Etana is a Financial Custodian. Unlike a bank where a deposit creates a debtor-creditor relationship, a custodian holds the assets of the client with the purpose of safe keeping. Account ownership remains vested in the individuals or entities for whose benefit the custodian is acting and the assets are not subject to the claims of creditors as client assets are kept separate from those of the custodian.
Since assets held in custody remain the property of the person or entity in whose name they are held (title is held by the account’s owner(s), it follows that none of this property is subject to the claims of the creditors.
As a result, a failure of the custodian will have no adverse effect on custodial accounts as they remain the property of the account’s owner(s). Therefore, the safety of custodial assets is not dependent upon whether the custodian has assets greater than its liabilities. Property held in these accounts belongs to the owner(s) of the accounts and would be unaffected by any failure of the custodian.