If you are the beneficiary of a trust from a loved one’s estate, you may rely on the assets in that trust for specific needs, such as educational costs, medical treatments or living expenses. Perhaps your loved one established the trust simply to provide you with financial security for years to come. As long as the designated trustee manages the assets and invests them well, you may feel confident about your future.
However, what can you do if you suspect that the trustee your loved one appointed is mismanaging the assets in the trust? Perhaps you even suspect the trustee of stealing from the trust. As overwhelming as it may seem, you cannot just sit back and watch your assets dwindle, so it is important that you take action to protect what is rightfully yours. This starts with confirming that the trustee is breaching his or her fiduciary duty.
As much as you would like to assume your trustee is honest and upright, it is not wise or in your best interests to simply wash your hands of the management of the trust and fail to keep an eye on what is happening. This means reviewing the accounts, understanding the trust’s expenses and recognizing when things don’t seem right. If a trustee is not living up to his or her duties, you may notice evidence of the following:
- Missing assets that the trustee may have taken or sold
- Rising credit card balances
- Inaccurate or insufficient reports and account documents
- Unauthorized transactions
- Late payment notices
- Unusually low account balances
Your suspicions may have alerted you when your trustee failed to return your calls, could not answer your questions or provided explanations that did not satisfy your concerns. It is possible that the trustee may believe he or she deserves more than the trust is paying for services, and an extensive evaluation of the account activities may even reveal questionable transactions from before the death of your loved one.
What should I do now?
The thought of trudging through months or years of trust accounts may be intimidating, and you would be wise to seek professional assistance from someone who knows what to look for and can preserve any evidence of wrongdoing. You may also wish to seek advice about the most effective ways to replace the trustee, recoup your losses and prevent similar breaches of trust from occurring in the future.