Your loved one may have taken the useful steps of creating an estate plan. After his or her passing, you received information regarding a trust to which your family member named you a beneficiary. At the time you felt pleased that your loved one thought of you when bequeathing the assets.
Initially, you may not have had too much information regarding how trusts work. However, you came to understand the role of the trustee, and you knew that he or she had a duty to ensure that the terms of the trust were carried out properly. More recently, you have grown concerned over whether the trustee has upheld the fiduciary duty associated with the role.
Trustee fraud
If a trustee breaches his or her fiduciary duty, you have a serious situation on your hands. Your loved one likely appointed the trustee due to feeling a sense of trust toward that person, but now, you may have concerns that the person has committed trustee fraud. Unfortunately, this type of fraud can take place, and even someone who may have seemed right for the role could make the wrong decisions when administering the trust.
Evidence of wrongdoing
If you believe that the trustee has violated his or her fiduciary duty, you may need to take legal action. Of course, you will need evidence to support your claims. The trustee should have kept records relating to transactions made on behalf of the trust. This information could prove useful to you. You may need to request the following information from your trustee:
- Records showing costs associated with administering the trust
- Documents other than federal tax returns showing income earned by the trust and distributions made
- Information showing that trust assets and the trustee’s personal assets have been kept separate
If the trustee has committed some type of fraud, he or she may not feel willing to immediately share these documents with you or possibly state that the records do not exist. If the trustee makes this argument in court, the outcome will likely not be in his or her favor.
Making a case
Moving forward with trust litigation may seem intimidating, but if the trustee has not kept up with his or her responsibilities, it may prove important for you to take legal action. Gaining information on your options and obtaining an assessment of your case could help you determine your best course of action.