Scams and frauds are happening across Arizona every day which garner the attention of state and federal law enforcement authorities. Although some fraud schemes are new, many are reruns of familiar criminal conduct including internet phishing scams through email, or false telephone calls and letters alleging to be from the IRS or the County Jury Commissioner. All in all, one should take a moment to review the types of crimes perpetrated on the elderly.
(1) Types of Fraud Schemes
Generally, the FBI divides fraud schemes into four main categories: (1) common fraud schemes, (2) investment related scams, (3) internet related scams, and (4) target scams against senior citizens. Of course, those crimes and scams that target senior citizens is where many estate planning clients may find themselves. (http://www.fbi.gov/scams-safety/fraud).
“Trust Milling”
One example of a scheme to defraud persons seeking to complete their estate planning is “Trust Milling”.
Trust Milling occurs when an insurance agent, who without a license to practice law, sells an estate plan including a Trust, with the objective of discovering a person’s assets intending to thereafter sell a financial product like an annuity. The word to the wise here is that if it “sounds to good to be true, then it likely is not true.” If you need assistance in preparing an estate plan, then use the services of a licensed attorney so you do not become the victim of poorly drafted estate planning documents, and purchase a financial product that may not be what you need.
Identity Theft
Of particular importance is taking steps to avoid becoming a victim of a fraud scheme by protecting your personally identifying information including a driver’s license number, social security number, and date of birth. Often times, identity theft arises from a trusted relationship where there is an opportunity to take advantage of vulnerable adult. Consider taking the following steps to protect yourself from identity theft:
- Don’t use the same password for all of your accounts.
- Use a question as a password, “What is the name of my father’s uncle?”
- Never give out your social security number.
- Never include your full address on a check.
- Obtain caller ID on a cell phone and don’t answer the call if you don’t know who it is.
- Never open an email if you don’t know who it is from.
- Check your credit report annually.
Practical Considerations in Estate Planning and Elder Law
So, what can an estate planning attorney do for their clients to keep them informed of fraud schemes and potential exploitation?
First, attorneys must consider explaining to clients the dangers of identity theft and other fraud schemes so that a client can make every attempt to safeguard their confidential information. By way of example, if a checking account is being re-titled into a revocable living trust, then encourage the client to limit the amount of personally identifying information included on a check.
Or, when real estate is transferred into a trust, remind the client that they may receive a letter from a third party soliciting them to pay a certain amount of money for a copy of the deed to their home, and not to pay for the copy of the deed since the law firm will return the original to the client. This type of scam is very common in Arizona.
Finally, estate planning attorneys should remember to maintain the client relationship under Arizona Ethics Rule 1.14 when a client has diminished capacity, and also to balance out the need to assist the client in obtaining the necessary services to protect the client from financial exploitation and identity theft.
For more information or if you have questions, please contact our Estate Planning Attorneys at (520) 624-8886 to make an appointment.
IMPORTANT: Neither this blog article nor any information on this website shall be construed as the offering or rendering of any legal advice, and does not establish an attorney-client relationship between the reader and Mesch Clark Rothschild, (“MCR”) or any attorney at MCR. You should consult with an attorney if you have a specific question regarding your legal issues.
