Question

A bank fiduciary may rely on the beneficiary approval to engage in self-dealing transactions provided:

a. At a minimum, the bank obtains the approval of all vested beneficiaries and disclosure of all facts of the transaction are well documented in writing.
b. All beneficiaries are sui juris.
c. Such approvals are specifically authorized by terms of the governing instrument and/or local law.
d. All beneficiaries are represented including guardians ad litem appointed to represent minor, incompetent, or unborn beneficiaries.

Answer 1

A bank fiduciary may rely on beneficiary approval to engage in self-dealing transactions if certain requirements are met.

Step-by-step explanation:

A bank fiduciary may rely on beneficiary approval to engage in self-dealing transactions under certain conditions:

• Minimum Requirements: The bank must obtain the approval of all vested beneficiaries and document all transaction facts in writing.
• Beneficiary Competency: All beneficiaries must be sui juris, meaning they have legal capacity and are competent to make decisions.
• Authorization: Such approvals must be specifically authorized by the governing instrument and/or local law.
• Representation of Beneficiaries: All beneficiaries, including guardians ad litem representing minors, incompetents, or unborn beneficiaries, must be represented.