Mismanagement of a Trust
Do you believe that a trust has been mismanaged by a trustee? Are you concerned about missing assets or falsified financial records? If so, it may be a good idea to ask a trust lawyer, like a trust lawyer in Chandler, AZ, to review your situation and provide you with legal advice on what you can do next.
What is a Trust?
A trust is a legal estate planning tool that designates a trustee who will oversee its management and administration. The objective of a trust is to distribute assets to named heirs after the settlor’s death (the settlor, also known as the testator, is the person who drafts the trust). Most people create a trust so their heirs can skip the probate process. Other benefits include the ability to reduce taxes and to keep the entire affair of the estate a private matter.
When considering a trustee, it is important that the testator takes time to choose the right person. Qualities to look for in a trustee include honesty, responsibility, and organizational skills. The role is not easy, which is why trust lawyers tend to offer a helping hand. Sometimes a trustee, who is often an heir, fails to adhere to their duties. Poor decisions could be made, or purposeful actions could be taken that are against the interest of all those concerned. Regardless of why a trust is being mismanaged, as soon as it appears that something isn’t right, steps should be taken to put a stop to what is going on. In this case, a trust litigation lawyer should be sought.
Common Examples of Trust Mismanagement
Trust management can occur in a number of ways; however, it will typically always involve a trustee who is not performing their responsibilities and duties. A good estate law firm will typically have handled trust litigation cases that have involved:
- A trustee who is supporting non-beneficiaries with funds from the trust
- A trustee who is transferring money out of the trust, and to people who are not beneficiaries
- Using the trust to pay off debts that are not related to the trust
- Faking accounting or financial records
- Borrowing money from the trust without notifying the beneficiaries
- Using the trust for something that is unknown to the beneficiaries
- Making decisions that do not support or benefit all beneficiaries
It is certainly possible that you will not, at this time, have proof of the trust mismanagement; however, if you suspect something isn’t right, you shouldn’t delay in consulting a trust litigation lawyer.
Proof of Trust Mismanagement
A trustee has many obligations, and one of these is to update and maintain financial records. This includes keeping detailed records of all transactions related to the trust. If a trust litigation lawyer believes mismanagement has occurred, he or she will look for:
- Any evidence that suggest falsified records or erroneous transactions
- Limited evidence that suggests something is wrong
Usually, a trust litigation lawyer will recommend that the trustee be temporarily removed from their position while the investigation takes place. If you choose this route, you will need to ask the court to intervene. The process can be very time consuming which means you should not delay in getting started. Call a trust litigation lawyer today.
Thanks to Citadel Law Firm for their insight into what can be done if there was mismanagement of a trust.