The importance of sharing passwords…

Is a phrase you would not usually expect to hear from a law firm! However, the significant rise in digital asset ownership means that the transmission of digital assets is something that requires careful consideration.

When dealing with estates now, we are finding that more and more people are passing away without leaving any instructions for their executors or family members to gain access to their online accounts. This can create significant problems for personal representatives who wish to preserve digital assets of both monetary and emotional value.

It has been estimated that there are approximately £15bn worth of digital assets that have been lost in the UK alone, but this figure is rising on a daily basis.

The definition of ‘digital assets’ can take many forms including but not limited to the following:

• Blogs;
• Email accounts;
• Media stores and players;
• Online gaming sites;
• Online bank accounts;
• Stocks and shares dealing services;
• Social media profiles;
• Messaging services; and
• Auction sites.

Many of these companies (excluding online banks) will refuse to grant access to executors and beneficiaries in the event of the digital account holder’s death (even after the provision of a grant of probate/letters of administration), and some will even refuse to close the account until it has been inactive for a certain period of time.

It is important for individuals to realise that their family members may not know where to look online for their accounts or profiles, and may have difficulty dealing with these accounts even after they have been found. If you own any online assets which may be considered valuable after your death, such as domain names or detailed blog postings, it is advisable to include an ‘Intellectual Property’ clause within your Will, stating how you would wish these to be dealt with after the date of your death.

In addition to this, your family members may wish to gain access to sentimental photos and other information from social media sites and it is likely that they will not be able to access this information without personal login credentials. You should consider whether you wish for your family members to have access to this information. Facebook, as an example, allows account holders to specify what they would like to happen to their account in the event of their death. For example, the account can be ‘memorialised’ and you can specify a legacy ‘contact’ that will have certain powers in relation to your Facebook page. Alternatively, you can specify that your account should be permanently deleted.

By law, following your death, it is a requirement for your personal representatives to gather in all the assets contained within your estate, and provide details of those assets to HMRC. If they provide inaccurate information, withhold any information or do not investigate the estate assets adequately, HMRC has the power to impose a penalty upon them.

To clarify how important these investigations can be, you may be familiar with the USA case of Mac Tonnies who died suddenly at the age of 34 in Missouri. Tonnies was a blogger in his spare time, but this was completely unknown by his parents, who did not even own a computer. He had written two books during his life and after his death, some of his followers contacted his parents to make them aware of the impact his blog had on their lives.

After much correspondence between his parents and various blog followers (some of whom had met Tonnies and others who had simply followed his posts from afar), Tonnies’ parents agreed to meet with some of these people to better understand their son’s life. Following this, one of those followers was granted permission by his parents to hack into Tonnies’ laptop where a third book was uncovered and subsequently published posthumously in 2010. The content of Tonnies’ blog was also saved and then published in a book which was released in 2013. Without these people making contact with Tonnies’ parents, this book would never have been uncovered, and would have been lost in cyberspace.

In order to ensure that your executors and other family members are able to deal with your digital assets if they need to, we would advise our clients to keep a log of where they hold online accounts and store a hard copy of this with their original Will. A schedule of usernames and login details will also be useful; although it is important that you keep this confidential information somewhere safe and accessible by your personal representatives after your death (this could also be stored in a sealed envelope with your Will). This may need to be regularly updated since some accounts require password changes every 3 months, so it is essential to keep this information under review. (We would not advise storing passwords on your computer!)

If you would like any guidance on the issues raised in this blog, or further information on how to deal with a deceased person’s estate, please do not hesitate to contact Nick Giles – Managing Partner, Emily Hanley – Paralegal or any member of the Edwin Coe Private Client team.

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