Elder Financial Abuse – It Can Happen to Anyone

A drama played out in a French courtroom demonstrates that any elderly person can fall victim to financial abuse, even the second wealthiest woman in the world.

Lilliane Bettencourt, 92, is heiress to the L’Oreal cosmetics fortune, and Forbes has estimated her worth at $40 billion. According to a recent New York Times story, a current lawsuit in French court — dubbed the “Bettencourt Affair” — is a story of an elderly wealthy woman who vacillates between vulnerability and independence.

Unfortunately, Mrs. Bettencourt has spend almost the last decade of her life in and out of French courts. Her only child, Francoise Bettencourt-Meyers, sought to have her declared incompetent four years ago when it was discovered that Mrs. Bettencourt had gifted more than $1 billion to a society photographer, François-Marie Banier. Banier is the focus of the current case, where he is being prosecuted for financial exploitation along with several others, including Mrs. Bettencourt’s former wealth manager.

Elder financial abuse is also becoming more prevalent in the U.S. Fortunately, there are a number of advance planning tools that families can employ to help prevent financial exploitation, some of which are as follows:

• Advance Medical Directives – This legal document details your wishes as to your medical care in case of an illness, injury, or incapacity. The provisions designate a person to make health-care decisions on your behalf and spells out who can be given access to your medical records. This legal document  is designed to prevent a guardianship proceeding and to prevent your family from having to go to court in order to make medical decisions for you. As a result, Advance Medical Directives can save significant legal expenses, including the time and energy of a having to prepare and file a guardianship application where a judge will determine who will make medical decisions on your behalf.
• Financial Power of Attorney – This legal document designates the person who will be given the power to handle your financial affairs in case you are no longer able to do so yourself. A financial power of attorney will save your family the cost and delays of having to go to court for the purpose of obtaining access to your financial accounts to pay your bills if you are not able to do it yourself. This is an unnecessary court process and could easily cost your family $10,000 or more, if you do not have an up-to-date Financial Power of Attorney. In some instances, courts have declined to appoint children as financial guardian for their parents and appoint a professional conservator instead, which is often not what most individuals would have desired.
• Revocable Living Trusts – In the event that you become incapacitated, if your assets are titled in a Revocable Living Trust, your Successor Trustee can step right in and easily handle financial matters on your behalf and not have to get the court involved at all or collect assets using a Financial Power of Attorney. However, this is only true if specific assets which you own are properly titled in the name of your Trust. Oftentimes, the Trust is drafted and signed, but the client has not funded their Trust. Therefore, we work closely with our clients to ensure that their Trusts are properly funded in order to accomplish their estate planning goals.

Clients and their families can benefit greatly by seeking the counsel and advice of an estate planning attorney who takes the time to get to know them, along with the unique needs of their family.

At The Levin Law Firm, we take the time to learn about the personal and financial concerns of our clients, then work closely with clients, and their advisors, to develop an estate plan designed to achieve their wealth transfer goals.

Please feel free to forward this edition of Estate Planning Matters to your friends, family members, and colleague who may need to establish or update their personal estate plan.

To learn more about how The Levin Law Firm can create an estate plan designed to help your clients achieve their estate planning goals, please contact our office to schedule a Complimentary Consultation with attorney Phil Levin at (610) 977-2443.