Question

QUESTION 3.

A joint account involves an account owned and operated by two or more individuals other than a partnership or trust. As a banker, how will you handle the following situations relating to joint accounts?

(a) Explain in detail the two incidents of Joint Accounts – Right of survivorship and Joint Liability – to Mr. & Mrs. Dacosta Aboagye who have requested to open a joint account with your bank

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(b) List and explain 6 clauses that can be found in a joint account mandate form.

Answer 1

a.) Right of survivorship - This clause is present in Joint accounts opened by 2 or more related people, in case of an untimely death or separation of any co-owner of the account the other account holder can claim full ownership of the account and its assets. As a proof have to bring death certificate or separation documents of the co-owner. In case of separation the joint account gets dissolved and assets may be divided among the owners

Joint Liability - According to this clause all owners of the joint account are equally responsible for all liabilities and debt payments.

b.) Either or survivor - In case of Either or survivor account, either of the co-owner can operate the account and at the time of an untimely death of the person the final balances would and interest if any would be provided to other co-owner

Anyone or Survivor - In case of Anyone or survivor account both co-owners can manage and operate the account and at the time of an untimely death the other co-owner has a choice to either close the account or continue it with sole ownership

Former or Survivor - In case of Former or survivor account only the first owner can operate the account, the other co-owner can operate the account only after the death of first co-owner and that too after showing valid proof of death

Latter or Survivor - In case of Latter or survivor only the second co-owner can operate the account and first co-owner can operate only after the death of first co-owner

Minor's account - In case of Minor account only the parent or the legal guardian appointed by the court can operate the account