How to Avoid Estate Planning Fraud

Estate planning fraud has become an increasingly common problem in recent decades, especially for the elderly. Fortunately, fraud can be detected at an early stage through careful planning and taking precautions, so if you are concerned that an elderly relative is being taken advantage of, it is vital to speak with an experienced estate planning attorney who can ensure that his or her interests are protected.

Fraudulent Acts

Elderly individuals are especially vulnerable to being tricked into transferring assets, changing bank accounts, or altering wills or the terms of a trust based on false statements made by others. These types of fraudulent acts can also be achieved through the exercise of undue influence. Fortunately, when an individual relies on a false representation, the document can be invalidated by interested parties.

Undue Influence

In their waning years, many seniors come to rely on others completely for medical care and financial aid. This leaves them vulnerable to fraud, which may result in his or her wishes being ignored or overruled. In these cases, family members can argue that a relative was unduly influenced, and as a result, changed the provisions of his or her will even though the alterations did not conform to the testator’s true intentions.

To prove that an individual was unduly influenced, the party contesting the will does not have to establish that a beneficiary inspired fear in the testator. Instead, he or she can use evidence that kindness and affection were used to destroy the testator’s free agency.

Courts will often presume that undue influence was exercised when the testator and the beneficiary had a fiduciary relationship. To establish this presumption, the fraudulently excluded party must demonstrate that:

• A fiduciary relationship existed between the testator and the beneficiary;
• The person acting in a fiduciary capacity would receive a substantial benefit under the terms of the transaction; and
• The beneficiary had the opportunity to influence the grantor’s decision.

Fiduciary relationships do not always need to be formal in nature, but can arise out of a moral, personal, social, or domestic relationship, such as that between a patient and a caregiver.

Preventing Fraud

There are a few helpful tools that a testator can use to help him or her avoid becoming the victim of probate, including:

• Reviewing his or her financial plans twice a year;
• Openly communicating with his or her estate planning team, including bankers, accountants, attorneys, and family members;
• Designating a co-trustee;
• Requiring double signatures for amounts larger than a predetermined number; and
• Allowing his or her estate planning attorney to speak with family members and the other members of the estate planning team.

Contact a Experienced Estate Planning Attorney Today

Fraudulent alteration of a will or trust can have devastating consequences for testators and their loved ones, so if you have concerns that a member of your family has been the victim of fraud, please contact Carrier Law by calling 616-361-8400 and we will assist you in scheduling a consultation with an experienced estate planning attorney who can help explain your legal options.