The importance of digital asset planning explained

Digital estate planning

“Privacy is not something that I’m merely entitled to, it’s an absolute prerequisite.” — Marlon Brando

Bricks and mortar businesses are inexorably coming to the realisation that a substantial amount of their business value is intangibly trapped in information. For online businesses, practically 100% of their assets are made up of information and the most valuable of all happens to be related to individuals. Information such as visitor, member, and client contact details are eagerly captured by online companies. The deeper and more detailed it gets, the better it is for the online enterprise. The ability to create an accurate client profile is true power and online businesses know it. They fight tooth and nail to attract new members, sign up subscribers and remain in front of as many contacts as possible. Individuals’ contact information and whatever other identity-related data they can cram into their customer databases is precious and allows them to put a value on their company, even if that value is largely theoretical.

If companies go through all this trouble to get data, would it not follow that their executives would rather part with their coveted reserved parking spots before they  consider allowing a single, hard-earned entry to be removed from their customer relationship management database? Absolutely! As long as the online businesses we deal with are subject to a privacy law based on the OECD data protection principles, we can count on the fact that limited retention is legislated and should expect our data to be purged from their systems after a ‘reasonable period of time’. What we should concern ourselves with is keeping track of all the data that is out there in detailed online and offline profiles. Social networking sites, email systems, other data sharing systems, e-commerce marketplaces and online auctions all try to build detailed profiles to allow for customisation of marketing messages, the likes of which deliver real value to online advertisers.

With the near complete penetration of the Internet across all age groups, we are increasingly likely to hear the term ‘digital estate planning’ (DEP) from tech-savvy lawyers. A search for this term yields a mere 70 hits on Google at the time of this writing, but give it a try in a year or two, and it be entrenched in the legal vernacular.

With our information now spread across dozens, perhaps hundreds of Internet sites and corresponding numbers of back-end databases, DEP is easier said than done. Social networking sites such as Facebook likely consider their early policy of ‘no deletion, only deactivation’ to have been a key driver of explosive growth as their user base shot past 100 million. Other sites that may have been more ethically inclined did not have the same opportunity to rekindle relationships with returning users. With global pressure to adopt data protection best practices, more and more firms are finding that they need to offer options for purging individual information from their systems.

The potentially vast amounts of information about deceased, Internet-active individuals may well turn into an insurmountable task for many, or an expensive task for a legal professional who wants to delve into DEP provisioning. Sites such as Hotmail, Yahoo! and Google all allow next-of-kin access to the deceased party’s information upon presentation of proof of death and proof of relationship, but a process needs to exist to manage all such related activities. Such a process can be based on a solid foundation of privacy legislation but, from the subject’s perspective, it must be consistent with existing best practices for password management and profile maintenance.

It is important to remember that information represents the building blocks of our identity and beyond the proper disposal of our data-based estate resides the very real threat of identity theft. That threat is real and has been for years. Husnain Kazmi is Vice President for Bank of America in Southern California. Kazmi says that in 2004 alone, some 400,000 checking accounts were reportedly opened in the US and millions of dollars in car loans were approved in the names of deceased individuals. This particularly effective type of identity theft is called ‘ghosting’ and most often occurs as a result of orphaned data being harvested by IT-savvy criminals looking to profit.

Governments need to step in and proactively install legislation that will protect citizens. Provinces in Canada, for example, are taking steps to establish privacy legislation around medical records. Many in the health care system view the legislation as crucial to the successful implementation of the Pan-Canadian Electronic Health Record (EHR) system under development across the country.

Following best practices is vital, but not enough. While the discussion is rather morbid, we must encourage clients and loved ones to exercise common sense when writing obituaries and safeguarding death certificates. Donald Kerr, Deputy Director of National Intelligence in America, is quoted as stating the following on the Office of the Director of Naval Intelligence website, “Too often, privacy has been equated with anonymity; and it is an idea that is deeply rooted in American culture… but in our interconnected and wireless world, anonymity – or the appearance of anonymity – is quickly becoming a thing of the past… we need to move beyond the construct that equates anonymity with privacy and focus more on how we can protect essential privacy in this interconnected environment. Protecting anonymity isn’t a fight that can be won. Anyone that’s typed in their name on Google understands that.”

We may all soon be in need of an internet-savvy, privacy aware, digital estate planner.

Don't Let Your Digital Assets Die With You

Digital Estate Planning Law

The May 2013 issue of the Internet Law Researcher newsletter (which is available to members of the Duke Law community through Westlaw‘s GLILR database) rounds up a bibliography of legislation and articles related to digital asset estate planning. To locate the article in Westlaw Classic or WestlawNext, use the citation 18 No. 5 Internet L. Researcher 1.

Planning for death has always been an uncomfortable and difficult topic for most people, and the growth of social media and other online accounts has added a new layer of complexity to sorting out the affairs of the recently deceased. Author Ken Kozlowski describes the current situation as “a big mess” in which “the federal Stored Communications Act (SCA) [is] being cited as a reason for services such as Facebook to withhold access to deceased individuals’ accounts, passwords, stored photos, etc.” Five states have passed legislation related to control of deceased individuals’ online accounts, and undoubtedly more state legislatures will follow suit.

The Internet Law Researcher article recommends a number of publications from legal and mainstream sources, including the recent law review student note by Maria Perrone, What Happens When We Die: Estate Planning of Digital Assets, and the blog Digital Passing. The recommended resources offer tips for developing a plan to handle digital assets after death, and serve as a good supplement to the Goodson Law Library’s collection of estate planning guides, most of which do not discuss digital assets in detail.

What is Digital Estate Planning and Why Do I Need it?

Write out instructions for each package

Chances will be that you won’t be here anymore to tell your executor what to do with each part of your estate — I guess. Remember, your executor will have no way of knowing how you feel unless you spell it out in advance, so you will have to write a document clearly stating what to do with each item.

Take the example of Facebook — no, I’m sure you have an account over there. In 2009, Facebook explained the reason behind creating a memorials for people who left. These memorialized accounts can no longer be found in Suggestions or found by non-confirmed friends, and are a place for friends to share memories in remembrance. Sensitive information are removed, and nobody will access the account anymore. That’s fine, but without preparation about what you’d love to remove or to keep, potential issues can arise. Moreover, you could decide of what you’d like to be remembered for : videos, some text if you used to write, and so on. That’s also a sensitive option to avoid your facebook ghost Liking pages or updating statuses, like some do.

Digital planning
Digital planning

Another thing to keep in mind is that, if you decide to keep resources online, you may have to engage financial assets in it as well. If you want your blog, portfolio or videos online, you’ll have to pay a service provider for it, or make sure that your executor will set up a mechanism to cover those costs. Free hosting solutions can be a solution, if you are not afraid of losing your legacy if their terms change.

It may sound stupid, but once again be sure that this executor will have an easy access to each piece of the puzzle : will, password lists, instructions. It’s also a good to idea to give power of attorney to your executor, to be sure he or she will have all the necessary support from the legal point of view.

Is Your Digital Life Ready for Your Death?

A physical locker

If you have more digital assets which you own, you can also consider getting specific hardware designed to protect digital information. A perfect example would be a hard drive using complete encryption — without the proper password, nothing can be retrieved, and your assets are perfectly safe. You just have to be sure that your executor does know where the storage device is, and has all the keys to unlock it. The cons are simple: the locker must be physically accessible, undamaged (when sometimes defects appear over time, rendering your assets inaccessible), and you will have to physically access it to update it.

Clear rules needed for managing digital afterlife

Prepare a digital legacy locker

We used to have shoeboxes to store small items of great value. This means that you could do the same for your digital treasures. Some online companies have taken the lead in building virtual shoe boxes, preventing you the pain of setting the hardware, software, communication you’d need. Can’t make sure you have two copies  of your data in two separate places (in case of accident to the first copy) ? They will. There are plenty of resources online concerning the management of your digital goods after your departure. They are focused on three main axis: managing a memorial, they also help you on planning the future and split of your assets, and finally to prepare a last message, on different channels.

You will find a more complete list of online vaults services at the end of this ebook, in the bonus section. In the meanwhile, you can have a quick audit of the service you need. Depending on your estate size, you may require between megabytes to terabytes of storage.

Digital planning
Digital planning

Payment can also be a factor to consider. The services providers can propose either to store your shoebox for a monthly, a yearly fee — or for a one-time payment. For some, you won’t have to worry, since services can be free. However, price is not everything. You are going to give extremely crucial data to a third party. Would you rather deposit your life in a costly swiss vault or at your weird neighbors?

A last point to consider is that some services can also provide support to your grieving family once you’ve left — and this is also can be extremely worth the extras.