Trustee

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One who holds the beneficial interest in something to which it has legal title on trust for someone else (that someone else being a “beneficiary”). In English law, a trust has no legal personality distinct from the trustee who constitutes it; in America and other far-flung places the trust itself (as distinct from its trustees) has its own ontological identity and may sue and be sued.

Known on the continent (though they hotly deny it) as a “fiduciary”.

Trustees may come in many different personalities, shapes and sizes but an oft-observed visitor to the financial services birdbath is the common speckled corporate trust and agency services provider. This large, unwieldy creature offers paying agency, security trustee and custody services to institutional and wealth management clients and is fond of claiming indemnities for any vicissitude that may break them, and disclaiming any liability for unexplained failures of their own staff to carry out the essential basic functions for which they are being paid. Corporate agents will hotly bemoan their slim margins, have no upside exposure and demand that they are allowed to cry off the usual responsibilities expected of a prudent professional organisation in the financial services industry.

Nettling them and their legal teams about the absurdity of these terms which, courtesy of immutable policy, said legal teams will have no power at all to vary is tremendous fun. Nonetheless the idea that institutions as profit-focussed as Citigroup, State Street, Bank of New York Mellon, or JP Morgan Chase would bother with such an operationally intensive business if it didn’t generate pots of money is absurd enough to dispel this canard.

See also