ATTORNEY NEWSLETTER
Trustee Theft And Other Breaches Of Duty
Removal And Other Remedies
Elder And Dependent Adult Abuse Act Remedies
Trusts are important tools for protecting and managing assets for anyone, especially seniors and dependent adults. For dependent persons, there is a specific form of trust known as a Special Needs trust to protect the assets and pay for the special needs of disabled and dependent persons of any age. See Probate Code § 19513 et seq. Appointed trustees for any kind of trust, including Special Needs Trusts, may breach the fiduciary duty they owe by embezzling or commingling funds, moving trust funds around or even out of the trust entirely for their own benefit, borrowing against trust assets, failing to put the trust’s (and settlor/beneficiary’s) interest first, or losing or mismanaging trust property. Remedies for breach are provided under the Probate Code, and even greater remedies are available under the Elder and Dependent Adult Abuse Act, as discussed below. Evans Law Firm, Inc. represents beneficiaries who have suffered injury as a result of a trustee’s breach of fiduciary duty. If you or a loved one has been a victim of a breach of fiduciary duty by a trustee in California, contact us today at (415) 441-8669 and we can help. Our toll-free number is 1-888-50EVANS (888-503-8267).
Special Needs Trust Trustee Charged With Theft[1]
In a recent case, a trustee has been arrested and charged with stealing $330,000 from the special needs trust (SNT) of a man living in a long-term care facility. The case highlights the importance of having a professional trustee manage a special needs trust. According to a criminal complaint filed by the FBI, in December 2017 the defendant persuaded a disabled man’s mother, who was trustee of the special needs trust and who suffered from dementia, to appoint defendant as her agent under a power of attorney. The complaint notes that the power of attorney was not properly notarized because the mother failed to appear before the notary when the document was signed. Nevertheless, when the defendant obtained power of attorney, the special needs trust contained more than $1 million, according to police. Over the next 18 months, defendant allegedly used the special needs trust as his personal ATM, making 896 transactions totaling $330,079. “The vast majority” of the funds diverted from the SNT were not used for the trust’s beneficiary, according to the complaint. According to police, defendant allegedly made 650 purchases totaling more than $60,000 at grocery stores, restaurants, movie theaters, hotels, car washes, and gas stations using a debit card associated with the SNT. Among the alleged purchases were a sleeper sofa and loveseat from a furniture store that were delivered to defendant’s home, and a stay at a luxury hotel. The defendant is being charged with federal wire fraud because the SNT’s accounts were established at a bank that uses servers located outside the State. He is facing up to 20 years in federal prison.
Removal And Financial Elder Abuse Remedies
In addition to criminal penalties, civil damages are available against trustees who breach their fiduciary duty under California Probate Code § 16420 et seq. and even broader remedies under the California Elder Abuse and Dependent Adult Civil Protection Act (“Elder Abuse Act”), Welf. & Inst. Code § 15600 et seq. The abusive trustee, and anyone assisting him or her such as an attorney, may be liable for financial elder or dependent adult abuse as defined under the Elder Abuse Act. Cal. Welf. & Inst. Code 15610.30. Under that statute, the court awards mandatory attorneys’ fees and costs to the injured senior under certain circumstances. Cal. Welf. & inst. Code § 15657.5. The senior or dependent adult may also be entitled to extra damages in certain instances.
Contact Us
If you or a loved one has been a victim of a breach of fiduciary duty by a trustee in Alameda County or elsewhere in California or, contact Ingrid Evans s at (415) 441-8669, or by email at <a href=”mailto:info@evanslaw.com”>info@evanslaw.com</a>. Our toll-free number is 1-888-50EVANS (888-503-8267).
[1] Evans Law Firm, Inc. is not involved in the reported case.
