§ 881 Digital Asset Disclosure Compliance

This law says that when a person dies, a company that holds their digital stuff must give the digital assets or close the account within 60 days if a legal representative asks, unless the company already has a lawful reason to keep it open.

Key Takeaways

•Custodians must respond to a fiduciary’s request for digital assets or account termination within 60 days.
•If a custodian refuses, the fiduciary can ask a court for an order to force compliance.
•The court order must say the request doesn’t break federal privacy law (18 U.S.C. § 2702).
•Custodians can say no only if they know the account is being lawfully accessed after the owner’s death.
•Custodians and their staff are protected from lawsuits if they act in good faith, unless they are grossly negligent or act willfully.
•A court order must also confirm the account belongs to the dead person and that there is proper consent to share the data.

Example

John dies and his daughter, who is his legal representative, asks his email provider to give her all of his emails or shut the account down.

The email provider has to hand over the emails or close the account within 60 days after getting the needed paperwork. If the provider says no, the daughter can ask a court to order them to do it. The provider can only refuse if it knows someone is still legally using the account after John’s death.

(a) Not later than 60 days after receipt of the information required under Sections 876 to 879.3, inclusive, a custodian shall comply with a request under this part from a fiduciary or designated recipient to disclose digital assets or terminate an account. If the custodian fails to comply with a request, the fiduciary or designated recipient may apply to the court for an order directing compliance. (b) An order under subdivision (a) directing compliance shall contain a finding that compliance is not in violation of Section 2702 of Title 18 of the United States Code. (c) A custodian may notify a user that a request for disclosure of digital assets or to terminate an account was made pursuant to this part. (d) A custodian may deny a request under this part from a fiduciary or designated recipient for disclosure of digital assets or to terminate an account if the custodian is aware of any lawful access to the account following the date of death of the user. (e) This part does not limit a custodian’s ability to obtain, or to require a fiduciary or designated recipient requesting disclosure or account termination under this part to obtain, a court order that makes all of the following findings: (1) The account belongs to the decedent, principal, conservatee, or trustee. (2) There is sufficient consent from the decedent, principal, conservatee, or settlor to support the requested disclosure. (3) A specific factual finding required by any other applicable law in effect at that time, including, but not limited to, a finding that disclosure is not in violation of Section 2702 of Title 18 of the United States Code. (f) (1) A custodian and its officers, employees, and agents are immune from liability for an act or omission done in good faith and in compliance with this part. (2) The protections specified in paragraph (1) do not apply in a case of gross negligence or willful or wanton misconduct of the custodian or its officers, employees, or agents. (Amended by Stats. 2024, Ch. 799, Sec. 7. (SB 1458) Effective January 1, 2025.)

Key Takeaways

•Custodians must respond to a fiduciary’s request for digital assets or account termination within 60 days.
•If a custodian refuses, the fiduciary can ask a court for an order to force compliance.
•The court order must say the request doesn’t break federal privacy law (18 U.S.C. § 2702).
•Custodians can say no only if they know the account is being lawfully accessed after the owner’s death.
•Custodians and their staff are protected from lawsuits if they act in good faith, unless they are grossly negligent or act willfully.
•A court order must also confirm the account belongs to the dead person and that there is proper consent to share the data.

Example

John dies and his daughter, who is his legal representative, asks his email provider to give her all of his emails or shut the account down.

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§ 881 Digital Asset Disclosure Compliance

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Related Statutes

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Key Takeaways

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Related Statutes

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