Tips: Dealing With Elder Financial Abuse

After reading the article, “Lawyer reports twice as many calls about elder financial abuse” I asked my colleague Lisa Cukier to write a guest post, as she has years of experience dealing with this issue. This type of problem seems to surface when families are under stress.

Hope this is useful,

Best,
Nancy

Guest post by Lisa M. Cukier, Esq., Partner at Burns & Levinson LLP.  Ms. Cukier concentrates her practice in all aspects of probate litigation, fiduciary litigation, planning & litigation for blended families, same-sex couples, guardianship, conservatorship, mental health law, elder law and domestic relations.

Unfortunately it is not uncommon for friends, family and home health companions to exploit elders for their money and property. All too often, people step into an elder’s life in their final years, initially offering help, but later insidiously swaying elders’ thoughts about family members and creating fear about being placed in a nursing home or about the government taking the elders’ assets. These folks who may have had good intentions at first, later insinuate themselves into others’ estate plans and convince elders to gift them money or deed real estate over to themselves. Sometimes, elders feel dependent and weakened and are manipulated late in life to change their estate plans or to make gifts or sign deeds that leave out family members and long-term friends.

Reverse The Transaction!
Massachusetts law provides a mechanism for invalidating Wills and Deeds and asset transfers that are the product of undue influence or that occurred when a person lacked mental capacity. If the abuse is discovered while the elder is alive, a family member or a guardian can sue to rescind and revoke the Will or Deed. If the elder has already died, a family member or the executor or administrator of the decedent’s estate can sue to rescind and revoke. Massachusetts law also provides a mechanism for recovering assets that were wrongfully given away during a person’s life. Gifts and transfers can literally be undone and the Court can force bad actors to give back wrongfully transferred funds.

Plan for Protection Before The Damage is Done.
Don’t let this happen to you or your loved ones. A well-crafted Durable Power of Attorney can be used to prevent financial exploitation. This is a document by which one person nominates a trusted other person to manage and protect finances in the event of incapacity or mental weakness. The legal authority to manage other’s finances is a critical part of any estate plan, but can have tragic ramifications unless the authority is tempered with safeguards. First, in the selection of a fiduciary, nominate someone trustworthy and reliable. As an additional safeguard, consider naming a lawyer as well as a family member to serve as co-fiduciaries. To avoid unbridled use of the Durable Power of Attorney, have the lawyer draft the document to require the fiduciary to account to the lawyer semi-annually. To prevent the document from getting into the wrong hands too soon, have the lawyer escrow it at her office with the agreement that it will only be released to the fiduciary upon receipt of a doctor’s letter certifying that the elder lacks mental capacity to the extent that the document is now needed.