Homejoint ownershipJOINT ACCOUNTS ARE NOT AS SAFE AS A TRUST

Have you ever been in a situation where you and your sibling have gotten into an argument relating to your parent/parents finances? After you read the story below, I hope you have a better understanding on what can be done in tough situations like the one below.

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BRENT’S PHOTO WITH A PICTURE OF PRESIDENT LINCOLN

There was a father that decided he wanted to create a trust for himself. He then decided to go meet with a trust attorney that could help him out with doing this. The attorney drew up all of his documents. He discussed with the attorney who he wanted to be as his joint owners on his savings bonds. He chose to have his daughters as her joint owners on his savings bonds. He decided to leave some of his assets out of his trust. He has some accounts and savings bonds. He decided to make one of his daughters responsible for all his financial affairs. They did not have this in writing. The whole family was verbally informed of the decision he chose to make. Everyone agreed that no significant financial transactions should be made without his daughter’s involvement and approval.

Two of his savings bonds matured. His daughter thought they would automatically be renewed. He has one joint saving bond with one daughter. The other is joint between him and the other daughter. His one daughter later found out that her sister got their father to sign the savings bond over to her. The sister confronted their father about it. The father did not remember making the agreement about not making financial decisions without her approval. He just signed what the sister threw at him without really understanding what it was that he was signing. The father a little later vaguely remembered giving his one daughter some money. He thought it was for a smaller amount then what the savings bond was worth.

This is the reason they agreed to have his daughter responsible for all his financial affairs. This shows why his daughter is making all his financial decisions. At that time the dad was on some medication for pain. The dad always tried to give his daughters money. The sisters agreed to not accept any money from him so, he could keep it for future needs.

The only gift they wouldn’t refuse was a tradition that began with their mother of a $5,000 Christmas present. The one sister approached the other sister about taking the money from the savings bond. The sister claimed she might need the money. The one sister doesn’t really seem to understand her fathers finances.

The transfer of the bond to the one daughter probably constituted exploitation.  It certainly will constitute a Medicaid transfer of resource penalty if the father has to apply for Medicaid to pay for his nursing home care.  DHS will look back 5 years for any transfers.  There is also the possibility that DHS will believe the transfer was exploitation by the daughter and refer the transfer to Adult Protective Services for investigation.
Now, you probably have a million questions running through your mind on what can be done to prevent this from happening again. You may be thinking “Do I need to get guardianship over my parent/parents?” or “Should we go ahead and put all the assets into the trust?” The best way to go about this is to contact an attorney who is an experienced probate, estate, trust, elder law and Medicaid attorney, like Brent D. Coldiron.  Brent has over 39 years of experience.  He may be reached through his website http://coldironlaw.com or by telephone (405) 478-5655 or 737-2244. He knows how to protect families. He is an expert in qualifying an applicant for Medicaid under the rules and regulations of Oklahoma.

Oklahoma Statutes Title 21 Section 843.4 states that “exploitation of an elderly person (anyone over the age of 62) or disabled adult” means: 2.)”Obtaining or using, endeavoring to obtain or use, or conspiring with another to obtain or use an elderly person’s or disabled adult’s funds, assets, or property with the intent to temporarily or permanently deprive the elderly person or disabled adult of the use, benefit, or possession of the funds, assets, or property, or to benefit someone other than the elderly person or disabled adult, by a person who knows or reasonably should know that the elderly person or disabled adult lacks the capacity to consent.” Section B-1 “If the funds, assets, or property involved in the exploitation of the elderly person or disabled adult are valued at One Hundred Thousand Dollars ($100,000.00) or more, the violator commits a felony punishable by imprisonment in the custody of the Department of Corrections for a term not more than fifteen (15) years and by a fine in an amount not exceeding Ten Thousand Dollars ($10,000.00). Section B-2 “If the funds, assets, or property involved in the exploitation of the elderly person or disabled adult are valued at One Hundred Thousand Dollars ($100,000.00), the violator commits a felony punishable by imprisonment in the custody of the Department of Corrections for a term not more than ten (10) years and by a fine in an amount not exceeding Ten Thousand Dollars ($10,000.00).

What that statute is saying is if a person takes money from an elderly person who lacks the ability to knowingly and competently consent it can be an offense.  if it is serious enough it punishment can be a term in the Department of Corrections not more than fifteen years and by a fine in an amount not exceeding ten thousand dollars. If a report is made to Adult Protective Services it will investigate and the District Attorney will decide if criminal charges shall be filed. The degree of competency and consent given by the elderly person is usually considered to determine whether or not charges are filed.

The daughter who discovered what her sister had done, unless her sister timely restores the funds, is required to report suspected financial exploitation of the elderly to Adult Protective Services. If the funds are not voluntarily restored, the sister who discovered the exploitation may commit a crime if she fails to report it for investigation.

In the above example the money should have all be put into trust.  The daughter who was dependable and trustworthy should have been put over the money.  The mistake was making it easy for the other daughter to get possession of the funds.  Using a trust would have avoided probate, and protected the money.

There are elderly people who lose thousands of dollars. People try to get the elderly to give them money. The elderly people normally don’t realize it until someone steps it and puts a stop to it. Then, its hard to try and get that money back. For the most part that money will be gone and the elderly will be left without that money. If they need to go to a nursing home, a transfer of resources may create a Medicaid penalty.

The transfer of the money, even if it is financial exploitation, will initially constitute a Medicaid transfer penalty. Medicaid will generally be denied. It is possible, if exploitation is shown that the penalty can be waived.  Usually this is at a fair hearing.   His website is  http://coldironlaw.com or by telephone (405) 478-5655 or 737-2244. He knows how to protect applicants during the application process. He is an expert in qualifying an applicant for Medicaid under the rules and regulations of Oklahoma.  Brent is an expert in probate, trusts, including Medicaid Shield Trusts, guardianship and other elder law matters.


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