Judgement and Irrevocable Trust

[hamburgler]

Chase has sued me over past due credit card debt and I will be filing an answer this week. In the event a judgement is made against me and a payment plan is not resolved, will Chase be able to freeze a bank account that I am a trustee over but where I have no entitlement to the money in the account.

The account is an irrevocable trust that is for the benefit of my mother. My brother and I preside over it as trustees and our social secuirty numbers are on the account. We dispense money to our mother out of it monthy and for one time expenses. The genesis of the funds came from my father's will. In a sober moment, our mother gave us control of dispensing of the money to her to prevent her from spending it too fast. She is a non recovered substance abuser with budgeting issues.

I am concerned that if a judgement were to be made against me that this account would show up as an asset of mine. Again, my only right to the money is to access it for my mother, not any of my own needs.

[WhatMoney]

A trust account should not be attachable under you as the trustee, since you do not own the funds in the account. Chase should clearly indicate that you are the trustee and not the owner of the funds.

I would talk to your local branch manager about this and try to get a written agreement from them that verifies this. While this is not necessary since it's obvious a creditor cannot steal funds from your mother, it is always a good idea to make the branch manager aware of this possibility.

Of course it will be easy to correct any levy on your mother's funds. In fact, if you have a written agreement from Chase concerning this account and they still freeze it, there are many attorneys that would love to take your case and ask for sanctions against Chase for violating the law.

Most banks where I have brought up this question clearly will not honor a bank levy for a trust account or a representative payee account. It is essentially theft for them to do so. But discuss it, since branch managers are often clueless until you force them to consult legal and actually think.