Florida Estate Planning Lawyer Blog
A number of Texarkana residents have filed suit against sellers of living trust documents in a class action accusing the salesmen of exploiting senior citizens. This is similar to what I reported happening in California in December.
A Plaintiff says he purchased a living trust after attending a lunch presentation at a restaurant. He states the document was misrepresented and that if he dies with only these estate-planning documents, his estate will still need to be probated because the living trust failed to factor in his real property in Arkansas.
The living trust sellers are facing allegations of “masquerading as qualified financial advisers, estate planners, lawyers, and paralegals” to “exploit and prey” upon senior citizens with the creation and selling of “unnecessary and often useless” living trusts.
Defendants are accused of fraud, unauthorized practice of law, negligence, breach of fiduciary duty and conspiracy. The suit alleges that the defendants created and sold the living trusts as part of a scheme to gain access to senior citizens’ financial information in order to sell annuities and other financial products.
According to the original complaint, the scheme begins with advertisements that persuade senior citizens to attend a free lunch or dinner. At these meetings, the “unlicensed” living trust defendants conduct presentations and distribute materials that misrepresent the impact of probate fees and estate taxes in order to create fear that the senior citizens need to buy a trust to prevent heirs from losing their estate.
These presentations include references to celebrities such as Elvis and describe the large amounts these celebrities have paid in estate taxes. The plaintiffs state these presentations do not include information about the federal estate tax exemption, the sliding scale of the exemption amount, or the possibility of the elimination of future estate taxes.
Further, the presentation does not tell senior citizens with estates larger than the exemption amount that the purchase of these living trusts will not automatically eliminate all estate taxes. The forms and decisions made by the defendants fail to take into account the entire senior’s assets and ultimately and fail to serve the legal purpose as presented, argue the plaintiffs.
The plaintiffs claims the presentations convince the senior citizens to use their IRA accounts or other tax-exempt growth products to purchase variable annuities. However, according to the plaintiffs’ accusations, the presentations and documents do not demonstrate the redundancy with regard to a variable annuity’s tax deferral benefit when purchased in a qualified plan and also do not inform the consumer of the associated fees, surrender charges and commissions associated with these variable annuity products.
These types of programs are everywhere. It is important to use a lawyer who will look at your individual assets and who is not trying to sell you other financial products. To review your estate planning needs contact a Florida Estate Planning Lawyer.