Keywords:Joint Account; Convenience Account, Banking Power of Attorney.

When is a bank account a joint account and when is it a so-called convenience account?

Under New York Law when two parties open a banking account it is presumed that a joint account with a right of survivorship. When Mom opens an account with your Sister and Mom dies, it is presumed that Sister inherits the account. And, the burden is upon you to prove otherwise.

There is a provision in New York's Banking law to create a convenience account. However, an informal survey of bank employees generally indicates that are not familiar with the regulations promulgated by the state banking department.

We suggest when you wish to establish a convenience account you speak to your account officer. If he/she is unfamiliar, we suggest you use a Power of Attorney

In one case this office handled, Aunt Henrietta was being looked after by her brother-in-law and her nephew. Periodically, she lost faith in one or the other and caused her bank account to be closed with the first relative and a new account opened with the other. The bank wanted to terminate the relationship. We succeeded in convincing Aunt Henrietta to keep the two accounts open but move half of the money into each account and execute a Power of Attorney to the relative rather than keeping a joint account. so that no one had too much power/control over her assets. She understood a Power of Attorney but not a convenience account.

New York has just revised its statutory Power of Attorney forms. And now, a Power of Attorney under New York's General Obligation Law is acceptable to banking organizations. Previously, each bank had its own Power of Attorney forms.