Some of the Many Reasons Estate Attorneys Should NOT Work with Citibank

While I have made sweeping generalizations that corporate trustees will take money from you faster than hitting after you draw 17 in Vegas, it’s pretty rare that I overtly criticize a particular financial institution in my blogs. But since I can’t hide my frustration anymore (and since proving libelous behavior requires a written statement to be untrue, which none of the following is) I feel it is time to send out a warning to my Estate Planning and Elder Law attorney colleagues: Do NOT work with Citibank, and tell your clients not to, for the following reasons:

The Inmates Get the Keys to the Asylum: Citibank allows their desk clerks to review your legal documents and make their own assessment on them. If you attempt to correct a recent college graduate as to his clearly wrong interpretation as to agency law you are likely to get an answer such as “This is what Citibank’s Legal Department requires.” I heard that exact answer the other day about needing an original Power of Attorney (see more below); if that’s true then their Legal Department employees needs a corporate bailout’s worth of CLE. True, this happens at all banks, but Citibank has been, in my experience, the worst bank when it comes to trusting Todd from Sigma Eta Tau with your financial rights. While banks harvest a boatload of fees and interest on their client’s assets, their front-line employees at a branch tend to be paid a little less than an indentured servant in colonial America, so they don’t attract the biggest or brightest stars in the collegiate stellar nursery…and these are the people they are trusting with your legal affairs.

Power of Attorneys: Citibank is the only bank I have had to work with that requires both Agents in a joint Power of Attorney to show up at the same time at the same branch. They are basically saying that if one of those Agents lives out of state you may as well have your finances languish in limbo until they can get the time and money to visit a branch with your other agent. I was also told at multiple Citibank branches that we needed an original Power of Attorney to open an account (no), that we needed a notarized doctor’s letter to show a Durable Power of Attorney was now effective (what what?), and that we needed a separate Power of Attorney for each client’s account that was owned with a different joint owner (nope). I was all of this in one conversation today.

Executors to Wills: Same issues here. Both Executors must show up at the same branch at the same time to establish an estate account. While this is not as bad as Citibank’s mirror policy with Powers of Attorney (since you need the POA for an existing account, while you can always choose to open an estate account with a more-competent bank instead of dealing with Citibank), it is still a huge inconvenience. I have had a Citibank employee require a copy of the decedent’s Will to open an estate account, even though we already had Letters Testamentary and an EIN for the estate (at which point we left and went to another bank).

Their Joint Accounts Sometimes Must Pass Through Probate Anyway: I had to still probate a Will on an account that was labeled “Husband and Wife, Joint Tenants”, but since the branch never entered the Wife’s Social Security Number on the original account paperwork, when the Husband died Citibank stated it was merely a “convenience account”, a determination that should be made by a court, not the bank, but anything goes at Citibank so why not just make your own laws regarding testamentary substitutes. This cost the client several months and lots of money, then when they finally had court authorization Citibank had sent the account to New York’s Unclaimed Funds website.

And before you say “Well, they are clearly being so cautious because they are protecting your clients”, you should remember that you are also a few cowbells short of Def Leppard’s Photograph, since only a crazy person thinks banks are watching out for clients over their own interests (granted, this is a general rule for many businesses, but banks have a Jumbo CD’s worth of greed and distrust saved in their own coffers).

I cannot speak as to Citibank’s competence as to attorney escrow accounts, bank wires or interest rates on their products, but in the Estate Planning world these are secondary issues that you expect all banks to have nearly the same level of competency. It is Citibank’s puzzling approach to legal documents that should cause Estate Attorneys alarm when they see a client whose funds are held at Citibank. And since no client wants to go through the cost of forcing them to comply with state law they stick to their guns. And yes, I also know that if you keep asking for the right person you will eventually find someone who knows what they are talking about, but by that standard everyone technically can avoid taking responsibility. Citibank’s problems of dealing with estate issues appears to be systematic.

My advice to Estate and Elder Law attorneys: Tell your elderly and sick clients to move their accounts out of Citibank before their incapacity or death. You will be doing them, their families and yourself a favor.



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