A Legal MinuteCautionary tales
Guarding Against Exploitative Executors
The short answer
The speaker has seen caregivers, CPAs and financial advisors, at her current and previous firms, make themselves executor, trustee or sole beneficiary, writing out family. Some took people to financial institutions to be named beneficiary. Those designations pass outside probate, so they're hard to address; institutions may confirm a payout but not say to whom.
From the full episode Common Probate Litigation Issues in Arizona (20:11).
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Transcript
We have seen that. We've had several cases, not only in this office, but in a previous firm I was at. I have seen caregivers, I have seen CPAs, I have seen financial advisors come in and make themselves the executor, make themselves the trustee, make themselves the sole beneficiary and write out family.
I have seen them not just modify estate plans, but take people to financial institutions and put themselves on as the beneficiary designation, which is really hard to address because those pass outside of probate.
And so, a lot of the times if somebody passes away and you say, for example, "Oh, I know there's a life insurance policy," let's just say at MassMutual. Family calls: "Hey, they've passed away, we know there's a policy." They will tell them, "Yep, we got notification of that. That policy had a beneficiary on it and it's been paid out." And when you say, "Well, to whom?" they say, "None of your business."
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