CONSERVATOR; PROHIBIT CRYPTO INVEST. S.B. 656:
SUMMARY OF BILL
REPORTED FROM COMMITTEE
Senate Bill 656 (as reported without amendment)
Sponsor: Senator Ruth Johnson
Committee: Civil Rights, Judiciary, and Public Safety
CONTENT
The bill would amend the Estates and Protected Individuals Code (EPIC) to require a
conservator that invested or reinvested estate property to invest with a brokerage firm that
was insured by the United States Securities Protection Corporation and to prohibit a
conservator from investing estate property in cryptocurrency. 1
Generally, EPIC prescribes the powers of a conservator, which include specific actions a
conservator may take without court approval, such as managing property, operating business,
banking, managing stocks, and performing necessary financial and administrative actions to
protect and administers a ward's estate effectively, among other things. A conservator may
invest or reinvest estate property, and if the conservator does so, the conservator must invest
or reinvest the property in accordance with the Michigan prudent investor rule.
Under the bill, along with investing or reinvesting the property in accordance with the rule, if
a conservator exercised this power and invested estate property in securities, the conservator
only could invest with a brokerage firm that was insured by the United States Securities
Protection Corporation. Additionally, the bill would prohibit a conservator from investing
estate property in cryptocurrency.
MCL 700.5423
BRIEF RATIONALE
A conservator is a fiduciary bound to the Michigan prudent investor rule requiring investments
and management of assets to be done with the care, skill, and caution that a prudent person
would exercise under similar circumstances. According to testimony before the Senate
Committee on Civil Rights, Judiciary, and Public Safety, while many individuals choose to
invest in cryptocurrency, there is too high of a risk for a conservator to invest a ward's assets
or property in cryptocurrency; reportedly, its market is volatile and lacks protections for loss
due to hardware malfunctions or insolvency of a third-party broker. It has been suggested to
prohibit a conservator from making these types of investments.
Legislative Analyst: Eleni Lionas
FISCAL IMPACT
The bill would have no fiscal impact on State or local government.
Date Completed: 6-24-24 Fiscal Analyst: Michael Siracuse
1
The Securities and Investment Protection Corporation (SIPC) is a Federally-established nonprofit
corporation that oversees all registered investment brokers, dealers, and firms. Primarily, SIPC oversees
the liquidation of member firms upon their closure and focuses on restoring customers' cash and
securities.
floor\sb656 Bill Analysis @ www.senate.michigan.gov/sfa
This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not
constitute an official statement of legislative intent.


Statutes affected:
Senate Introduced Bill: 700.5423
As Passed by the Senate: 700.5423