1. Definitions. In this Disclosure Statement, the words “you” and “your” refer to the client or clients who maintain accounts with Fiduciary Trust Company International (“FTCI”) and the words “we,” “us” and “our” refer to FTCI. Unless the context requires otherwise, the word “Account” refers to your Investment Management Account, Trust, Estate or Custody Account with us. “Checking Account” refers to your transactional demand deposit account with us. A “Deposit” refers to uninvested cash balances held in your Account or Checking Account. “Business Day” means every day except: (i) Saturdays and Sundays; and (ii) days that the Federal Reserve Bank observes as holidays and the New York State Department of Financial Services permits banks to close. The term “Network” refers to any ATM unit displaying the NYCE or CIRRUS network logo. We do not maintain our own ATM. The term “STIP” refers to the Short Term Investment Program, which is intended to provide an overnight investment capacity to you for all available cash in your Account, as described in Section 15.
2. Truth in Savings. We will designate your Account as a Money Market Deposit Account (“MMDA”), Negotiable Order of Withdrawal Account (“NOW Account”), or Demand Deposit Account (“DDA”), depending on your Account’s eligibility for such designation. DDAs do not bear interest; MMDAs and NOW Accounts are interest bearing. Transactions per month are unlimited in DDAs and NOW Accounts. MMDAs will be subject to our converting them to NOW Accounts or DDAs, without prior notice to you or your approval, in accordance with Regulation D, i.e., when we have determined, in our discretion, a pattern in the Account of non-investment transactions exceeding the prescribed regulatory limits. We reserve the right to require at least 7 days prior notice of the intent to withdraw funds from MMDAs. We calculate interest on Deposits by applying the current annual rate (“Rate”) to the average daily net Deposits in those Accounts that were interest bearing during the previous month, compounding interest monthly and crediting such Accounts monthly in arrears. At our discretion, without limitation, we may change the Rate and annual percentage yield (“APY”) on your Account. We disclose the current Rate and APY to you at the time you open an Account, upon your request made during business hours and by posting the information in the teller area of the bank.
3. Checking Accounts and Payment of Checks. We make non-interest bearing Checking Accounts, with no minimum balance requirements, available to existing clients with Accounts and to other persons or entities at our discretion. Except as set forth in Sections 12 and 13, regarding funds availability, we impose no holding period or other limitations or prohibitions on transfers between your Checking Account and your Account. We may pay checks or other items drawn on your Checking Account in any order we determine. Normally checks presented against your Checking Account will be paid, as received, from the lowest amount presented to the highest amount presented.
4. Substitute Checks (Check 21). To expedite check processing, we may replace your original checks with “Substitute Checks,” and return them or an image of them to you with your Checking Account statement. They are comprised of slightly reduced images of the front and back of your original checks and serve as proof of your payment. The front will state: “This is a legal copy of your check. You can use it the same way you would use the original check.”
Your rights and obligations under federal law to recovery of losses when you receive Substitute Checks from us are set forth in this Section 4. (These rights and obligations do not apply to original checks or electronic debits to your Checking Account.) If an amount is improperly or erroneously withdrawn from your Account or Checking Account as a result of a Substitute Check, you may request from us a refund for the total amount withdrawn, together with any fees charged to you (“Refund”), and, if your Account is interest-bearing, interest on the amount of your Refund. If your loss exceeds the amount of the Substitute Check, you may be able to recover additional amounts under other laws. If you use this procedure, you may receive up to $2,500 within 10 Business Days after we receive your Refund claim, and the remainder no later than 45 calendar days after we receive your Refund claim. These amounts include interest, if applicable. If we later demonstrate that we posted the Substitute Check correctly to your Account or Checking Account, we may reverse the Refund (including interest, if applicable).
5. Use of ATM and VISA Debit Cards (“your Card”). Customarily, at our discretion, we issue or reissue ATM debit cards with VISA debit functionality, which allows you to debit your Checking Account or Account for purchases wherever VISA is accepted. Nevertheless, FTCI will always honor your request to issue you a basic ATM card without the VISA function or to issue you no ATM card. We will ask for your preference when the Checking Account or Account is opened and any reissuing of future cards will be in accordance with the same preferences. Although we do not currently impose any fees for transactions on either ATM or VISA debit cards, we reserve the right to impose such fees with notice, as described in Section 22. We may cancel the use of your Card and the privileges associated with it at any time for any reason and without prior notice to you. Your Card remains our property and you must surrender it to us if we so request. In addition, an ATM may impound your Card at any time for any reason. To use an ATM, you will need a personal identification number (“PIN”) in addition to your Card. Your PIN will be issued to you after your Card is issued.
Only you may use your Card and you may not divulge your PIN to any other person. There will be only one PIN for each Card issued in connection with your Checking Account or Account. Separate Cards with a separate PIN will be issued to each account holder of a joint account. If yours is a joint account, or if you give another person permission to withdraw funds from your Checking Account or Account, any debits made by use of your Card will be binding upon you. You will maintain security over your PIN by not placing it on or carrying it with your Card.
6. Electronic Funds Transfer (“EFT”) Use and Fees. Except as set forth in Section 13, we impose no limits on how often you may use an EFT by ATM, VISA debit, wire or ACH (automated clearing house) transfer, nor do we generally impose any fees for making wire transfers, EFTs or using ATM or VISA debit cards, although we reserve the right to impose such fees in the future. Moreover, an ATM operator or network may impose a fee on you for a fund transfer or a balance inquiry even if you do not complete the transfer if you are notified of such fee at the time you use the ATM. We may cancel your ability to make an EFT and the privileges associated with it at any time for any reason and without prior notice to you. You have the right to stop a preauthorized payment by notifying us at least 3 business days before the scheduled date of the transfer. We may require that you provide us with written confirmation of your stop-payment order within 14 days of the notification; if you do not provide us with written confirmation, you may lose your right to stop the payment. If you require information on stop payments, please telephone or write the Banking Department at the telephone number or address indicated at the end of this Disclosure Statement.
7. Documentation of EFT. Confirmations of preauthorized EFTs are available by telephoning the Banking Department at the telephone number indicated at the end of this Disclosure Statement. Your periodic Checking Account or Account statement will show all EFTs during such period. You should be provided with a receipt from the ATM at the time that you make any withdrawal using an ATM.
9. Your Liability. Checks. If your Checking Account is debited for a series of checks bearing forgeries, alterations or missing or unauthorized signatures, you must notify us within 14 days after the Checking Account statement in which the first of such items appears is made available to you, or we will not be liable for losses resulting from subsequent occurrences.
ATM or VISA Debit Card and ACH Transactions for Personal Checking Accounts and Accounts (those primarily used for personal, family or household purposes). If you believe that your Card or your PIN has been lost or stolen, or if an ACH transaction is incorrect, notify us immediately. If you notify us within 2 Business Days after you discover that your Card has been lost or stolen or that someone has obtained access to your PIN, and if someone uses your Card or accesses your Checking Account or Account without your permission during those 2 Business Days, we reserve the right to hold you liable for such amounts, up to $50. If your Checking Account or Account statement contains unauthorized withdrawals or transfers, but you fail to notify us of this within 60 days of the time that your statement was mailed to you, and if we could have stopped someone from taking money from your Checking Account or Account by having such notice, we reserve the right to hold you liable for all charges (“Unlimited Amount”) that occur between 60 days after the statement was mailed to you and the time that you finally notify us. If the unauthorized transaction on your statement involves a lost or stolen Card or PIN, the Unlimited Amount for which we reserve the right to hold you liable is in addition to the $50 described above. If a good reason, such as a hospital stay, prevented you from advising us, we may extend the time periods. Please notify us of any of these events as set forth in Section 11.
ACH Transactions for Non-Personal Checking Accounts and Accounts. Your failure to report to us any unauthorized withdrawal from your Account within 2 Business Days of our providing you with verbal notification of, or an Account statement showing, such unauthorized withdrawal shall relieve us of any liability for any losses or damages sustained after the expiration of such 2 Business Day period.
10. Our Responsibility. ATM or VISA Debit Card and ACH Transactions for Personal Checking Accounts and Accounts. If a withdrawal from your Personal Checking Account or Account is not completed on time or in the correct amount, we will be liable for your actual losses and proximate damages (but not incidental or consequential damages), with the following exceptions: we will not be liable with respect to ACH, ATM or VISA debit card transactions if, through no fault of ours:
- Your transaction exceeds the limitations set forth in Section 13;
- You do not have enough money in your Checking Account or Account to make the withdrawal;
- The ATM you are using does not have enough cash to fund the withdrawal;
- The funds are subject to legal process or other encumbrances restricting such transfer;
- You knew of a technical malfunction when you attempted the withdrawal or when the preauthorized transfer should have occurred; or
- Circumstances beyond our control, such as, but not limited to, war, terrorism, fire or flood, prevent the withdrawal from taking place despite our reasonable precautions.
ACH Transactions for Non-Personal Checking Accounts and Accounts. We shall have no liability to you for any errors or losses you sustain in an ACH transaction, except when we fail to exercise ordinary care in processing any transaction. Our liability, in any case, shall be limited to the amount of any funds improperly withdrawn from your Checking Account or Account, less any amount that, even with the exercise of ordinary care, would have been lost.
11. Notification of Errors. As set forth in Section 4, if you believe that you have suffered a loss relating to our posting a Substitute Check to your Account or Checking Account, you must notify us within 40 calendar days of the date we mailed (or otherwise delivered to you by a means to which you agreed) the Substitute Check in question or the Account or Checking Account statement showing the posting, whichever is later. If a good reason, such as a hospital stay, kept you from telling us, we may extend the time period. To file a Refund claim, your claim should include:
- A description of why you have suffered a loss (for example, we withdrew an incorrect amount);
- An estimate of the amount of your loss;
- An explanation of why the Substitute Check you received is insufficient to confirm that you suffered a loss; and
- A copy of the Substitute Check and/or the following information to help us identify the Substitute Check: check number, payee and the amount of the check.
As stated in Section 9, if you believe your Checking Account or Account statement is wrong, or if you require additional information about a transaction listed on such statement, you must advise us, no later than 60 days after we have sent the first statement on which the transaction(s) in question appeared, of the following:
- Dollar amount of the questioned transaction(s);
- Your name and Checking Account or Account number(s); and
- A description of the error or the transaction about which you are unsure, with an explanation of why you believe it is an error or why you need more information.
If you advise us orally, we may require that you send us your complaint or question in writing within 10 Business Days. We will notify you of the results of our investigation within 10 Business Days of your complaint or question and will correct any error promptly. If we need more time, however, we may take up to 45 days to investigate your complaint or question. If we decide to do this, we will re-credit your Checking Account or Account for the amount you believe is in error within 10 Business Days of your complaint or question, so that you will have use of the money during the time it takes us to complete our investigation. If we decide that there was no error, we will send you a written explanation within 3 Business Days after we finish our investigation. You may ask for copies of the documents that we used in our investigation.
In case of errors or questions about your transactions or statements, telephone or write to your account or portfolio manager or to the Banking Department at the telephone number or address indicated at the end of this Disclosure Statement.
12. Funds Availability and Withdrawal of Funds. Except as provided below, we will credit and make available to you for investment purposes on the same day received, Deposits to your Checking Account or Account, if received before 3:00 p.m. Eastern Time (“ET”) on a Business Day, and cash received by us on your behalf, as a result of redemption of an investment, collection of income or any other event (“Cash Receipt”), if received before close of business (generally, 6:00 p.m. ET) on a Business Day. Except as provided below and to the extent set forth to the contrary in Section 2 with respect to your right to withdraw funds, we will make Deposits or Cash Receipts available to you for withdrawal on the same Business Day as received. We will consider any Deposit received by us after 3:00 p.m. ET, any Cash Receipt received after close of business, or any Deposit or Cash Receipt received on a day that is not a Business Day, to be deposited or received on the next Business Day.
We have the right to delay the availability of funds between 1 and 5 Business Days after the receipt of any Deposit, not to exceed the maximum number of days or amounts allowed for that type of Deposit, upon notifying the depositor of the time that the funds will be available in a written notification given at the time of the Deposit or by mail no later than the first Business Day after we receive the Deposit. We do not, generally, exercise this right, although we may delay funds that you deposit by check under these, as well as other, circumstances:
- We believe a check that you deposited will not be paid when presented;
- The check deposited is a third party check;
- You redeposit a check that has been previously returned unpaid;
- There is an emergency, such as failure of communications or computer equipment;
- We believe that the funds deposited will not be immediately available to FTCI; or
- We know that the Checking Account or Account is in the process of closing.
13. Funds Availability and Withdrawal for ATM or VISA Debit Cards. Although you may have available funds in your Checking Account or Account, we will honor withdrawals from your Checking Account or Account by ATM or VISA debit cards only up to a predetermined limit. Although the limit may be set at different levels at your request and our approval, the general limit will be $1,000 per day for ATM debits and $5,000 over 3 days for VISA debits.
Any ATM withdrawal made on a non-Business Day or after the close of business on a Business Day will be reflected the following Business Day. The end of the Business Day for ATM withdrawals will depend on the Network to which the ATM operator belongs and may vary from institution to institution within such Network.
Availability depends on the on-line status of the Network or the on-line status of the individual ATM unit at any given time. The withdrawal availability of funds from off-line Network or ATM units may vary greatly. Availability of withdrawals from ATM’s outside of the USA will vary according to the rules established by the foreign bank or the rules of private ATM operators common outside the USA. The foreign and private ATM operator’s rules supersede the established limits set by FTCI.
VISA is accepted worldwide wherever the VISA logo is displayed. Vendors may request the card be accepted by signature or by entering the pre-established PIN number attached to the card. Daily VISA transaction limitations will depend on limits we establish. We have established the general limit for VISA transactions at $5,000 on a rolling three-day cycle. We may agree to reset them from time to time, at your request and our approval. We do not have any control over the vendor presentment schedule nor the VISA cycle acceptance rules. As transactions are accepted by VISA, the pre-established limit is reduced, including pre-authorized transactions such as hotel check-in VISA holds. As transactions are validated and presented to VISA by the individual vendors, the cycle limit is reset against the limit we have established; transactions will be debited to your Account or Checking Account at the end of the business day cycle. The rolling cycle attached to foreign transactions may be delayed by an additional one or more days. Exchange rates on transactions denominated in foreign currencies are established by the foreign bank processing the VISA transactions.
14. Cash and Investments Subject to Escheatment. Pursuant to relevant laws and regulations, your cash and investments custodied by FTCI or cash deposited with FTCI may be transferred (“escheated”) to the appropriate state with jurisdiction (the state of your residence if you are a U.S. resident), if attempts to contact you to arrange for the return of your assets have failed and no activity has occurred in the Account or Checking Account within a specified time period (three years for securities held in an Account, and five years for cash held in a Checking Account, depending on the state with jurisdiction). Assets received for your benefit after your Account with FTCI has closed, in respect of tax reclaims or corporate actions (such as, legal settlements, distributions or dividends), may also be subject to escheatment.
15. Availability of Cash for the STIP. Your ability to withdraw funds in any manner will not be affected by participating in the STIP. Generally, all cash balances, including Deposits and Cash Receipts, available in your Account at the end of each Business Day (having taken into account all withdrawals that day, whether by check, wire transfer, ACH or ATM or VISA debit card), will be available for participation in the STIP, in excess of a predetermined amount, subject to negotiation between your account or portfolio manager and the STIP manager.
16. STIP Investment Strategy Selection. Your STIP “Investment Strategy” will be the investment objective for your overnight investment, generally consisting of between one and five (or more) external money market funds that conform to the investment objectives defined by the Investment Strategy. The Investment Strategies available may include, but may not be limited to, the following: U.S. government; U.S. government and agency; prime cash; funds for non-U.S. residents; general tax exempt; and individual state tax exempt, including strategies for NY, NJ, CT, CA and MA. The underlying investments within each Investment Strategy are subject to change from time to time at the discretion of the FTCI Asset and Liability Management Committee. Additional Investment Strategies may be added, as required.
You (if your Account is a custody-only account) or your portfolio manager (if your Account is a managed account) will be able to select the investment objective for your overnight investments by selection of a STIP Investment Strategy, and to change such selection at any time. We will make a reasonable effort to effect all requests for changes between existing Investment Strategies within 3 Business Days of our receipt of the request. Changes requiring new or modified Investment Strategies (if requested changes are feasible or possible) will be subject to such time periods as are reasonably required to effect such requested changes.
17. Investments for Each Investment Strategy. The STIP manager will determine, at his or her discretion, the daily allocation of investable available funds among the money market funds that comprise the STIP Investment Strategy selected. The money market funds will hold the STIP funds in an omnibus account in the record name of FTCI as agent for its clients. We generally will not provide you with the prospectuses of the money market funds in which your funds are invested, but will do so as a courtesy, upon your request.
18. Treatment of your STIP Investment. After your cash is swept to external money market mutual funds comprising your STIP Investment, it is not a deposit and is not covered by FDIC Insurance. If FTCI should fail, the FDIC will determine whether pending STIP investments will be allowed to sweep to the external money market mutual funds or be re-deposited in your account. If the cash is re-deposited to your account, it will be aggregated with your other deposits held by FTCI, and insured under the applicable FDIC insurance rules and limits, as described in Section 25.
19. Fees Relating to the STIP. We will not charge you an additional fee for using the STIP; many custody-only accounts, however, will be subject to a transaction fee with respect to their STIP transactions. With respect to managed accounts that are not for ERISA Plans, IRAs or trusts of which we are a trustee or co-trustee, we may enter into agreements pursuant to which we (or an affiliate of ours) may receive compensation for providing various administrative services that the investment managers would otherwise have to perform in relation to the money market funds.
20. STIP Investment Returns. Your return will be calculated daily and paid monthly using a simple interest rate calculation. We will apply the rate pro rata to the actual amounts invested from your Account for the time period that they were so invested. Although we are not required to provide the monthly allocation of the invested amounts or the calculation of the rate applied to your investment, as a courtesy, we will make that information available to you, upon your request. The value of your interests in external money market mutual funds at any time may be less than the value of your original investment in such funds if the share price of any such external fund falls below $1.00 during the time you are invested in such funds.
21. Approval of Loans and Letters of Credit. Loans and Letters of Credit issued to clients, or at the request of clients, are approved, and advances are made, based on the review and approval of the client’s collateral pledged to FTCI to secure the loan. No Loan or Letter of Credit to a client or requested by a client shall be denied on any basis prohibited by applicable law, including, without limitation, race, color, religion, national origin, sex, marital status, public assistance income, familial status, age (provided that the client and the borrower, if different, have the capacity to enter into a binding contract), or a client’s good faith exercise of any consumer protection right. If any Loan or Letter of Credit Application is denied, FTCI will give written notification to the client requesting the Loan of the reason for the denial.
22. Changes to EFT, ATM or VISA Debit Cards, Checking, STIP and Other Banking Services and Disclosures. We may establish additional terms and conditions pertaining to EFT, ATM and/or VISA debit cards by giving you a written notice at least 21 days before the effective date of any change, if the change would result in increased fees or charges, increased liability for you, fewer types of available EFT services, or stricter limitations on the frequency, or dollar amounts of transfers or withdrawals. We also reserve the right to change the terms and conditions regarding Checking Accounts and the STIP program or process upon 30 days prior written notice to you. You must notify us within 30 days of your non-acceptance of any changes. If you do not notify us, you will have agreed to such changes. With respect to the STIP program, a different standard may apply to ERISA and IRA accounts. If an immediate change in terms or conditions of use of EFT services, checking services or the STIP program or processes is necessary to maintain or restore the security of your Checking Account or Account or an EFT system, we would not be required to give you prior notice, but we would generally notify you with your next statement or within
30 days of the change.
23. Fees from Affiliated Funds. Fiduciary Trust and its affiliates will receive, and may share, compensation for investment management services from each fund advised by Fiduciary Trust or its affiliates (collectively, “Affiliated Funds”) in which the Account invests. These arrangements are described in the prospectus and statement of additional information for each such Affiliated Fund.
24. Client Commission Arrangements. Unless your Account is a custody-only Account, brokerage commissions generated from transactions in your Account may be used for research and brokerage services under Section 28(e) of the Securities Exchange Act of 1934, including both proprietary and third party research.
25. Extent of FDIC Insurance. Securities, mutual funds and other non-deposit investments in your account are subject to the following disclosure:
May lose value
No bank guarantee
Cash balances in your Checking Account or Account may be placed on deposit at FTCI or at other banks in the United States, and, if so, are insured to the maximum extent permitted under the FDIC's general deposit insurance rules in accordance with the Federal Deposit Insurance Act (further details can be found at www.fdic.gov/deposit/).
26. Recording of Telephone Conversations. To monitor the quality of the services that we provide, your telephone conversations with the Banking Department, or with your account or portfolio manager, may be recorded.
27. Customer Identification Notice. Federal law requires that we obtain, verify and record information and documents to identify the persons opening new Checking Accounts or Accounts. For natural persons, this may include, without limitation, name, address, date of birth, and Social Security numbers, as well as government-issued photo identification, and for clients, other than natural persons, tax identification numbers and documents evidencing formation (e.g., Articles of Incorporation). We may also screen your name against various databases to verify your identity.
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