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Question about a trust. HELP!!!!

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trustquestion

Junior Member
State: Oklahoma

I need help! My dad passed away and left money in a testamentary trust to 3 grandchildren, all under the age of 4. Two of the children are mine, the other is my brothers. He appointed his 3rd wife who he had only been married to for 2 years as the trustee. He did this because my brother and I used to not get along, and he felt we would fight over how to run the trust. It's now 5 years later, and my dads wife has remarried. After he died, we received an account statement showing she had deposited the money into 3 separate bank accounts, but little information since. Each child is supposed to have approx $132,000 in there trust, and I assumed they would at least get some sort of interest payment on the principal. So far they have received nothing. I asked her what she was doing with the money, and she said she put it into CD's getting 3% interest. We asked her to seek the advice of a financial adviser to better manage this money, but she refused. We asked her to let us handle the investment with her having control on access to the money but she refused again. We then asked to see bank statements or any paperwork showing the current balance since there has been 5 years of interest. She refused again. In fact, shes now unwilling to show me or my brother anything relating to this money. I'm very concerned that this money may be being spent, but giving her the benefit of the doubt, I'm concerned about how the funds are being mismanaged. Our children won't receive any of this money until they are 25 according to her, and the will. (I think)

Here is how the will reads exactly, word for word, concerning the money and trust.

Provided, that in the event that any heirs are under 25 at the time of my death, I direct that property devised and bequeathed to such beneficiary shall be distributed to xx(3rd wife)xx, to be held in common trust for the use and benefit of each beneficiary under the age of 25 years. In the event of refusual...blah blah blah, some one even worse becomes the trustee, That's it, the whole will and trust part. There's parts that listed there names, the amount of money and where it comes from, but this little passage is everything concerning a trust. There is no paper work, no other legal documents, nothing. In fact, the lawyer just handed over a $398,000 check to her, and never followed up on what she did with it as far as I know.

So, 1st Question....from reading this, do you think it would be possible for my children to request funds, because the will says FOR THE USE AND BENEFIT of the beneficiary. That statement seems pretty vague to me, and I wonder if we requested money for our kids use, if she would have to turn a percentage over? I'd like to have a financial planner or adviser help manage this money, or at least help us get better returns than 3% interest. Can she say no to a request that vague? and if she did, how likely would a judge side with her? Is a trustee's word absolute law?

2nd question.....If we have to take the trustee to court, because we feel the money is being mismanaged, can she use the kids money in the trust to pay for legal fees fighting us?

3rd question.... Of course we would like to have input as parents as to how this money is being managed, but if necessary can the judge force her to seek financial help with the management, or can we request that her and the back up trustee be removed, and a court appointed trustee be put in place? My brother and I agree that we'd have no problem letting the trust pay a small fee to a professional company to properly invest and manage the kids money.

Thanks!
 
Last edited:


curb1

Senior Member
1) Feel fortunate that the money has been in a CD for the last four years. It could have been considerably worse.

2) Hire an attorney to force this issue. Do not wait, or try to do it yourself. This needs immediate attention (as of about 5 years ago).
 

TrustUser

Senior Member
there is no reason for her not to show you bank statements, except the very obvious.

i am sure everyone reading this thread is wondering why you waited 5 years.
 

trustquestion

Junior Member
Why this has taken 5 years?

We were trying to give her time to grieve, and at first had no reason to believe she would handle things so inappropriately. She never seemed like a con artist, or the sort who would take advantage of a situation like this, so we gave her time to sort things out.

At first, she did provide us with an account statement that was clearly set up as a trust. The money was deposited in the kids names, and invested in a CD that was earning almost 5% at the time. It was a 1 year CD, so we agreed to not hound her about it until it got closer to the time to change it. We started dropping hints that the money could be invested better, and my husband and I even offered to pay for the services of a financial adviser.

After that first year was up, and she didn't take us up on the offer, we had asked what was happening with the money. She assured us it was reinvested into another CD, and although it didn't have the best return rate, we felt like it was safe to leave her in charge of managing it. The alternate trustee is a much worse option, so we didn't want to take a chance that if this went to court, we'd end up with him. My uncle is an alcoholic free loader that would abuse these accounts and not care if he had to do jail time over it. My dad never saw him for what he was, and thought he would be loyal to his family. (Sometimes people believe what they want and need to believe, instead of the truth.)

So, even though the money wasn't being invested wisely, we didn't think anything odd was going on.

Then, 2 years ago I was talking with a friend who is a tax accountant. The trust was brought up, and she asked about the kids receiving interest payments from the CD. I had told her they never got any, and she found this odd. After doing some research, I found out that she was supposed to be giving the kids the interest, and they would need to fill out a tax form because between this trust and money my mom had left them, they would have to file taxes. Soooo, I called the wife, and started asking questions. She had a hard time answering, and got very defensive. I tried to reassure her that I wasn't questioning her ethic's, I just needed to know what was going on with these accounts. This is when she stopped giving us any information, and cut all contact with me and my brother.

Since then, I've tried to contact the bank the original accounts were set up at, but they can't legally tell me anything. I've called the probate attorney whose partner was the executor on the will. He has no information. I've called the wife several times, but got no response. I did everything I could think of to find out the status of these accounts, but came up short.

At this point, I still didn't believe she was doing anything illegal. I just thought she felt we were questioning her integrity, and had been offended. Then, last year we heard she had married again, and I decided to drive out to her house and try to talk about the accounts. I didn't call her, I just looked up the new address and drove out. What I found shocked me. She's living in a very expensive home that looks like it was professionally decorated, driving a brand new Lexus, and her new husband is also driving a new truck. She had a $2,000 handbag sitting on the table.....it just wasn't what I was used to seeing from her. She didn't have any money when she married my dad, and he only left her a small amount, around $10,000. So I went home, and had her and the husband investigated. She currently doesn't work, and has only worked off and on the past couple of years as a secretary. Her new husband is a mechanic. He owns his own shop, but that business is in debt. His former home was modest, and he filed for bankruptcy 4 years ago. He doesn't have the money to support their current lifestyle.

I really think something is wrong. I have to tread carefully, because the back up trustee is a worse choice. I don't want her to use my kids money fighting a court case. And on the odd chance that she has done nothing wrong, I don't want to accuse her of raiding the accounts if she hasn't. There are also family politics involved, as she's still very close friends with other family members.

So now**************.if anyone could please answer my questions, I would really appreciate it. Thanks
 

curb1

Senior Member
I would guess that the money is gone. There should be an annual accounting of the assets. Obviously that hasn't been done. You have waited too long to get serious about this. Waiting for someone "to grieve" is fine for a month or two, but there is a business side of death that has to be observed. A "loose cannon" trustee is difficult to reign in. You have to be very proactive.

I will say again, "Hire an attorney to force this issue. Do not wait, or try to do it yourself. This needs immediate attention (as of about 5 years ago)".
 

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