Kellogg’s CFO forgot to put an account with $56K in a trust before passing — bank wouldn’t release funds. Legal?

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Kellogg’s CFO forgot to put an account with $56K in a trust before passing — bank wouldn’t release funds. Legal?

Kellogg’s CFO forgot to put an account with $56K in a trust before passing — bank wouldn’t release funds. Legal?

When former Kellogg’s CFO Charles Elliott passed away in 2022, he left behind a carefully planned estate – with one flaw.

Everything had been placed in a trust for his two children, ensuring a smooth transition of assets. But one small oversight — a $56,000 checking account with no designation — turned into a major legal headache.

His daughter, Christine Elliott, expected Chase Bank to release the funds to the trust, so it could then be sent to her and her brother. Instead, she was met with silence.

“So I provided what they said I needed, and then he called back and said, ‘It’s not enough,’” Elliott told 7News Miami. “I said, ‘Well, what do I need?’ And he said, ‘I can’t tell you.’”

In estate law, financial institutions are required to follow strict protocols when handling accounts of the deceased. If an account is not specifically designated to a beneficiary or placed in a trust, it typically falls under probate, according to Keystone Law Group.

In this case, Elliott provided all necessary documents, yet the bank still refused – for about a year – to release the funds or explain why.

Are the bank’s actions legal? Unfortunately for the Elliotts, yes. But here’s how they were still able to get the money, plus interest.

The good news is that Elliott finally received her check – including more than $2,000 in accrued interest – after 7News legal expert Howard Finkelstein hopped on the case. But what took the bank so long?

Banks have the right to withhold information about an account’s status, which is typically treated as private information and not privy to anyone but the account holder.

Finkelstein explained the situation bluntly.

“No, they don’t have to tell you, but they do have to tell a judge,” he told 7News. “In this case, a judge signed an order to transfer the funds to the trust. Now the bank has to explain why they won’t do it. If the judge doesn’t like that explanation, they can fine the bank and force them to release that cash.”

The bank could have been withholding the money for several reasons.

Regardless, without an explanation, the family was left in the dark. And frustration and legal expenses can mount for anyone in the same scenario.

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If you or a loved one face a similar roadblock with a deceased relative’s bank account, there are steps you can take to break the deadlock.

The first step is to escalate the issue with the bank. While Elliott contacted multiple departments before giving up and calling the television station, persistence is key.

Requesting a meeting with a higher-level executive in the estate resolution department or filing a formal complaint can sometimes resolve bureaucratic issues.

Requesting legal justification from the bank is another option. While banks aren’t required to disclose specifics, they must follow the law. A probate attorney can send a formal demand letter requesting clarification on the legal grounds for withholding the funds.

If the bank remains uncooperative, filing a complaint with regulators can add pressure. The Consumer Financial Protection Bureau (CFPB) or a state banking regulator may be able to intervene and push for a resolution.

As a last resort, taking the matter to court may be necessary. A court order can compel a bank to release funds, though this option may be costly and time-consuming.

To avoid a similar nightmare, estate planning should cover every account. Even a minor oversight – like a checking account – can create major legal trouble.

Naming beneficiaries on all accounts is a crucial step. Experian says many banks allow accounts to be designated as “payable on death” (POD), which avoids probate entirely.

Regularly reviewing estate plans can prevent these issues. Even financial experts like the late Charles Elliott – a key leader for the cereal giant Kellogg’s – can overlook small details that may not be a top priority, which is why periodic checkups are crucial.

Creating an airtight estate plan can help heirs be sure of where assets are held and what steps they need to take when the time comes.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

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