N.Y. Estates, Powers & Trusts Law § 11-1.6: Property held as fiduciary to be kept separate

§ 11-1.6 Property held as fiduciary to be kept separate

(a) Every fiduciary shall keep property received as fiduciary separate

from his individual property. He shall not invest or deposit such

property with any corporation or other person doing business under the

banking law, or with any other person or institution, in his own name,

but all transactions by him affecting such property shall be in his name

as fiduciary; provided, however, that any bank or trust company, when

acting as fiduciary, whether alone or jointly with an individual, may

with the consent of the individual fiduciary, if any (who is hereby

authorized to give such consent), register and hold stock or other

securities (referred to in this section as "securities") in the name of

the nominee of such bank or trust company; and provided, further, that

any individual acting as fiduciary is authorized to direct any bank or

trust company incorporated under the laws of this state, any national

bank located in this state or any private banker duly authorized by the

superintendent of financial services of this state to engage in business

here (who, as private banker, maintains a permanent capital of not less

than one million dollars) to register and hold any securities in the

name of a nominee of such bank, trust company or private banker

(referred to in this section as "bank"). Such bank shall not redeliver

such securities to the individual fiduciary, who authorized their

registration in the name of a nominee of the bank, without first

registering the securities in the name of the individual fiduciary, as

such. But, any sale of such securities by the bank at the direction of

the individual fiduciary shall not be treated as a redelivery. The bank

may make any disposition of such securities which is authorized or

directed by an order or decree of the court having jurisdiction of the

estate or trust.

(b) Any bank shall be absolutely liable for any loss occasioned by the

acts of its nominee with respect to the securities so registered.

(c) The records of such bank shall at all times show the ownership of

any such securities and of those held in bearer form. Such securities

and those held in bearer form shall at all times be kept separate from

the assets of the bank and may be kept by such bank

(A) in a manner such that all certificates representing the securities

from time to time constituting the assets of a particular estate, trust

or other fiduciary account are held separate from those of all other

estates, trusts or other fiduciary accounts; or

(B) in a manner such that, without certification as to ownership

attached, certificates representing securities of the same class of the

same issuer and from time to time constituting assets of particular

estates, trusts or other fiduciary accounts are held in bulk, including,

to the extent feasible, the merging of certificates of small

denomination into one or more certificates of large denomination,

provided that a bank, when operating under the method of safekeeping

security certificates described in this subparagraph (B), shall be

subject to such rules and regulations as, in the case of state chartered

institutions, the state superintendent of financial services and, in the

case of national banking associations, the comptroller of the currency

may from time to time issue. Such banks shall, on demand by the

fiduciary, certify in writing the securities held for such fiduciary.

(d) Any person violating any of the provisions of this section shall

be guilty of a misdemeanor.

(e) This section shall apply to all estates and trusts now in

existence or which may hereafter come into existence.