Losing a loved one is never easy. While you try to find a way to cope with the emotional realities of the situation, you might also have very real financial concerns if you were mentioned in your loved one’s estate plan. After all, how those finances are managed is probably left to an executor or trustee who you may or may not know.
The importance of the fiduciary duty
Fortunately, these individuals are bound by the law, specifically the fiduciary duty. This means that they are required to put the interests of a beneficiary before their own. So, if you’re a named beneficiary of a trust, then the trustee has to utilize trust funds in a way that furthers your interests.
That might sound simple enough, but the truth of the matter is that fiduciary duties are breached all the time. When this happens, beneficiaries can be financially harmed in a serious way. That’s why it’s imperative that you stay on your toes and know when you need to investigate further.
Signs that the fiduciary duty may have been breached
There are a lot of red flags that should spur you to look closer at the actions of a trustee or executor. Here are just some of the signs that the fiduciary duty may have been breached in your case:
- Assets are missing without a plausible explanation: The fiduciary, whether that be a trustee or an estate executor, is required to keep detailed records so that you know the status of the estate and how estate assets are being used. Review those records often. If you find that assets are missing, then you need to start asking questions. If the fiduciary doesn’t give you very good answers, then there’s a significant chance that the fiduciary duty has been breached and you need to investigate further.
- Assets have been commingled: It needs to be very clear which assets remain in the estate in question. This can be difficult to do when the fiduciary mixes the estate’s assets with his or her own assets. When this happens, the fiduciary could actually be using the estate’s assets for his or her own personal gain.
- Showing favoritism: Fiduciaries are supposed to act with impartiality. Far too often, though, fiduciaries tend to favor one beneficiary over the other. This can cause significant financial harm to those other beneficiaries. So, it’s imperative that you know how other beneficiaries are being treated. Accounting records might help you here.
- Poor accounting: Fiduciaries are supposed to clearly account for all financial transactions pertaining to the estate. If, upon review of the estate’s financial records, you find that the records are incomplete, missing, or misleading, then the fiduciary duty may have been breached and you need to start asking pointed questions.
Protect your interests when dealing with a fiduciary
There’s a lot at stake when you’re dealing with a loved one’s estate plan. While you certainly hope that your loved one’s estate plan will play out according to their clearly stated wishes, you can’t count on that. That’s why it’s imperative that you’re proactive in protecting your interests. Don’t be afraid to regularly review the estate’s financial records, ask questions, and investigate. After all, that might be the only way to gather the evidence that you need to build a strong legal claim. If you’ve been wronged by a fiduciary, then hopefully you can take the action needed to achieve a just outcome.