Avoiding Estate Planning Scams

If we’ve said it once, we’ve said it a thousand times: every adult needs an estate plan. But about two-thirds of Ohio adults don’t have a will or any other estate planning documents. Maybe they were busy and kept putting it off. Maybe they didn’t know exactly what type of planning they needed. But most people do intend to get around to estate planning eventually—and that intention gives many estate planning scams their power.

Estate planning scams flourish in part because of what they promise: an easy path to peace of mind and protection for assets and families. But those promises often yield estate planning problems instead, and those problems may not be discovered until it’s too late to do anything about them.

Let’s take a look at some of the common scams for estate planning, and learn not just how to spot, and but how to avoid an estate planning scam.

Why Are Estate Planning Scams So Common?

There are many scams targeting seniors, not just estate planning scams. But estate planning scams are common because they are effective and profitable. They often target older people who have carefully saved all their lives and are more likely to have a significant nest egg than younger people. They take advantage of some seniors’ lack of familiarity with technology and prey on their fears about their families or their financial security. And they offer to solve a problem many people have (the need to make an estate plan) in an easy way, lifting a burden off the shoulders of the target.

While estate planning scams often target seniors, especially those with memory decline and no family members to look out for them, anyone can be vulnerable, including younger, tech-savvy individuals. That’s because everyone has something worth stealing—their personal information—and estate planning scams provide the perfect pretext for stealing it.

Some estate planning scams simply take targets’ money and provide a service they don’t need or that is overpriced. But in many scams, the real money comes from identity theft. You might know not to provide your Social Security number (SSN) and banking information to a contractor who solicits your business. But estate planning attorneys have a legitimate need to collect that information from you—so scammers have good cover for doing so as well. Then they use your information to perpetrate fraud.

Watch for These Estate Planning Scams

Here are some of the scams that have been making the rounds in recent years:

Living Trust Mills

Living trusts are great, and increasingly popular, estate planning tools: they avoid probate, and can protect assets for younger beneficiaries who lack the legal capacity or financial maturity to responsibly manage their inheritance. Trusts provide other benefits as well, but not everyone needs a living trust.

Living trust “mills” are businesses that promote living trusts for estate planning, often through dinner seminars, workshops, and mass marketing campaigns. They often use high-pressure sales tactics to persuade targets to purchase their generic, one-size-fits-all trust packages. These packages are not tailored for different people’s needs, they are often costly for what you receive, with hidden fees tacked on for upgrades or additional help—if follow-up help is available, which it frequently is not. There is usually no help funding a trust with your assets, which makes the trust worthless.

Excessive Fees

Some unethical service providers do provide a real service, but it may be unnecessary (like a complex trust when all you need is a simple will update), or offered at unnecessarily high rates. In order to get people to commit to services (and payment) before they have a chance to think about it, these providers may use scare tactics or suggest that the “low” rate they are offering is “one day only” and will soon increase. They don’t want you to have the chance to comparison shop; their game is to get you to sign up right away before your better judgment takes over.

Solicitations Targeting Seniors

Unfortunately, there are all kinds of scams targeting the vulnerable elderly, especially those with cognitive issues and no family members nearby to protect their interests. Financial exploitation of seniors may take many forms: tricking them into transferring assets or granting access to bank or investment accounts; persuading them to change beneficiary designations or estate planning documents to favor the scammer; or selling fraudulent investments with promises of unrealistic returns.

These are only a few of the many ways bad actors may take advantage of vulnerable adults. If you are worried about avoiding estate planning scams or protecting a loved one, keep reading.

Avoiding Estate Planning Scams

One of the best ways to avoid an estate planning scam is to only work with professionals that YOU seek out. Reputable estate planners advertise and give you a way to contact them, but almost never call you unsolicited or show up at your home.

In addition, commit to working only with an experienced (and if possible, state bar certified) estate planning attorney. While the occasional attorney engages in unethical conduct, the vast majority of attorneys are upstanding professionals who take ethics seriously. Many scammers imply that they are lawyers or work for a law firm without saying so outright. Ask directly: “Are you an estate planning attorney who is licensed to practice law in this state?” If they don’t say yes, don’t continue talking to them. If they do, ask for their license number and look them up.

Any estate planner who pressures you to hire them or buy their product immediately is waving a big red flag. Reputable estate planning attorneys know that committing to work with a lawyer is a big decision; no ethical attorney will have a problem with you taking your time to consider your options. Similarly, you should be cautious if someone tells you that the price for an estate plan will be going up soon; lawyers aren’t like retail stores that run sales or promotions.

Get Legal Protection Through an Experienced Estate Planning Attorney

The best way to avoid an estate planning scam is to be proactive. Do your research and reach out to reputable attorneys. The best defense to scammers trying to steal your information or sell you products you don’t need is to have an estate plan already in place with an attorney you trust. If you are concerned about an older person who is at risk for financial exploitation, an estate planning and elder law attorney can help you protect them as well. To learn more, contact Gudorf Law Group to schedule a consultation.