The Houghton family’s roots trace back to Corning, New York — where they started their world-famous glass business and built a family fortune, establishing a single-family office and then transforming it into a thriving multi-family office. Kara Pass, a well-respected wealth management veteran, took over the reins for the family as CEO of Market Street in 2019. Since her appointment, Pass has put the client experience at the core of the firm’s offerings. She discussed how technology drives the new client experience as well as her experience as a female CEO.
Can you share with us the story of the Houghton family, who founded Market Street?
The Houghtons are a remarkable, humble, kind and generous family. The family legacy really started in 1851 when Amory Houghton Sr. founded a small glass business, now known as Corning Inc. For over 170 years, Corning has enjoyed a heritage of innovation that has benefited both science and humanity through significant inventions such as glass for Edison’s lightbulb, TV picture tubes, heat-resistant windows for the first manned spacecraft, fiber-optic cables, LCDs and the Gorilla Glass we all have on our iPhones.
We have the honor today of working with the fifth-through-ninth generations of the family.
What has your journey into wealth management looked like?
Unexpected. I grew up in retail and commercial banking. Wealth management wasn’t on my radar until one day I got tapped on the shoulder about an opportunity to lead a wealth management division. Someone was kind enough to say they thought I’d be good at it. They saw something I wouldn’t have necessarily seen for myself. I wasn’t sure I would love it the way I had loved the other areas I had worked in. And yet, the very first time I had the opportunity to work with someone going through a difficult situation and see the peace of mind that the work could bring in such a situation, I was hooked and never looked back.
Ever since starting in wealth management, I have combined my passions for the client experience and technology to work with teams to create extraordinary experiences that we hope will have lasting and positive impacts on our clients’ lives.
The Houghton family made a bold move to turn their single-family office into a multi-family office in the name of succession. What was that thought process like?
This is one of the stories that I just love and makes me so proud to be a part of this organization. Over 30 years ago, the Houghtons’ family office was led by a lovely gentleman named Rowlie Stebbins, who still serves on our board as a director emeritus. They realized, looking out over the next 30 to 50 years, that the money would disperse, making the family office model less sustainable, and they began discussing the possibility of bringing on other families.
Their response was “Who would want to join our little family office?” They are so humble, but Rowlie knew the answer to that question; and sure enough, they brought on other families that wanted the same things the Houghtons had — the ability to sustain wealth throughout the generations, to raise responsible children and create lasting legacies.
What I find even more impressive is that the Houghtons didn’t just want these families to join, benefit from the family office and receive the same services they had. They wanted these families to have a seat at the table, so they created an ownership model where families have an ownership stake in relation to their assets under management, creating a true shared-family office which allows families the service and attention of a single-family office without the administrative burdens of starting their own offices.
The addition of other like-minded families has really helped us continually grow, evolve and get better together as a firm singularly focused on the client experience.
You are quite passionate about technology and the client experience. How have you implemented that at Market Street?
I love history and innovation, and Market Street, as an organization, is the epitome of these things, enjoying an over 100-plus-year legacy steeped in innovation. In its most basic sense, innovation saves us time, saves us — or makes us — money and makes things easier. Those are very appealing things to our clients.
At the core of an exceptional client experience is delivering services in a way that is delightful and leaves our clients feeling deeply cared for. I believe that exceptional client experiences combine a level of high-tech and high-touch. Technology is such a critical tool in helping us achieve clients’ and families’ goals, allowing us to bring those goals to light, to help people have an eyes-wide-open view of their financial pictures and to ensure not a single piece of their financial picture is missed.
Technology can empower the human touch, but not replace it. At the end of the day, I love self-service, but I want to know I can pick up a phone and find a human on the other end of the line that cares immensely about what is important to me. I want both; and I always want our clients to have both; and a team that is always forward-thinking, evolving and growing with the ever-evolving needs of the families we serve.
How do you plan to continue to modernize the tech experience going forward?
I have a friend who says we are all in the life-changing relationship business, and I love the truth in that. We all have the ability to see what we do through this lens — the ability to see how our work can serve other humans. Our “why” is the same; our “how” is what differentiates us. For me, our “how” will always be in how we deliver a high-tech and high-touch experience to positively impact our clients’ lives. To do that, we will always focus on hiring people that are passionate about this mission, that know how to deliver exceptional experiences, that have the talents and the expertise needed and that are always growing, adapting and intellectually curious.
I don’t want to say we are a tech company that happens to do wealth management, but there is some truth that technology is the foundation for which we build a compassionate, human-centered organization.
As a female CEO in the family office space, what is your advice for other women in the industry who are coming up?
At the age of 41, I was a senior vice president and overseeing a wealth management team. I was also pregnant with my second child, my daughter. More than one woman told me how meaningful it was to not just have a woman in a senior leadership role that had been predominantly run by men, but to have one that was pregnant. I remember being so struck by that and how just my presence, and being me, helped other women.
And then, I thought about all the women that have inspired me and continue to inspire me, both young and old. I have surrounded myself with outstanding men and women. The people around me help me grow, help me achieve and help me be the best version of myself, and I do my best to pay that forward.
So my advice — show up, be yourself and surround yourself with people and organizations that care deeply about you, your well-being and helping you use your unique talents to make a difference in the world; because, after all, we are all in the life-changing relationship business.
MORE INSIGHTS: The tip of the iceberg: Estate planning and stolen art
By MATTHEW ERSKINE
After having dozens of pieces of art seized from its collection in recent years amid scrutiny over looted art, New York’s Metropolitan Museum of Art is forming a team to scour its collections for items suspected of having been stolen in the past.
In the first five months of 2023, more artworks have been seized from both public museum collections and private clients and dealers. The sheer number of items listed on the various stolen-art registers — 700,000 at the Art Loss Register alone — is staggering. Even if a private collector purchased the artwork from a reputable dealer or inherited it decades ago, it is still subject to seizure and repatriation. 
The likelihood that collectors may not have good title to their artwork is so high that the status of these assets should be taken into consideration when creating an estate plan.
Besides the risk of losing the artwork by having it seized, there are also significant financial and tax implications for the collector’s estate. Having to pull artwork from an auction means that the estate has much less liquidity to meet potential estate tax and administrative costs as well as specific bequests.
In one case where a World War II veteran had stolen artwork from a church in Germany right after the war — discovered by his family after his death — the Internal Revenue Service included the fair market value of the looted artwork in the veteran’s estate for estate tax purposes, even though the work was seized and repatriated to the church from which it had been stolen.
Determining the exact extent of stolen or looted art in the United States is difficult due to the illicit nature of such activities and the lack of comprehensive data. The trade of stolen art is a global issue, and works stolen from various countries will find their way into the legitimate art market. This trade involves a network of underground dealers, clients and criminals.
Throughout history, looting has occurred during times of conflict, colonialism and war. This includes instances where cultural-heritage objects, including works of art, have been plundered from their countries of origin. The looted art can be smuggled and sold in various markets.
The result is that the collections of many museums and cultural institutions in the United States contain artwork that was purchased, acquired or donated without proper regard to provenance to ensure that the work was not acquired through illicit means. The art market is generally unregulated and opaque, though efforts have been made to regulate it to prevent the circulation of stolen artwork.
Protecting a client from the effects of owning stolen or looted artwork means either that the prior owner’s rights have been extinguished or that the estate plan has a contingency for such an eventuality.
Although no statute of limitations exists for prior owners to claim title to stolen or looted art, a client can get what amounts to good title to the artwork against the claims of prior owners through the doctrine of laches. This doctrine considers whether, on balance, the efforts of the client to safeguard his or her rights to the artwork, and the injury the client would incur if the work were now recovered, outweighs the efforts of the prior owner to recover the artwork if that owner hasn’t informed the art world of the loss, and the owner neglects to enforce his or her rights once the location of the artwork is uncovered.
The level of due diligence on the title to artwork is, for all but the wealthiest clients, unaffordable, since the research may cost more than the artwork itself. Due diligence means more than accepting the seller’s word on the provenance of the artwork. It requires researching the artwork on registers such as the Art Loss Registry or the FBI Art Theft Program. There are also specialty firms such as Winston Art Group that provide due diligence for artwork for a fee.
If the defense of laches fails, then it is worthwhile to consider other options. For example, many heirs of former owners who realize that the artwork cannot be divided equitably among multiple heirs are not averse to selling the artwork and dividing the proceeds with the client or their heirs. Alternatively, you can set up the gift in either the will or the trust so that the fiduciary can disclaim the artwork and have it go to a charity. That way, even if the artwork is repatriated, you are not increasing the taxes on the estate by the fair market value of the artwork.
So be aware that a collector may not have good title to all of his or her artwork and collectibles — and where there is one suspect item, there are likely to be more. It may be just the tip of the iceberg, and without due diligence and having a Plan B in place, your estate plan just may founder.
Matthew Erskine is managing partner of Erskine & Erskine in Worcester, Massachusetts.