Discussion in 'Coin Chat' started by Randy Abercrombie, Jun 22, 2022.
Hugh Wood Insurance
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I believe account holders are considered creditors, but not renters of safe deposit boxes.
Have you read a contract, or just believing what you would assume?
Depends on what is written in the contract you signed.
I read the contract moments ago. There is nothing indicating, either explicitly or implicitly, that the bank has any right to the contents of my boxes, other than to compensate them for past rent if I should fail to keep current, and that is only after notice is properly served and a specified amount of time elapses.
I have received no addendums to that contract.
Funny story. One year they advertised a coin as being counterfeit. That didn't go well and the coin was pulled from the sale.
Correct, reason: The contents do NOT belong to the bank, and they cannot be liquidated to pay the bank's debtors.
Holders of safe deposit boxes don't need luck to protect their contents against a "Bail-In", as those contents are not "Deposits" with the bank, and are not covered by the Dodd-Frank legislation.
Still, it is important to suitably insure those contents against damage / loss, as the bank does not do so.
I have, but apparently you haven't. Here's a typical one:
Read the section with the heading "CONTENTS NOT INSURED."
No, you are not a creditor of the bank, nor is the bank a bailee. The bank has no right to handle or control the contents unless a) you fail to pay the rent, b) in response to a properly executed warrant, or c) the bank reasonably believe contents present an immediate threat or offense.
In Florida, the bank has to hand over any unclaimed property to the State and then the State liquidates it at a live (usually) public auction.
(The next one is scheduled for the beginning of August I believe.)
But if the bank is closed, how do you get in to get your stuff?
If the bank closes, it will notify box holders to make appointments to empty their boxes (and, presumably, receive pro-rated refunds for unused rental time).
In the U.S. it depends on how it closes:
If the multi-branch bank decides to shut down a branch, they send a notice to all box holders well ahead of time. A typical notice includes dire warnings about what happens if you fail to remove the contents -- typically they drill out the box and turn the stuff over to the state's unclaimed property division.
If the bank goes into insolvency or is seized, the FDIC steps in. They find another bank to take over the branch either temporarily or permanently and the bank reopens on the next business day or the day after. If the opening is temporary, they send out a notice as above. If permanent, then they assume the lease agreement and when it's time for renewal, you get to deal with a new contract with new terms and often at a new price.
If they close a branch temporarily, as happened to my branch during the COVID shutdowns, you have to make an appointment to visit your stuff.
So basically, if you put your eggs into one basket, you'd damn well better pay attention to that basket.
What if the bank has failed?
If the bank recently failed, the FDIC or the bank that assumed the failed bank’s business may have the account or safe deposit box contents. After a period of time, the FDIC or the bank must transfer unclaimed property to the state. Federal law requires unclaimed deposit accounts to be transferred to the state after 18 months, and state laws differ on the period of time after which contents of safe deposit boxes must be transferred.
So I guess you just have to prove what is yours.
You had to look a little deeper at that site:
4. If the bank fails, you'll still have quick access to your safe deposit box. In general, the full contents of your box should be available the first business day after the bank closes.
Everyone knows it’s decided in court if there are two different interpretations. It just depends on how much someone is willing to pay to prove if they are right.
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