Conservator Handbook - Probate Court Of Mobile County Page 6
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21Monies and Investments:
Restrictions exist regarding the manner of investing conservatorship assets.
You are
encouraged to consult with your lawyer before making any investment decision to insure full
compliance with applicable law.
Generally, a conservatorship estate’s investments must be backed (or insured) by the full faith
and credit of the United States or the State of Alabama. For example, funds deposited with a bank
should be fully covered by FDIC bank insurance. If the amount of assets deposited with a banking
institution exceeds the FDIC customer limit at said banking institution, the conservator should deposit
the “excess” funds (the amount that exceeds the FDIC insured amount) at a different banking
institution.
If a Ward owns corporate stock assets or other investment assets that do not comport with
Alabama’s investment rules at the time the Court entered the determination of incapacity, the
conservator may maintain said stock portfolio or assets in the form and manner the Ward maintained
them. However, if there is a loss associated with said asset, the conservator may be determined to be
liable for the loss if a reasonably prudent investor would not have maintained said asset in the form or
manner the Ward maintained the asset and the fact that said investment was created by the Ward prior
to the Ward’s incapacity is not a mitigating factor or consideration.
It is very important for the conservator to maintain written records to document and substantiate
investment decisions.
If a Ward owns corporate stock or other investment assets that do not comport with Alabama’s
laws regarding fiduciary investments AND said assets are liquidated by the conservator after the
determination of incapacity, said assets must be invested in accordance with Alabama law.
Title to Investments:
All investments must be properly titled in the name of the conservator for the benefit of the
Ward and the Ward’s name should be disclosed. For example:
“Joe Doe as conservator for Zac Roe, an incapacitated person”
Bank Accounts:
After you have been appointed as Conservator, you must open and maintain a separate bank
account for the estate funds. The account should be titled as follows: “John Doe (Conservator’s name)
as conservator for XYZ (Ward’s name), an incapacitated person”. You may never co-mingle the Ward’s
assets with your own money or that of any other person. For this reason, you may not use your own
bank account for depositing the Ward’s money.
Most Conservators deposit the Ward's money in separate checking accounts, savings
accounts, or Certificates of Deposit. If you wish to put your Ward's money into any other type of
account, you should contact your attorney and/or receive permission of the Court before you do
so. All bank accounts that you open for the Ward must meet the same legal standards as
investments so that the principal is always secure. This means that the accounts you open must be
with banks that have FDIC insured checking and savings accounts.
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