H.B. 176 Trust Business Modifications: transcript

You, Mr. Chair. And I had a slideshow, but because of time, I'm just gonna forego my slideshow and just go into my presentation. Alright. Um, so as a bit of background, I mean, you've, uh, the committee had a bill file opened in the interim to, um, look at addressing the, the gap that we currently have. Um, right now, under our current state law, we have, uh, a provision in which individuals are able to act on an occasional basis as a trustee. Um, and that's used if you have a family trust, uh, to have family members serve in that capacity. But the hard part is, and I don't know how it is for your families, but in, uh, a lot of the families that I meet with, sometimes those individuals don't have the qualifications or to make any one of the children the trustee would cause internal conflict, um, and additional friction. And so, uh, the under state law right now, the only option they have is a trust company, which is an a depository bank. And so, uh, for a variety of reasons, sometimes that's not the best fit for what they're looking for. Um, I'll give a an example of one of my, uh, clients where they were just looking, all their sole asset was a home. And so that was in their trust. And so effectively the, they just needed somebody to sell the house and distribute the assets to the beneficiaries. Um, there have been times where attorneys or CPAs have operated as trustees, and they operate under that occasional provision, but it's not defined. And so at what level does that now enter into the trust business where they have to be regulated as a trust company? Um, as looking through this, we were researching how that's treated in various states. And so, uh, noticing that in a lot of states, they're, they fill that gap by allowing CPAs and attorneys to kind of be in the middle where they have, uh, their professionals, they're regulated by their own bodies, but there's a bit of risk because they don't have the, uh, the backing like an, uh, a bank would have where they have a lot more testing and insurance requirements. And so, um, this would allow individuals and families to be able to maintain the relationship with their CPAs or trusts or attorneys in those situations. So what this bill tries to do is kind of fill in that gap. Um, it carves out and allows attorneys and CPAs, not firms, so the individuals to be able to act in that capacity. Um, it also, uh, addresses the issue of marketing to the public. So there is a prohibition in this. This is more for attorneys or CPAs that have an established relationship with a client, and that client wants to utilize them in this capacity. Um, and then the other provision is that when an attorney is the drafter of the bill, there may be a conflict. And so the attorney has to provide a written disclosure, informed consent that the person is, uh, understanding standing it, um, that what the risk that entails and that they're consenting for the representation. And that's what, uh, and I'm speaking to the first sub, and that's what the first sub does.

Thank you, Mr. Vice Chair. Just a, a quick question. What, so I can understand it better? What is the problem you're trying to solve with the bill? Yeah, that's great. Thank you, Mr. Chair.

Yeah, that's great. Thank you, Mr. Chair. Um, and I forgot to mention, I have, uh, Jeff Cardin with me. He's an estate planning attorney. Uh, and he's here on behalf of other estate planning attorneys that are also dealing with this issue. And the problem we're trying to solve is that right now it is not very clear about attorneys and CPAs being allowed to be trustees. Um, it's really clear if it's like a family member, 'cause it's a very limited basis, but sometimes attorneys will have a few different clients ask them to be trustees, and at what point in time does that exceed the occasional scope? And so we're trying to figure out how do we provide, allow them to provide that service without violating the law and requiring them to hit all the requirements that an institutional bank would have to do.

Uh, yes. Just two questions. I know you came to us in the interim. So does this sub reflect all of the, um, like banks and, and such that, that wanted to be at the table? And does, how does this, uh, relate to, to the changes that they wanted?

Well, I didn't bring this bill to the interim. That was a committee bill file. I was just, had an interest in the subject matter, so I I talked about it. Um, so in the conversations, the, the, the comments that were raised, um, were dealing with the scope of how much business a attorney or CPA could take. And so we wanted to limit that in this bill to only the individuals. They weren't out there competing. The second was also the prohibition of advertisement, which was also something that was discussed, um, with them. And then the conflict of interest, that provision was also done. Um, and so it incorporates some of the stuff that we had been discussing with the banks. There is some disagreement and there's things that we're still working on to try to come together because other states are more permissive in allowing attorneys and CPAs to do it. And they're, uh, there's some differences of what that looks like. Um, but we're still having those conversations.

Okay. That's what I wanted to know because I, I think in my mind right now, I'm thinking if, if I trusted a particular attorney or lawyer, maybe that I didn't have, know that, well, there's no guarantee that I'm gonna get my money back or that this is going to be turn out well. Whereas, you know, uh, otherwise I have more of a guarantee. So I, anyway, I think that's really important to know if you're still working on negotiations, where that is in the process. Um, and the guarantee that I may have in, in putting together the trust that the, this particular lawyer as my trustee is, is going to be viable. We just don't have that process very well. And as you said, it's not very well explained, so I just wanna make sure that there's clarity if we're actually gonna change the law. Did, Did you want me to respond? Just, okay. I thought it was a comment, but, Uh, was that a question?

Okay. Question.

Um, so in response to that, I, uh, I, I'm happy where the bill is at this current point, and I'm happy to have additional conversations and continue to do it. Um, what I think is interesting is that currently under the law, a family member with no experience, with no liability, no professionalism and no insurance can fill this capacity. But if we want to have a CPA or an attorney step in that role, they now have to meet capitalization requirements. They have to go and, uh, be regulated by DFI. And in this situation, attorneys are already acting in this capacity already. In other contexts, I can have millions of dollars in my client, my client trust fund, but in a personal injury matter. But once I say that's for a trust, all of a sudden now I have to be regulated. And so there's already, uh, there's already professional, um, guardrails in place for this. Now, when I, I I've been doing research in it, and one of the things that it talks about in various states is that there is this part where there is an assumption of risk to some level, right? When you go to a trust company with a bank, they're gonna be able to do, provide certain protections and fill a certain need, but that need is not filled in all situations. And an individual may want to have a little bit more flexibility and that bank might not be able to do it, and they don't have the, that option at the moment here in Utah. And so that's what we're trying to, to mirror in other states.

Okay. I just think hearing from the, from other institutions will be helpful to make sure that we're, that, um, the process is, is speaking for itself. Thanks.

Hello. Uh, my name is John Grossman. I am a Senior Vice President of Bank of Utah and over the corporate trust department at Bank of Utah. Um, as drafted, first of all, I want to thank re Representative Loubet. We did speak quite a bit on this, and he has reached out to us, um, on, on drafting the bill. Uh, my concern is, as drafted house bill 1 76 risks, unintended consequences. Um, as Representative Ballard mentioned, um, I think as we open, uh, the trustee authority to attorneys and, and CPAs without imposing corresponding regulatory framework, um, we are not going to have the independent oversight that, um, the protections that are in place right now by having financial institutions handle this. I think the result is that the consumer, um, especially vulnerable beneficiaries would have diminished protections and fewer clear avenues of accountability, uh, if those expanded powers are, uh, misused where, uh, banks and financial institutions right now that are acting as trustees, uh, certainly have a, a high level of oversight and, uh, regulatory, uh, supervision. Uh, that's, uh, Okay. Thank you. So, So we would oppose. Okay.

Thank you. So, when Bank of Utah refuses to act as a trustee for a trust, who do you recommend they go to, Uh, another financial institution? What, what if, what if no financial institution will take the case? Uh, as mentioned previously, family members, uh, have the ability to, to act as trustee as well. So you would rather have my brother who's a truck driver than Anthony, who's an attorney, run my family's trust.

Uh, I, I just don't know a lot of the details in that situation, but, uh, well, it's not just the, the way you say it. Um, Hypothetically, a family member who has absolutely no training in the law or finances would be preferred to a CPA or an attorney.

The way that you answered the question, Uh, I would say that the, the way the law's written right now is something that we would support. We would also support expanding this, uh, this bill to have more controls and regulations over CPAs and attorneys. We're not opposed to the changes we're just opposed to how the bill is drafted right now.

Yeah. Di Dylan Smoots, also with Bank of Utah. I manage the personal trust department. Representative Thurston, I'd love to maybe address your question in a second, but I wanna start by just quickly describing, Can, can you get closer to your mic? Yeah. Sorry. Can you hear me better now? Yes. I, I wanna start by just quickly describing the significance of acting as trustee. Um, when, when you step in in the capacity of trustee, you essentially, for all intents purposes, you take over the decision making and the management of whatever assets are associated with the trust. You, you take over the management of marketable securities, non-marketable securities real estate. And, um, one of the things that is that financial institution with trust powers is subject to, is regulation. And we happen to have fantastic, uh, a fantastic rapport with our regulators. And we spend about three months of our year going through regulation related questions between internal exams. Were regulated at the state level, at the federal level by the FDIC. We have probably 15 to 20 people come into our office for extensive periods of time. And they go through everything that we have done from looking at our trust document to validating the decision making that we have and the consequences associated with, um, not adhering to those are, are severe. And Representative Thurston, if I can just real quick maybe address your question. I think one of the key differences here between maybe a family member acting is the potential damage that can be perpetrated onto the public. So in that instance, they manage one single trust as a family member, as a regulated financial institution, you can build a business out of it. Your potential damage is far more reaching if you chose to be fraudulent. And I don't see anything under this, this bill as its drafted now, that would prevent an attorney or an estate, uh, an attorney or a CPA from acting in the same business as a regulated financial institution.

Chairman. My name's Howard Headley. I'm the President of the Utah Bankers Association. I'm here to speak in opposition to this bill. We've been talking about it for over two years now. And my testimony is the same. We're we're willing to sit down and address the issues. There are problems to be solved, no question in terms of access and Representative Thurston, I'm very sympathetic to your situation. Um, but the answer is not to just give a blanket exemption to all CPAs and all the attorneys 'cause they're also perfectly trustworthy and there's no risks at all. 'cause that's not the case. You can't put a blanket exemption like exists in this bill without any new regulation. It's not safe for consumers. If, if someone runs off with the money, if someone abuses their license and loses their license, where do they get their money back? What's the recourse? None of those questions have been answered in this bill and it's very frustrating 'cause we've talked about 'em. I thought we were close to getting to 'em. But then we have a substitute today that comes in and just gives a blanket exemption to every CPA and every attorney in the state of Utah to take control of people's assets. Complete control. There's accountability. Yep. They can be charged, they can lose their license. But where do these people get their money back? There's no insurance requirements, there's no bonding requirements, there's no capital requirements. These are the difficult issues that I identified more than two years ago that needed to be addressed and have not been addressed. This is not a solution. There is a problem, Representative Thurston and very sympathetic to it, but this is not the solution.

Thank you Mr. Chair. Howard, thank you for your testimony. I I don't know this area, so I'm gonna rely on all the professionals that are here. Is there requirements for insurance bonding right now? If that trustee is your uncle or your cousin? Is there any protection now?

No, but there's no motivation either, right? I serve as trustee of my family trust. I'm not compensated, I'm not going out trying to make a business of it. And so that's, that's the other side. The answer is not just unleash every CPA an attorney in the state to build a business around this without any additional regulation that they currently exist as as, as CPA or an attorney. There's a reason why banks are regulated the way they are in this area because millions and millions and millions of dollars are at stake. It's a serious deal. And you can't just sidestep that, that you're talking about the occasional exemption. And that's why we started this. We wanted to put some guardrails around the word occasional because people were doing things under the name of occasional that were not occasional. And now those same people are coming to you today and saying, just exempt us, just exempt us completely from it. And it's like, are you kidding me? They were right back to where we were in 1980 when we had all kinds of failures and problems and people lost money. And we moved this all into the regulated financial institution space. We're just repeating history again. And this is all, we've all had these discussions over two years and I'm, I'm disappointed that we're here.

Thank you Mr. Rice Chair. So Mr. Headley, I'm, I'm sympathetic to, to what you're saying, the need for bonding and insurance on, on, you know, larger substantial trusts that, you know, you've got securities, you've got business interests, you have all those sorts of things. But, but then there's also the, you know, the family business, the, the smaller trusts where they, they don't know where to turn. And, and you know, I've, I've done enough estate planning work that for the smaller situation, when you get a bank or a trust company, the fees just can, can eat up the principle of the trust very quickly. So, so I I'm just curious that I think the way this is drafted, that they're not supposed to be able to go out and build a business, right? They can't advertise and they can't go out and promote themselves as being a trustee. It's basically your own clientele. When, and, and I face, that's one of the toughest questions when you do a trust, who do you trust as the trustee? Well, this child is this and this child is that, and the dynamics change. And you know, those are those situations where they say, well, can't you just do it? I mean, I've never done it personally, but, but I'm just curious about that. Isn't there a need for something like this? You

Have described the problem perfectly representative. You've described it perfectly, and it's what we endeavored to, to resolve in this process. Um, there's a reason why it's expensive to go to a trust business in a bank. It's highly regulated, right? It's highly regulated. There are costs involved. The answer is not to insert a whole bunch of unregulated players into the system because it's less expensive. If that's the case, let's get the regulation off the banks, right? Sure. Let's, let's, let's say, okay, you're already regulated a lot as a bank just for holding the deposits. Why are we regulated again for the trust services, but if we are gonna be regulated for trust services, certainly CPAs and the attorneys need to be regulated a little bit. Yeah, yeah, right. A little bit more than what they're regulated now. And apparently in the conversation we've been having, they don't want any more than what they're under right now. And I'm saying that's not acceptable.

But if, if I could I, and kind of the heart of the question then is, is there, are there not in here limits that they really can't go out and build a business. They can't go advertise and, and, and, you know, put up a billboard and whatever, it really comes from their own clientele. Is that help? Help me? Doesn't that kind of limit it for that?

Well, we've talked about limits. None of those are in this bill at this point. There is a limit on advertising, but they can't advertise today. There's nothing in this bill that doesn't apply today. The conflict of interest, we believe they would have to make that anyways. Right. It's nice to acknowledge that. Right. The issue comes down to if someone runs off with the money, how do these people get protect? How do they get the money back? Mm-hmm. You can Google any number of occasions. Yeah. They lost their license. They Uintah jail. But the family, the, that you're talking about, there was no recourse. If it happens at a bank, there's recourse. And that's what insurance bonding what help understand Capital, capital requirements. Yep. All of the above. Right. They're gonna get their money back. And frankly it's not gonna happen because we have examiners in our banks most of the year looking at files, finding anything that's not appropriate. So you, you don't read about those stories when it comes to banks. Right.

I i, if I may just one, one last question that very quickly please. That, that, um, is there some limit that you would suggest? I mean, smaller trust, uh, you know, some type of a limit for the types of situations that we're talking about where there is that need and, and there is a limit that the attorney loses their license.

You've got the fiduciary duty, they would go to jail. If this were just a competitive issue, a competitive fairness, a level playing field from a regulatory standpoint, we could probably come to agreement on some limit, um, of some type. But it's, it comes down to how do people, how do you protect people, right. Where do they get their money back? And those are the tough issues that we haven't solved in this bill.

Vice Chair. I'd like to make a motion to move to the next agenda item. Would you like to speak to that? Yeah, I think it's very clear that, uh, this bill is just not ready to go yet. And so I'd like to make that motion. Okay.

Yes. I'd like to make a response. Um, what is is frustrating with some of the misrepresentations, uh, how some of the requests by the banks made it so the bill would have been worse than the current status quo. And we have been trying to model this at a, after other states that have allowed these permissions, that have allowed this service available to the public. And that there was an understanding in these communities that by having a prohibition on the advertising, they weren't putting these services out to the general public. So I, I, uh, am not supportive of the motion. Um, I, if it's okay, I would like to have my cos speaker just respond to some of the questions, if that's permissible.

Uh, yes. That this bill deals with a lot more than just, than just Will you introduce yourself? Oh,

I'm sorry. Uh, my name's Jeff Cardin. I'm a trust and estates attorney. Uh, I also do a lot of corporate work. I practice in Pleasant Grove. Um, I, uh, and, and I've helped to craft some of the language here. Um, that's, that's proposed that, um, there's a lot more to fiduciary services in 2026 than there was in 1981. There's a lot of other things that go into, um, that go into providing these services to people across our communities. Um, I've got a colleague who's going to doctor's appointments and trying to Helper client who doesn't have anybody else help make medical decision. Um, and she's worried that she's gonna have to get, that she could get called on the carpet or that she could be against, um, you know, uh, uh, get, uh, have to be regulated by DFI just because she's trying to make a medical decision for somebody who doesn't have any other help. I've got, uh, I've got client or colleagues who are doing, um, working with clients who are in their multi-generational trust, people who've contributed to our communities and helped build this state into what it is today. And some of those trusts are in their third and fourth generations and they, and they have worked with banks and they have, uh, fired banks and they have found that it is more efficient for them, even in that upper end to work with their attorneys, that they save millions of dollars in fees, uh, because of, uh, the counsel that they get, uh, through their law firm and using their law firm to help administer their trusts. And so it is an important issue that, uh, there are just lots of other fiduciary services that have nothing to do with money management, have nothing to do with investment management. And, and so for those reasons, I would just encourage you to Alright, Thank you. Forward this bill favorably.

Sorry, I'd like to make a substitute motion. Can we, well, I know we have to adopt the first sub, but I'd like to adopt the first sub and pass it out favorably.

Sure. I think the sponsor is, has heard everybody's concerns and I think I'm confident that he can, uh, work with the committee and, and get this ready for the floor if we can get it out today. Okay.

Alright. I can't get my light off. Sorry. It's just one motion. So we, we have a, a motion and then a substitute motion. Oh, you're right. You're correct. Yeah. Back Representative chairman Lay, I, I would, uh, not support the motion. I think, uh, there's a lot of work that needs to be done and I think, uh, when I sum, I will make some comments, but I, that's, that's where I'm at.

I, uh, I appreciate the substitute motion and I'm supportive of it, and like my sub adopted and would love to have it recommended favorably.

I move that we favorably recommend.

I absolutely would. So this has been a study for the conversation currently in the law. CPAs and attorneys can do this occasionally. It's not well defined. Nobody knows what it means. They don't have to have bonding, they don't have to have regulation. DFI doesn't have have to get involved. They can just do it. The bill clarifies, it makes it more clear as to what occasionally means. It means that you can do it when you're asked. You can't advertise, you can't build a business out of it. It's what it means. You still don't have to have any newer requirements. And furthermore, I'm just really disappointed with the banks because I don't think that they've told you exactly the full truth. Um, I had a family trust. We asked the banks if they would do it, and they all said, no, we won't do it. And they did not refer me to anybody who could help me. They just said, we don't do that. We will not do that. So we were left on our own. We fortunately were able to read the law and find out that CPAs can occasionally do this. And we contacted a CPA who's a friend of ours, and he was gracious enough to say, yeah, I would be willing to do this and I'll be willing to help you out. And it's been fantastic. I'm not worried about him stealing our stuff. Like, why would I be worried about a CPA stealing my stuff? I mean, this is a guy who handles millions of dollars in client accounts anyway. If he's gonna steal stuff, he'd steal from them, not from me. So, and the same thing with, with attorney attorneys handle client accounts all the time, and if they're gonna steal stuff, they're gonna steal from the, um, personal injury accounts, not from me. So I'm not worried at all that, that, that we're somehow leaving our public susceptible to, to nefarious CPAs and attorneys who are out there looking to steal their stuff. So I am actually very appreciative. This moves us a giant step in the right direction by clarifying and making it clear to the public that you can in fact get a CPA that you trust, or an attorney that you trust who already do handle large amounts of money, and that they are already covered by regulations. And I don't think there's, there's any more chance of an attorney stealing my stuff than a bank stealing my stuff, other than the bank will call it a fee and they'll do it with a smile on their face. So with that, I am more than happy to recommend this bill be favorably recommended.

Uh, thank you, Mr. Chair. Um, I, uh, uh, appreciate the motion and I, I support it. Um, I will say that, you know, there's gonna be ongoing conversations, but to get those conversation happening and to start moving, uh, the bill forward, I would love that to help keep the conversation going.

Yes. Motion to adjourn.

Yeah. I actually oppose this mostly because we just had two other bills with the same, uh, thing that came forward, which is, it's great ideas, but to be able to work with others to make sure that the conversation and the collaboration is where it needs to be. It sounds like there were discussions, but not really a, a middle point that would work. And I think this is really important for the public. I think it's important for, for this industry. I think it's important for the trust of, of who you are trusting to put this together. So I, I think for the sake of the, this industry that is highly regulated. I think if they are, if they are including some kind of regulation or parameters, I think is a lot healthier. And I think bringing them to the table with you is what we've asked, um, previous, uh, sponsors of bills. Um, I didn't hear anybody speak in favor of it from the public. I only heard three speak against it. So other than a representative. So anyway, thank you. There Was no online comments.

Thank you. Um, so I had several individuals online that were gonna speak in favor of the bill, but for time we didn't go to them. So that's part of the reason why you didn't hear those. Um, we've had conversations. We will continue to have conversations. Um, I, I've been working with DFI as well to make sure if there's an apo, uh, spot where they wouldn't oppose it. Um, and so I would respectfully, uh, request this committee's, uh, favorable recommendation.

I apologize. I may have been a little bit harsh on the banks, but I have very sensitive feelings on this issue, so I apologize if I may have gone too hard on them. But, uh, I do feel like this is, this is something that we've talked about and from the very first moment we've just tried to figure out how to clarify what occasionally means. CPAs and attorneys can already do this. We just want to clarify what occasionally means. And I think the bill puts us in that right box. I think it moves us in a step in the right direction. Will we need to do more later? Probably. But at least it, it clarifies to everybody involved that you do have people that can help you. Alright. Alright. Thank you.

Thank you, Mr. Chair. All right. So, uh, house Bill 1 76, um, is trying to, is a first step in, uh, process. Um, right now under Utah law, if you were to try to get a trustee on your family trust, um, the only professional option you currently have is a depository institution, which is a bank. And most banks won't provide that service unless you hit a certain asset level of two to $5 million. Um, and even then, they have restrictions on what type of clients that they, they will work with. Now, there is a bank in Utah that does, uh, provide additional options, but at some point they also, uh, uh, require certain criteria before they will engage as trustee. Um, what, uh, this bill is, is trying to do is clarify and exempt out certain things that are not, uh, trustees. Um, so that way these people don't have to worry about, um, having to be registered as a trust company. So in the section of seven dash five dash 1 0 1, it talks about trust directors, trust protectors, trust advisors, surrogates and guardians as, uh, not being, uh, trustees. It also changes in lines 2 77 through two 80, the word person to individual. Um, one of the reasons for that is that, uh, it's, it was originally intended to be limited to like an individual, a family member, a friend. But because the word person was used, entities have been try, could potentially operate in its capacity. And we've seen that which has caused a problem. When an entity tries to do this on an isolated and occasional basis, that doesn't really work out and it usually runs afoul of the statute. And so we wanna clarify that this is more geared towards individuals. Um, an earlier version had exempted CPAs and attorneys, but we removed that piece, uh, from the bill 'cause we're gonna have continuing conversations with, uh, bankers associations, um, during the interim and the estate planning attorney section and the CPAs. So with that, that concludes my presentation.

Yeah, thank you, Mr. Chair. And, and I've talked to you about this before, but you know, as we've gone through the discussion of this and spent some time in the interim and things, so kind of help, help me understand the difference between you doing trust work and like holding access to and control of assets, you know, that might be in the trust. Does that make sense?

Sort of. So are you talking about like possession, like holding of the assets? Well,

So I know that in certain cases that if you're assigned as the trustee, as you know, as an attorney mm-hmm. Then you would have control over the, the trust, you know, so the, the assets of the trust, right? Mm-hmm. So, and is that, is that still the way that works or, Uh, in, in the bill?

Yeah. So in that bill, that part was taken out. Um, uh, one of the concerns that, uh, the Bankers Association had was just making sure that the language is spelled out regarding that. And so we were looking at other states to try to model our language, and we decided that it was best to continue those conversations. So with this version, the bankers, uh, association is neutral. Um, they're fine with where the bill is at this point. And so we're gonna continue having those conversations to kind of parse between the control of the assets, right? Because banks themselves hold the assets within their own accounts, whereas like an attorney, we have to use financial institutions. Um, title 75 B of the Utah code regulates trustees and trusts. Um, and so it has a list of duties and obligations, responsibilities, which include, you know, you can't self deal, you have to keep your, your money separate, stuff like that. And so we wanna make sure that we're clarifying how that would work with, um, attorneys or CPAs acting in that capacity. So then it's the way the bill is currently then, you know, as, as an attorney, you could do the, you could prepare the documents and those types of things.

Mm-hmm. Could you become a trust the trustee or,

Yes. Uh, under the occasional and isolated basis. That's already current law. That's usually how an attorney can do it. But they can only do it because it says occasionally isolated. This is one of those outstanding, uh, policy things that we're working on still is what does that even mean? And so right now it's used either narrowly or more liberally, and that's something that we're trying to figure out. How do we, how do we define that?

Thanks. Appreciate it. You're

Welcome.

Yes, my name is Jeff Cardin. I am an attorney from Pleasant Grove. And, um, uh, and I've, uh, want to thank Representative Loubet for bringing this bill forward. This is an important issue for estate planning attorneys, um, in working with our clients to be able to find professional fiduciaries to, uh, serve in a number of different circumstances. Um, since 1981, the banks have had a monopoly on these services, and it's, uh, and that the number of banks who have been providing services has been diminishing. And, um, yet clients, um, circumstances have not gotten any less complicated. It's gotten, um, more challenging to be able to provide services and to be able to find providers. And, uh, and so the, in an effort to try and, um, flesh out a little bit more about, uh, what trustees are doing and what, what is a, um, financial service under Title VII and what's not a financial service under, uh, title vii, um, it like specifically medical powers and trust protector powers and trust advisor powers, that those should not be considered financial services, um, subject only to, uh, being administered by banks. And so we've, uh, worked really hard with the banks to try and, um, to try and address their concerns and appreciate, uh, representative Lu Bay's efforts in trying to get this to a place where it can pass. Okay.

Thank you, Mr. Chair. I would make a motion that we fade, we recommend third substitute hospital, 1 76

for summation. Well, I appreciate the good senator's motion, Senator Vickers. Yeah, I appreciate the work you've been done on this. 'cause I know that's, it's been a sensitive topic for some time and, and getting according to find a balance that, uh, and I think it doesn't hurt to, to take a pause and look at it deeper. So I think that you're being prudent in that, and, and I look forward to seeing what the results of those discussions are.

Uh, thank you Mr. Speaker. Pro tem. Motion to circle Motion is to circle, we'd like to speak to it, Uh, briefly, uh, working on a sub to address a few little tweaks and should have that to go pretty soon.

Thank you Mr. Uh, speaker Pro Tem. Uh, this bill is cleaning up some areas of the, uh, trust company code, um, but it's also creating some exemptions that have already been granted other sections of code to people that this section is not supposed to apply to. Um, there's a little bit of confusion. So, uh, it's to clean up that trust directors, trust protectors, trust advisors, surrogates and guardians are, uh, this section is not applicable to, um, it also under the occasional and isolated exemption it had referred to a person. Um, but the concern with that was that a person also includes an entity. So what we do is we change the word person to individual that can act as a trustee, um, under the exemption and not have to worry about being registered as a trust company. Um, this bill also, uh, allows, um, oh, this bill took out the, or this substitute took out the, uh, CPA and attorney section, the exemption. Um, so that way the, we can continue that conversation during the interim. Um, this is part of a broader conversation. We're trying to look at ways to provide, uh, consumers with additional options for trustees. Right now, it's very limited to family members and friends or on an isolated basis, or you're looking at having to work with a trust company, which is a depository institution and sometimes that might not be the best fit. So we're gonna continue those conversations, um, and I will need a friend to help me adopt a sub three.

You Mr. Speaker Pro Tim, I would move, uh, third sub to HB 1 76.

No Thank you.

Um, everything I said applies to this bill, so thank you.

Um, everything I said applies to this bill, so thank you.

And to clarify that this section does not apply to the other areas of the code on lines 2 77 through two 80, in the occasional and isolated provision, the bill changes the word person to individual. This, uh, is to narrow the language and respond to concerns raised by the Bank of Utah and the Bankers Association that certain entities are trying to act as a trust company without being a depository institution. Uh, the remaining sections of the bill, um, are merely technical changes. And with that, I'll yield to any questions.

Thank you. Under suspension of the rules, I'd move that third substitute house Bill 1 76 pass.