But when that person no longer performs his or her fiduciary duties with honesty and integrity, they become a financial abuser. Similarly, a salesperson who seeks to exploit a vulnerable adult financially is guilty of this type of abuse.

What is financial abuse?

The U.S. Department of Health and Human Services defines financial abuse as a form of domestic violence. It is most common within families. Often, it accompanies physical abuse, especially between spouses. However, it is also possible to practice financial abuse against elderly friends and relatives, too, with or without a physical component.

Financial abuse and the elderly

When someone steals from an elder or another person in their care, it is financial exploitation. The National Adult Protective Services Agency defines this exploitation as the misuse or theft of the assets of a vulnerable adult, usually an elder or disabled person. Examples of financial exploitation include:

• Direct theft of valuables, medication or cash
• Record falsification or forgeries, including writing unauthorized checks
• Electronic extortion such as e-mail “phishing” or scam phone calls
• Real estate or mortgage hustles
• Insurance fraud

Understanding financial abuse and learning to recognize the signs is vital for anyone who cares for a vulnerable adult. Credit freezes, comprehensive estate plans and direct assistance from a financial advisor or lawyer could help mitigate the effects of exploitation or prevent it altogether.

Unfortunately, the bequests a deceased family member makes can sometimes come as an unpleasant surprise. If your inheritance is less than what you expected, you may feel left out or shortchanged. You may even suspect wrongdoing in the form of fraud or undue influence. 

It may be possible to contest a will that seems illegitimate in some way. However, before taking that step, you should carefully consider the costs of doing so. 

Chances of success 

The chances of successfully contesting a will are very small; it does not happen very often. Even when a will contest resolves, it is usually a settlement out of court. 

Relationships with others 

Contesting a will often means taking legal action against members of your own family, such as parents and siblings. This can cause a family rift that can prove difficult, if not impossible, to mend. The monetary gains may not make up for this significant, though intangible, loss. 

Costs of litigation 

If the amount of money you stand to gain by contesting the will exceeds what you would spend to litigate it, then it may be worth pursuing. Bear in mind, however, that the costs associated with litigation can add up to thousands of dollars. 

Maybe it is not a matter of money for you, but a question of righting a wrong against a loved one. If that is the case, then contesting the will may be the right decision regardless of the costs involved. However, there may also be other legal avenues by which you can pursue justice. For example, you may be able to pursue criminal charges if you suspect fraud or elder abuse. 

First of all, people should not let family members influence them to make decisions that go against their wishes. Unfortunately, some people are vulnerable in this regard, which is one reason why many estate-related disputes surface later on. However, people should take their loved ones’ feelings into consideration when making decisions regarding their estate plan. It is important to work toward minimizing disagreement in the family regarding an estate plan, especially since bitter disputes come up in many families (which wreaks havoc on relationships and even creates permanent hostilities and estrangement). 

If you are in the middle of creating an estate plan, you should take the opinions of your loved ones into consideration when making critical decisions regarding your estate. Communication is very beneficial and some people neglect to discuss these issues with their family members, which is also important after a loved one passes away. On our site, we cover a lot of other topics that have to do with undue influence. 

There are, however, a number of steps AARP recommends taking during estate planning to reduce the chances of inheritance conflict. Arguably the easiest way to do this is to simply leave all of your children the same amount, but ultimately, this is up to you. You may have valid reasons for wanting to exclude or limit the amount a particular child receives.

If you do not want to distribute your estate evenly among your children for whatever reason, it may benefit you to give your children at least a general overview of how you plan to make your distributions. You do not need to give them exact numbers, but some adult children have an inflated view of what they expect to inherit. Thus, setting expectations ahead of time may help reduce the chances of them winding up in litigation.

Similarly, if there are certain assets that you expect may cause controversy among your children, such as family heirlooms or vehicles, it may serve you well to decide what to do with these specific items early on. That way, you have an opportunity to notify your children of your decisions so they do not receive an unpleasant surprise somewhere down the line. Ultimately, the more your children understand about what to expect to receive from you, the less likely they are to fight amongst themselves after your passing. Find more on this topic on our webpage.

Fortunately, you can safeguard your wishes from these types of disputes by taking some steps now to prevent the appearance of undue influence.

Choosing the right agents

According to the National Center on Law & Elder Rights, your choice of agents to make your decisions when you cannot may go a long way toward ensuring that people honor your wishes.

The person in question should be:

• Trustworthy and committed to carrying out your wishes
• An active listener
• Emotionally and mentally strong
• Good at conflict resolution
• Organized

Even if you know who you want already, take the time to look for red flags such as personal financial issues, emotional instability, addiction or health problems. You also want to make sure the person you choose will be readily available when you need him or her.

Setting up safeguards

Once you have the right person, you still cannot guarantee that no one will challenge him or her. No matter how well you know and trust your agent, you also cannot guarantee that he or she will act in the way you want.

Consider choosing a third party to provide oversight, such as an accountant to go over the financials and make sure everything is aboveboard. A person with no ties to your estate who goes over the books occasionally may prevent loss due to mistakes as well as the potential for fraud. You may also want to require that any major transactions include the signature of a trusted third party.

For starters, it is important for parents to avoid feeling pressured by family members including children to distribute their estate in a particular manner. It is up to the person creating an estate plan to decide how to divide their assets among beneficiaries, regardless of whether everyone agrees with the decisions that they make. It is often very hard to decide how to divide assets among kids and there are a lot of factors to think about. For example, some parents decide to leave one child with more because they need the help more than their siblings do. However, this decision often upsets other children.

Other factors affect how parents decide to distribute their estate among children, such as their relationship with each child. For example, parents sometimes leave less to children who were not there for them, especially during tough times (such as major health issues), while others worry about a child’s ability to manage the assets properly. Sometimes, hard feelings lead to litigation. Visit our estate planning section to access more information connected to distributing your assets among loved ones.

Most wills also appoint an executor. The executor is responsible for managing the estate after death, including paying outstanding taxes or debts and distributing the remaining assets of the estate to beneficiaries.

Choosing a family member as executor

An executor does not have to be someone familiar with estate law. Many people name family and next of kin as executor. According to FindLaw, it is critical to select someone responsible, honest and organized to be the estate’s administrator. If an appointed administrator is unsure about how to proceed, he or she can seek help from an estate lawyer.

Selecting a family member to serve as executor may have unintended consequences. Close relatives who were not chosen may feel slighted or passed over by the decedent, which could lead to disagreements between beneficiaries and possibly a will contest.

Estates with no appointed executor

In some cases, the decedent may pass away before creating a will or appointing an executor. According to the Judicial Council of California, state probate law provides a list specifying the order of priority when assigning administrative duties to a relative. In most cases, the law assigns estate administration to the decedent’s spouse or domestic partner. If the spouse or partner dies at the same time or declines the appointment, one of the decedent’s children becomes the administrator.

If a person abuses the power of the role, it may have significant repercussions for the beneficiaries. Gaining a better understanding of the executor’s role is important for ensuring the person handles the position properly. 

Duties of the position 

An executor should handle the finances of a person’s estate, and this requires completing many tasks. Protecting estate assets, paying debts and taxes, filing for probate, liquidating assets and distributing property are all an executor’s responsibilities. 

Another important task is contacting all necessary parties; this includes reaching out to all beneficiaries and informing creditors of the person’s death. The executor may also need to use estate funds to pay for funeral and burial expenses. 

Compensation offered for this role 

Executors may receive reasonable compensation for their work, although they may choose to waive this fee. In California, for performing these duties, an executor may receive 4% on the first $100,000 and 3% on the second $100,000 of the estate’s value. 

Signs of abuse of the role 

If executors do not complete their tasks in a timely manner or delay the administration process for any reason, it may be cause for concern. In addition, the executor should prepare an inventory of property that includes market values and provide this list to all beneficiaries who request it. If the executor is reluctant to share these details and it is difficult to understand the current finances of the estate, it may be a sign of a misuse of power. 

Steps following misuse of power  

The court may need to step in if one suspects misuse of power, and a petition for removal may be the following action. In these cases, beneficiaries have the right to pursue a claim with the probate court. Seeking legal counsel may be useful in these situations to determine what the correct next course of action is for a given case. 

Forbes explains that an executor must never ignore beneficiaries. Heirs to an estate want the process of finalizing the estate to begin. They also want the executor to keep them apprised of the latest developments. Estate heirs are unlikely to tolerate an executor who stonewalls them, and might initiate court action to have an uncommunicative executor removed. 

Secondly, executors should be careful what they say to beneficiaries. Beneficiaries who have lost a loved one are likely to be grief stricken and anxious about the future. According to Think Advisor, some executors overpromise to ease their grief. They might say they can disperse the assets to them soon, but it may actually take a while to process the estate. Some estates have tax issues that need to be settled before beneficiaries can receive anything. 

Executors should also carefully document their activities, particularly if the estate is large and complicated. As part of their duties, some executors must invest estate money. However, a beneficiary might have problems with an investment decision. An executor should have paperwork ready to show the beneficiary why the investing decision was proper and authorized. 

Sometimes an executor needs to ask for help. Handling an estate alone can be a burdensome task, and some people lack the expertise to do so. This is why executors hire professionals like an accountant, a realtor, a financial advisor, or an attorney. An executor can draw on the help of professionals when communicating with beneficiaries to ensure the proper information is conveyed to them. 

The Record-Bee reports that California Probate Code has protections in place to prevent undue influence on the part of care custodians, and as of late June of 2019, that protection has become stronger. 

The loophole 

Before the amendment was signed into law, undue influence was a presumption if a dependent adult made a gift to a care custodian either while living or in an estate plan unless the care custodian could show through clear and convincing evidence that it was not undue influence. 

However, there was an exemption to that presumption before the amendment: A care custodian who is a spouse, domestic partner or cohabitant of the dependent adult was able to receive gifts and to be a death beneficiary of the dependent adult’s will, trust, life insurance policy or retirement accounts. Not only that, the care custodian spouse could still receive a presumptive intestate share when the dependent adult died even if the deceased had not provided a gift or changed the estate plan. 

The amendment 

Now, the law states that undue influence is presumed even if the care custodian marries the dependent adult, as long as the gift or change to the will or other estate plan document occurs within six months of the marriage. Also, if the dependent adult dies within six months of the marriage, the care custodian spouse does not qualify to receive the intestate share.