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Keeping Others’ Money In My Bank Account

Question:

I manage my family’s different savings accounts under separate accounts in my bank, under my main bank account. Is there any problem in doing this, as in the end I will be passing on the total account to them?

Answer:

If you yourself use the money in these accounts, even occasionally, for yourself, then in effect you are borrowing money from your family members, and lending that in turn to the bank. It would therefore be forbidden to pass on any interest earned in the bank to your family, because in effect the bank is paying you interest on your loan to them and you are paying interest to your family on the loan that they lent you.

If, however, you do not use this money at all but simply keep it there on their behalf, I have seen it written in the name of Rav Elyashiv that this would be permissible. Although the bank, recognizing only you and not your family, believes that it is paying interest to you, you actually know that the money deposited in the bank really belongs to your family, and when you collect interest from the bank you are actually merely collecting it on their behalf.

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