As the digital world becomes a bigger part of our lives, many people have accumulated a lot of “digital assets,” which are non-physical assets that exist online in electronic format. Most estate planning clients preserve these assets either for their sentimental value or financial value. Those held for their sentimental value include things such as digital photos, music, movies, eBooks, information and documents stored on cloud accounts, subscriptions, smart-phone applications along with the data stored on these applications, and social media accounts. Digital assets preserved for their financial value include cryptocurrencies, bank or investment accounts, credit card rewards, income-generating websites or blogs, digital videos or written works that produce income, email accounts, and digital copyrights or trademarks.
With the rise of digital assets also comes the increased threat of cybercrimes. Cybercriminals are able to steal information by hacking into online user accounts and then sell information from these accounts on the black market. They also target online investment accounts that produce substantial financial gain. A 2019 survey conducted by Morgan Stanley revealed that cybersecurity risk is a major concern for high net worth individuals. These individuals often seek attorneys who can help manage and protect their digital assets and help them navigate the legal framework controlling these assets.
Different states vary in their legal treatment of digital assets, but there are certain statutes that protect digital accounts from cybercrime. The Computer Fraud and Abuse Act (CFAA), for example, criminalizes the intentional access of a computer system without authorization. The Stored Communications Act (SCA) also prohibits the intentional access of an electronic communication without authorization. Violation of these acts is punishable by imprisonment and a fine. Additionally, all but a few US states have adopted the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA), which allows fiduciaries such as agents under powers of attorney, executors, guardians, and trustees to access a client’s digital assets upon the client’s incapacity or death. Without RUFADAA, it is more difficult for fiduciaries, particularly executors, who have a duty to protect a client’s assets, to collect digital assets upon a client’s death or incapacity. Digital assets that live “on the cloud” unclaimed and unmonitored by owners can easily become a target of cybercrime.