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MARIN COUNTY'S NEWS MONTHLY - FREE PRESS
(415)868-1600 - (415)868-0502(fax) - P.O. Box 31, Bolinas, CA, 94924

October, 2006

Ten Dirty Tricks of Guardians

The Coastal Post has periodically published stories on the horrors of abuse in guardianship cases in Marin County. Here are some Guardianship Tricks to watch for with the elderly and others who are conserved involuntarily.
Pinellas County Internal Auditor Robert W. Melton recently lectured at Eckerd College in St. Petersburg on: "Dirty Tricks of Guardianships - The Need for Change."

Using pure common sense, ask yourself a question: Why would this auditor prepare such a list if fraud did not exist? It DOES and HE WOULDN'T.

Here are just 10 of the "dirty tricks," as outlined by Pinellas County Internal Auditor Robert W. Melton:

1) Guardian creation of a trust: Remove all oversight by the court as a provision of the trust agreement; guardian becomes trustee; provide that the trustee can do whatever they want at their sole discretion.

2) Sell real estate at lowball price: Use "lowball" valuations as a benchmark; don't list property with Realtors; sell to a land trust, where nobody knows the beneficiary; watch property resold a few months later for a huge increase.

3) Maximize your (or your crony's) profit from investments: Hire money manager for "financial expertise" and let the manager select an investment broker; invest in volatile stocks and trade frequently to generate commissions; if you run up a large gain, don't selectively liquidate over time to pay the taxes but hold a "fire sale" to raise funds all in one day.

4) Undervalue beginning inventory: Have a used-furniture "friend" value a house full of antiques for $3,000; "forget" to put some of the more expensive items on the inventory; "forget" to include a $40,000 certificate of deposit.

5) Pay yourself first: Make payment of guardian and attorney fees the highest priority; disregard mortgage payments and let ward's home go into foreclosure; squirrel away money in the attorney's escrow account for possible future expenses.

6) Maintain guardianship at all costs: Keep family members uninformed; if family members try to become guardian, accuse them of stealing; use the ward's assets for legal fights to retain guardianship.

7) Improper financial reporting: Bury asset-management and brokerage fees as aggregate capital losses "due to market fluctuations"; don't classify disbursements separately; file incomplete or incorrect safe-deposit box inventories.

8) Forced incompetency: Visit assisted-living facilities and establish employee contacts; obtain voluntary limited financial guardianship; if there is money in the estate, do paperwork to force an evaluation of competency; get control over everything and the ward loses all rights.

9) Pay your attorney well: Let attorney bill full rate to shop for a computer and set it up for the ward; let attorneys bill their full rate, even if work is done by a paralegal or assistant.

10) Forget to file federal tax returns: Ensure there is a refund; wait till the ward dies; get check without oversight.

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