Can A Beneficiary Ask to See Bank Statements in New York?

You can ask, and a sensible executor or administrator will show you. But a beneficiary has no right to walk into the bank and get the statements, and no right to have the fiduciary hand them over on demand in the middle of the administration. The enforceable right comes with the accounting: an accounting is delivered or filed with the records that support it, and in a judicial accounting the statements can be demanded and the fiduciary examined about them under oath. This page covers who can get bank statements and how, what the statements show, how to read them for missing assets, transfers before death and improper payments, and the limit the Dead Man’s Statute puts on what anyone can testify about afterward. It is part of our estate accounting section.

Who Can Get the Statements From the Bank

A bank releases a decedent’s records only to the person the court has appointed: the executor holding letters testamentary or the administrator holding letters of administration. A beneficiary, even the sole beneficiary, will be turned away until letters issue. If you are the nominated executor or the closest relative and no one has been appointed, the first step is the appointment, not the statements.

Two situations are different. If you are the named beneficiary of a payable-on-death or in-trust-for account, the account is yours on the owner’s death, outside the estate, and the bank will deal with you directly on presentation of the death certificate and its own affidavit. Before the owner’s death you have no rights in the account at all; the owner can change the beneficiary without telling you. And if you are a joint owner, the account was yours during the owner’s life and is yours now. Neither of those accounts passes through the estate, and neither appears in the executor’s accounting, though a transfer into a joint or in-trust-for account shortly before death is exactly the kind of transaction the estate’s statements reveal.

Asking the Fiduciary

A beneficiary of the estate asks the executor or administrator. The fiduciary is not obliged to send monthly statements or open the books on request, and the courts do not require it; the fiduciary is obliged to keep the records, keep estate money separate from their own under EPTL 11-1.6, and account when asked. That said, a fiduciary who is asked by a residuary beneficiary for the estate account statements and refuses has told the beneficiary something, and the beneficiary’s next letter is a demand for an accounting.

How much weight the request carries depends on your interest. A residuary beneficiary, who takes what is left after everything else is paid, is affected by every transaction in the estate account and is entitled to see all of them in the accounting. A specific legatee, left a sum or an item, is entitled to be paid and, if not paid within seven months of letters, to an explanation and interest; once paid, a specific legatee generally has no standing to demand the estate’s records at all. See what information a beneficiary is entitled to.

How the Statements Actually Arrive

• With an informal accounting. When a fiduciary accounts informally, the account goes to the beneficiaries with its backup: the estate bank and brokerage statements from the opening of the account, the closing statement on any real estate, the invoices behind the expenses, and the tax returns. A beneficiary asked to sign a receipt and release should have those records first, and is right to refuse to sign until they arrive. See informal accountings.
• In the accounting proceeding. In a judicial accounting, whether the fiduciary filed voluntarily under SCPA § 2206 or was compelled under SCPA § 2205, every interested party may examine the fiduciary under oath under SCPA § 2211 before objecting, and may demand the documents behind each schedule. Bank statements, cancelled checks, brokerage confirmations and closing statements are produced as a matter of course. This is the reliable route. See judicial accountings.
• By subpoena. Once a proceeding is pending, records can be subpoenaed from the bank directly. That matters when the question is what happened to the decedent’s accounts before the fiduciary was appointed, or before death, because those statements are not the estate’s records and the fiduciary may not have them. In a discovery proceeding under SCPA 2103 the fiduciary, or a beneficiary where the fiduciary will not act, subpoenas the records of the person who is thought to have taken the property.

If the fiduciary will not account when asked, the route to the statements runs through compelling the accounting.

What the Statements Show

An accounting is the fiduciary’s summary of the statements; the statements are the evidence. Read together, they answer four questions.

Missing assets

Schedule A of the account lists what the fiduciary received. The decedent’s final statements, tax returns and the inventory list what there was. Compare them. An account that shows $150,000 in bank deposits when the decedent’s last income tax return reported interest that only a larger balance would produce, or that omits a brokerage account the inventory listed, has a hole in it. Statements also show automatic transfers, dividend deposits and loan payments that point to accounts and property the fiduciary never listed.

Transfers before death

The decedent’s own statements for the last year or two of life, obtained by the fiduciary from the bank, show withdrawals, wire transfers, added joint owners and changes of beneficiary. A pattern of large cash withdrawals while the decedent was in a nursing home, or a transfer of the whole balance to a caregiver’s account three weeks before death, is the beginning of a discovery proceeding to bring the property back. The estate’s accounting cannot resolve it, because the money never reached the estate, but the accounting is usually where a beneficiary first sees that it is gone.

Improper payments

Schedule C lists the expenses the fiduciary paid. The estate statements show who was actually paid. Entries to look at: checks to the fiduciary personally beyond the commission computed under SCPA § 2307; payments to the fiduciary’s family; personal expenses such as the fiduciary’s own credit card, car or mortgage; cash withdrawals with no invoice; legal fees that are not supported by a bill and are subject to review under SCPA § 2110; and expenses of the house after it should have been sold. Each of these is an objection. See what can be paid from an estate account.

Delay and idle money

Statements show dates. An estate account that held $800,000 in a non-interest checking account for four years, or a brokerage account left untouched while the market moved, raises the questions the Prudent Investor Act asks and can support a charge of interest or a surcharge for the lost return. See the Prudent Investor Act.

The Dead Man’s Statute

Statements matter for a reason beyond arithmetic. CPLR 4519, the Dead Man’s Statute, bars a person interested in the outcome from testifying, over objection, about a personal transaction or communication with the decedent. A beneficiary generally cannot testify that “my mother told me the account was meant for me,” and an executor who took money before death generally cannot testify that “he said I could have it.” What each side is left with is the paper: the statements, the signature cards, the withdrawal slips, the checks, and the testimony of people who are not interested, such as the bank officer or the home health aide. A case about what happened to the decedent’s money is usually won or lost on records, which is why getting them, early and completely, is the first job.

For the Fiduciary

If you are the executor or administrator, keep every statement from the day the estate account is opened, and obtain the decedent’s statements for at least the year before death when you marshal the assets. Do not run estate money through your own account, even briefly; commingling is the single most common thing objectants find. When a beneficiary asks for statements, the cheapest answer is usually to provide them with a summary. A fiduciary with clean records loses nothing by showing them and avoids the petition that follows a refusal.

Pitfalls

• Going to the bank as a beneficiary. You will be refused, and you will have spent time that should have gone into a written request to the fiduciary.
• Signing the release first. A receipt and release given before you have seen the statements bars your objections unless the fiduciary concealed something material, which is hard to prove after the fact. See receipts and releases.
• Reading only the account. The schedules are the fiduciary’s version. The statements are the facts. Reconcile them.
• Waiting. Banks keep records for a limited number of years. Transfers before death are hardest to prove when the statements are no longer obtainable.
• Expecting the estate’s accounting to reach non-estate accounts. Joint, in-trust-for and payable-on-death accounts are outside it. They are reached, if at all, by a discovery proceeding.

Talk to Us

If you are a beneficiary who wants to see the records behind an estate, or a fiduciary who has been asked for them and wants to respond correctly, we can tell you what is available now, what comes with the accounting, and what has to be subpoenaed. We handle accountings, objections and discovery proceedings in the Surrogate’s Courts of New York City, Long Island and Westchester. Call 212-233-1233 or email [email protected].