Can I require all trust communication to be encrypted and secure?

In today’s digital age, safeguarding sensitive information within a trust is paramount, and yes, you absolutely can, and should, require all trust communication to be encrypted and secure. The increasing prevalence of cyber threats necessitates a proactive approach to protecting the privacy and financial well-being of beneficiaries and the integrity of the trust itself. Failing to do so can expose the trust to significant risks, including identity theft, fraud, and legal disputes. It’s estimated that data breaches cost businesses and individuals over $4.45 million on average in 2023, highlighting the real financial implications of inadequate security measures.

What Steps Can I Take to Protect My Trust’s Communications?

Protecting trust communications isn’t simply about adopting new technologies, though that’s a crucial part of it. It’s about establishing a comprehensive security protocol that covers all forms of communication, from email and phone calls to physical mail and in-person meetings. Consider the following steps:

• Email Encryption: Utilize end-to-end encryption for all email correspondence related to the trust. Services like ProtonMail or encrypted email plugins offer robust protection.
• Secure Messaging Apps: Encourage the use of secure messaging applications like Signal or WhatsApp, which offer end-to-end encryption and disappearing messages.
• Password Protection: Implement strong, unique passwords for all trust-related accounts and utilize a password manager to store them securely.
• Two-Factor Authentication: Enable two-factor authentication whenever possible to add an extra layer of security to trust accounts.
• Secure Document Sharing: Use secure document sharing platforms like Box or Dropbox with encryption enabled to share sensitive trust documents.

It’s important to remember that security is not a one-time fix. It requires ongoing vigilance and adaptation to evolving threats. Regularly review and update your security protocols to ensure they remain effective.

What if a Beneficiary Doesn’t Want to Use Secure Communication?

This is a common challenge. Some beneficiaries may resist adopting new technologies or prefer traditional forms of communication. In such cases, it’s essential to strike a balance between security and accessibility. A clear explanation of the risks associated with unsecured communication can often persuade beneficiaries to adopt more secure methods. However, if a beneficiary remains unwilling, consider alternative arrangements, such as providing them with physical copies of important documents or limiting the amount of sensitive information shared via unsecured channels. Remember, as a trustee, you have a fiduciary duty to protect the trust assets, which includes safeguarding sensitive information.

How Do I Address Digital Assets Within the Trust?

Digital assets—including online accounts, social media profiles, and cryptocurrency—are increasingly common and require specific attention within an estate plan. A well-drafted trust should grant the trustee explicit authority to access, manage, and distribute these assets. It should also provide clear instructions on how to handle passwords, usernames, and other access credentials. Furthermore, the trust should address the ownership and transfer of cryptocurrency, which can be complex due to its decentralized nature. Failing to address digital assets adequately can lead to significant delays, legal disputes, and loss of value.

I recall a situation with a client, Evelyn, who hadn’t accounted for her late husband’s extensive collection of digital photographs and videos. The family spent months trying to access the accounts, only to discover that the passwords were lost and the accounts were locked. It was a painful reminder that even seemingly insignificant digital assets can hold immense sentimental and financial value, and proper planning is crucial.

What about the Prudent Investor Act and Cybersecurity?

As a trustee in California, you are held to the “California Prudent Investor Act,” which outlines the standard of care expected of you when managing trust investments. This standard now implicitly *includes* cybersecurity considerations. Failing to protect trust assets from cyber threats could be considered a breach of your fiduciary duty. This means you must take reasonable steps to safeguard trust assets from fraud, hacking, and other cyberattacks. This could include implementing robust security measures, monitoring trust accounts for suspicious activity, and educating yourself about emerging cybersecurity threats. A proactive approach to cybersecurity is not only prudent but also legally required.

Luckily, another client, Mark, was ahead of the curve. He had incorporated cybersecurity protocols into his trust administration process from the outset. When a phishing attempt targeted his trust account, he was able to quickly identify and block the threat, preventing any financial loss. It was a testament to the importance of proactive planning and vigilance.

At Moreno Valley Probate Law, we understand the complexities of trust administration in the digital age. We can help you draft a comprehensive trust document that addresses cybersecurity concerns and ensures the protection of your assets.

Steven F. Bliss ESQ. can be reached at (951) 363-4949.

Don’t leave the security of your trust to chance. Protect your legacy—and your beneficiaries—with a proactive and comprehensive estate plan. Contact us today for a consultation and let us help you navigate the complexities of trust administration in the digital age.