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Wednesday, May 3, 2017

My Mom swiped more than $13 million from my inheritance

Another trust fund has gone awry, with the trustee being sued for spending the funds in the trust on herself rather than holding them for the beneficiary.

In this case, the beneficiary is Elizabeth Marcus, whose father left a will dividing his $30 million estate between Elizabeth and her half-sister. The father died in 1993, leaving a will that specifically stated that his ex-wife, Geraldine Lettieri (Elizabeth's mother) should not receive any portion of his estate either directly or indirectly. They were divorced a few years before he died. The sister was the executor of the estate and a bank was appointed as trustee for Elizabeth's trust. Elizabeth was only 9 years old when her father died.

That probably would all have gone fine, had things been left alone. However, Lettieri gained control of Elizabeth's trust. The article I read in the New York Post (click here to read it) gave no explanation as to how she managed to do that, other than to say she fought in the courts for years to get control of it and eventually won.

Elizabeth's lawsuit against her  mother says that since gaining control of the the trust, Lettieri has bought herself cars, including a BMW 325i, and has bought the house next door to Gwenyth Paltrow for more than $5 million. Elizabeth says that her mother has no money of her own and is living this lavish lifestyle using trust funds.

The article is missing some key information in my view, including why the money is still in trust when Elizabeth is 32 years old, what amounts Elizabeth is supposed to  receive, and how Lettieri gained control of the trust in the first place.

Lettieri is denying the accusations. She says that the trust fund has been depleted not because she has spent money but because the real estate investments held by the trust lost money. It will be interesting to see how she explains away the mansion she bought.

This story is frustrating in the sense that Elizabeth's father seems to have gone to a fair amount of trouble to set things up in an estate plan that made sense and should have worked. He put assets in trust for a minor and appointed a bank as a neutral and competent trustee. It is truly unfortunate that somewhere along the way, his plans were overturned and his ex-wife was able to involve herself in a matter from which he wanted to exclude her.

The story also illustrates what happens when a trustee helps himself or herself to the funds being held for a minor when the minor becomes an adult. Of course the beneficiary is going to sue the trustee for stealing the funds. It may seem like stealing candy from a baby at the time, but those babies grow up and get upset when they find out what has happened.

The attached photo of Elizabeth and her mother accompanied the article in the New York Post and is credited to Patrick McMullen.

2 comments:

  1. Based on my knowledge, it is always wise to leave something to ie ex wives and children no matter what. I assume this is a birth mother and not a stepmom? The law and the courts don't always mesh but we would have to know the full story as to why the ex was left nothing.

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  2. Indeed, what a horrible outcome. The article is poorly written as you pointed out, lots of unanswered questions for details there.

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