014).
Since the beneficiary now has a new representative payee, we contacted the branch manager of the Wells Fargo branch that the agency initially contacted, to determine how the funds could be accessed by the new representative. After consulting with Wells Fargo’s legal department, the branch manager informed us that the new representative payee may replace the deceased representative payee on the beneficiary’s account if he appears at any Wells Fargo branch and presents two pieces of evidence: (1) the death certificate of Linda, the former representative payee; and (2) an official letter or notice of appointment from the agency naming Richard as the successor representative payee. If Richard presents this evidence, Wells Fargo will replace Linda’s name with Richard’s on the account, permitting him access to the funds as the new representative payee.
In order to replace the former representative payee on the beneficiary’s account, the new representative payee must appear at a Wells Fargo branch and present the death certificate of the former representative payee and an official letter or notice from the agency demonstrating his appointment as the new representative payee.
Assistant Regional Counsel