Under the Fiduciary Powers Act, a trustee may do almost anything except:

• A. Self-dealing
• B. Borrow on behalf of the trust
• C. Continue a business put in the trust
• D. All of the above

Answer: (D)

The key idea is that fiduciaries have broad authority to manage and deal with trust assets, but some actions are off-limits because they create conflicts or expose the trust to undue risk. Self-dealing is a classic conflict of interest for a trustee and is generally prohibited unless the trust instrument or a court specifically authorizes it with safeguards. Borrowing on behalf of the trust introduces debt and risk to the beneficiaries and typically requires explicit authorization, not unilateral action. Continuing a business that has been placed in the trust can be permissible only with proper authorization and careful oversight, because it involves ongoing business risk and potential conflicts with the trust’s interests. Without such authorization, these actions cannot be taken, so all of the above are not allowed under the Fiduciary Powers Act.