How to Handle Money in a Joint Bank Account

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It’s not uncommon for a person’s name to be listed on a bank account with someone else, perhaps an aging parent or a sibling who needs help administering his or her affairs. Depending on how the account is titled, however, the added individual could actually get in a lot of trouble for taking the money without permission.

If someone has taken money out of your account without permission, contact our experienced bankruptcy attorneys for help determining the next steps to take.

Understanding South Carolina Joint Accounts

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A bank account that is held in joint tenancy with the right of survivorship belongs to all owners. Where the owners are married couples, the law presumes that they may not necessarily contribute money equally; however, the money is 100 percent owned by both people equally. This means either spouse can withdrawal the entire amount with or without the consent or permission of the other. Hence, this is a good reason to make sure you trust your spouse before opening a joint account.

However, the rules get a little more complicated when accounts are held by non-spouses. In the case of Vaughn v. Bernhardt, the South Carolina Supreme Court held that funds held in joint tenancy between an elderly man and his nephew were jointly owned “in direct proportion” to the funds that were contributed by each owner. In other words, the nephew contributed NO money to the account and maintained no true ownership interest. He was ordered to pay the money back to his uncle’s estate after the uncle died.

Reasons Behind Protecting Interests of Joint Account Holders in South Carolina

It’s tough to draw a clear line between what is a fraudulent transaction and what is not, but courts will generally look to the purpose of the funds. If an older adult in your family establishes a joint account and wishes for you to be on the title to that account, you should insist upon drawing up a contract or some other form of documentation, where that person instructs you on how to use the funds and what share is free for your use. Otherwise, if you take the money, even though it may technically be 100 percent yours to keep under the right of survivorship, an estate executor could arguably fight you for possession of the funds after the person dies. This is because courts will seek to protect not only the decedent’s wishes but also the rights of any heirs who may have been defrauded.

Civil vs. Criminal Penalties in South Carolina

There are both civil and criminal consequences to mishandling or misappropriating the funds of a senior, even if held in a joint bank account. To qualify as a crime, there must be malice. In other words, there are statutes that can be used to bring charges against you for conversion (“theft”) or elder exploitation, but this requires that you acted intentionally to deprive that person.

On the other hand, civil damages may be awarded if the person’s guardian (if alive and disabled) or executor (if deceased) decides to sue you for the money. These cases can be very complicated and involve multiple areas of law, ranging from criminal charges to probate and guardianship laws, as well as financial and banking regulations.

Be Proactive! Retain a Charleston, SC Bankruptcy Attorney Today

If you have been given the responsibility of managing money for a loved one, you should speak to an experienced attorney right away. Make sure you understand your obligations and rights so that there are no misunderstandings or mistakes. If you’ve already been accused of wrongdoing, you need an aggressive litigation attorney who can protect your rights and help you avoid steep penalties. Contact the David Aylor Law Offices today to speak with one of our talented attorneys about your situation.

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