The Benefits of a Trusted Contact

Have you ever wondered what would happen if you suddenly became unreachable, incapacitated, or started displaying erratic or unpredictable behavior? If a financial institution suspected you were the victim of fraud, or if you started displaying signs of distress or a lack of mental clarity? How could they verify your safety?

Imagine this scenario:  Larry, a widowed and retired gentleman, goes to his bank to request a large sum to be wire transferred overseas. He has been a long-time client of the bank. Jason at the bank knows this type of request is not in line with the way Larry usually conducts his business. Jason begins to ask questions and discovers the funds are going to help a new friend that Larry met on the internet.

Fraud is suspected, but what can Jason do? Fortunately, Larry had named a trusted contact. Jason now has permission to contact the trusted contact to discuss the situation.

What is a trusted contact?

A trusted contact is someone who you authorize your financial institution to contact in limited circumstances, such as if they cannot reach you or have a reasonable belief that you may be a victim of financial exploitation, or to check on your health status.  

Naming someone as a trusted contact does not give that contact any authority to act on your behalf, execute transactions or engage in activity in your account. It only allows your financial institution to communicate with them in case of an emergency or a red flag.

Why should you name a trusted contact?

Naming a trusted contact can provide several benefits for you and your financial institution, such as:

• Confirming your current contact information and health status

• Confirming the contact information for other authorized parties on your account, such as a legal guardian, executor, trustee or power of attorney

• Discussing urgent, unusual or suspicious account activity or other possible red flags

• Protecting your account’s assets and preventing financial exploitation or fraud

• Signaling to consumers that your financial institution is taking steps to help protect your assets and prevent financial exploitation

Who should name a trusted contact?

Anyone who has a financial account should consider naming a trusted contact.

Who can be a trusted contact?

You can choose anyone who is at least 18 years old as a trusted contact. However, it is recommended that you do not select someone who is not already authorized to conduct business or receive information on your behalf, such as your investment advisor, trustee or power of attorney. Trusted contacts are usually family members or close friends who you trust and who are likely to be in the best position to know your current situation.

How can you name a trusted contact?

You can name a trusted contact when you open a new account or update your account information at your financial institution. You may also be asked to add a trusted contact when you log on to your account online or receive a notice from your financial institution via e-mail or regular mail. If you do not receive a notice, and you would like to add a trusted contact to your account, you can contact your financial institution or your financial professional and ask how to do so.

The number of trusted contacts you can have may vary by financial institution, but typically you can have one or two. Trusted contacts are often applied to your entire relationship with your financial institution, so you do not have to worry about naming individual contacts for each account.

Naming trusted contacts for your financial accounts is a simple but important step that can help you protect your money and your well-being. It can also help your financial institutions provide better service and security for your accounts.

By adding a trusted contact, you can have peace of mind that someone you trust will be able to communicate with your financial institution in case of an emergency or a red flag.

Lynn Corthell, IACCP®, Chief Compliance Officer