Estate Planning Lawsuit Reveals Importance of Having An Experienced Estate Lawyer in Your Corner!
Estate planning is a complicated process best managed with an experienced estate lawyer in your corner, as a recent lawsuit against two California companies who operated “trust mills” preying on senior citizens truly reveals.
Minnesota Attorney General Lori Swanson has recently sued two California companies, American Family Legal Plan and Heritage Marketing and Insurance Services, Inc., for their roles in a “trust mill” scheme believed to have affected more than 2,000 Minnesota senior citizens for a grand total of nearly $4 million.
So how did this estate planning scheme work? According to the Attorney General’s office, American Family Legal Plan marketed estate trust planning services to senior citizens by direct mail. Specifically, the company told senior citizens how it had a special expertise with estate planning and could advise them on how to avoid probate fees and estate taxes.
If the senior citizen expressed interest, Swanson reported that an agent posing as an estate planner would meet the person at home and then sell them a plan for $2,000 or more. Swanson added that all the while during the meeting, the “estate planner” would misrepresent the impact of probate fees and estate taxes. In other words, the estate planner would scare senior citizens into thinking that if they did not buy the trust, then their heirs would lose out on their estate.
According to Swanson, an attorney would then call the senior citizen and ask very general questions. Regardless of assets, marital status and the existing estate plan, the agents would then sell boilerplate “living trust” plans to each client. The plan was then “approved” by an attorney who never met with the client while the agent was paid a $600-800 commission.
From this point, Swanson described how the second half of the “trust mill” scheme kicked in. An insurance agent from Heritage, posing as a representative from the estate planning firm, delivered the trust document to the senior citizen. During this meeting at the senior citizen’s home, the agent then attempted to sell annuities to the senior citizen. In order to be compensated for the meeting, Swanson said that the insurance agent must sell annuities, with a $25,000 target goal in mind.
Taking that expected $25,000 annuity goal per sold trust into consideration, Swanson said that this “trust mill” scheme would add up to $50 million in annuity sales.
What Brought This Estate Planning Scheme to the Attention of the Minnesota Attorney General?
Senior citizens began to complain to the Minnesota Attorney General’s Office when their expectations were not met. For example, some senior citizens claimed that they became suspicious when receiving just one brief call from an attorney after paying $2,000 or more.
Other Minnesota senior citizens expressed a similar sentiment that they were scared into purchasing the estate planning service after the American Family Legal Plan detailed their exposure to estate taxes and probate fees. Furthermore, some Minnesota senior citizens complained that they did not receive their living trust for months.
After hearing this evidence and gathering more information, Swanson filed the lawsuit alleging consumer fraud, false advertising and deceptive trade practices. The suit seeks injunctive relief, civil penalties and restitution. Swanson’s office also indicated in the lawsuit that both companies were subject to similar litigation in at least two other states, North Carolina and Pennsylvania.
A Lesson Can Be Learned from This Consumer Fraud Case Involving Estate Law!
Ultimately, this estate trust planning scheme is just another example of the importance of having an experienced lawyer on your side. While these senior citizens were receiving one-size-fits-all documents that might not even protect their specific interests, they could have been receiving personal estate planning advice and document preparation from a qualified estate lawyer.
So whether your needs entail estate tax planning, career estate planning, will estate planning, financial estate planning or something else, be sure to get in touch with an estate lawyer in your area. Speaking with an experienced estate lawyer is the smart way to ensure that you get the estate planning protection and information that you truly need.
