What Happens When a Trustee is Accused of Stealing?
What generally happens when a trustee is accused of stealing from a trust?
Florida attorney L. Reed Bloodworth is the Founder and CEO of Bloodworth Law, PLLC, which represents plaintiffs and defendants in trust litigation.
Florida Trust Code Specifies Duties
First, Florida law includes a trust code that outlines specific duties and actions that trustees are required to follow as fiduciaries.
A trustee is supposed to disclose all material facts about transactions and the management of a trust. This information is supplied in an annual accounting.
When done properly, an annual accounting can limit the time for interested persons to challenge the actions and transactions disclosed in the accounting to six months.
Trustee Accused of Stealing from a Trust
Second, if you are a trustee accused of stealing from a trust, or not properly handling fiduciary duties, talk with an experienced Florida trust litigation attorney about your situation. A Florida trust litigator can assist you with your legal disputes before they become legal disputes or lawsuits.
Allegations of Theft or Fraud
Third, if allegations of theft or fraud are being made against a trustee, an attorney will either challenge the trustee’s annual accounting or make a formal demand for an Annual Accounting if the trustee has not supplied one.
When necessary, forensic accountants may be hired to determine whether there were any misdeeds by the trustee.
Theft or Misappropriation in Property Transfers
Most of the time, claims of theft or misappropriation revolve around disagreements over property transfers, but there are many ways a trustee could potentially misappropriate funds from a trust. Here are some acts of theft by a trustee:
- Pocketing, hiding, or excluding known assets from the trust to keep them for themselves or away from beneficiaries.
- Investing trust assets in the trustee’s personal interests vs. the interests of the trust and the beneficiaries.
- Trustees pay themselves an exorbitant trustee fee.
- Purchasing an asset from the trust at a lower price than its value.
- Distributing funds indiscriminately or not in accordance with the trust.
- Taking out personal loans from the trust.
- Taking assets and selling them and keeping the profits.
- Attempting to hide, alter, or disguise transactions.
These illegal activities could result in charges of breach of fiduciary duty, civil theft, and fraud. Florida law allows for the recovery of attorney’s fees for failure to properly account for trust assets.
Trust Disputes: Who We Represent
In trust disputes, we represent trustees, grantors, beneficiaries, financial institutions, banks–any individual or entity involved in a Florida trust lawsuit.
What Happens When a Trustee is Accused of Stealing?
If you believe that a beneficiary has falsely accused you, a trustee, of stealing, or, if you’re a beneficiary and feel that a trustee has committed theft, fraud, or mismanaged trust assets, talk to Bloodworth Law and find out how to get help for you, or your family.
The office is located at 801 N. Magnolia Avenue, Suite 216, in downtown Orlando, Florida. The second office is located in Winter Haven, Florida.
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