Can a Trustee Steal from a Trust?
The lure of easy money is sometimes just too powerful for some people to resist. Although it may seem incomprehensible, it is possible for a person to steal from a trust. In fact, it may be especially easy if that person is placed in a position of power – like being named the trustee of a trust.
A trustee is a person that has been hand-picked by the creator of the trust – or by the courts – to manage and distribute the assets of a trust after a person passes away. Trustees have access to bank accounts and physical property. They are responsible for assessing the value of possessions, coordinating sales and ensuring all property goes into the correct hands and managing and overseeing the assets of the trust. In short, trustees have a lot of power and responsibility.
Unfortunately, if your trustee is not 100% honest and ethical, there are ways for this person to steal from the trust:
- Neglect to itemize (hide) an asset in order to keep it for themself.
- Embellish their compensation – basically overcharging for their services.
- Purchase an asset from the trust for less than fair market value.
- Transfer assets from the trust into their own name.
- Skim money off the top from bank accounts.
- Keep the profits from sales of assets.
All of these are examples of how a trustee would be in breach of their fiduciary duties. If you suspect that a trustee is stealing from the trust, act quickly. The longer the theft is allowed to continue, the more the beneficiaries stand to lose. Document all of your suspicions with as much detail as possible and provide a list of evidence, if possible, so it is ready when you consult with a trust litigation attorney. The more evidence you provide to them, the more quickly they can file the documents with the court to hold the trustee accountable for their breaches of fiduciary duty.
Trust disputes are best handled by a trust litigation attorney. This type of professional will know the right steps to take to challenge record-keeping practices and hopefully stop the theft before serious harm can be done.
The Denver trust lawyers at The Brown Law Firm, LLC can help you investigate trustee wrongdoing and help you file pleadings with the courts – swiftly and accurately. To discuss your specific situation, please contact us at (303) 339-3750 or send us a message online.