REVOCABLE LIVING TRUSTS,
LIFE INSURANCE & ANNUITIES
“Financial Exploitation” ?
Donald Akers, Jr.
Assistant District Attorney
16th Judicial District of Louisiana
WORLD ELDER ABUSE AWARENESS DAY 2012
June 11, Slidell, LA
June 13, Acadiana
* * Except for Louisiana Citizens ??

Will

Advanced directive and durable power of attorney
for healthcare

Financial power of attorney

Revocable living trust
www.suzeorman.com/igsbase/igstemplate.cfm?SRC=MD012&SRCN=aoedetails&GnavID=84&SnavI
D=30&TnavID=&AreasofExpertiseID=113

The trust is the owner of the property
transferred to the trust and is managed by a trustee
for the benefit of a beneficiary

Trusts can be created during life (living trust)
or in a will (testamentary trust)

Trusts can be “revocable” or “irrevocable”

Trusts are used for many legitimate & lawful
purposes
THE “FREE” LUNCH SEMINAR
Lure Leisurely Senior Citizens who have Time & Assets
such as Retirement Funds & Real Estate
Provide for Higher returns in low return conventional
markets (increased risks!)
“Free” evaluation of your portfolio, accounts & insurance
“Trust Mills” selling living trusts
THE LOCATION & THE SPONSOR “EFFECT”
Assisted Living Complexes
AARP and Senior Group Meetings
Nursing Homes
Retirement Communities
Churches
University Leisure Classes
Revocable Living Trusts: FACT or MYTH

Saves Inheritance & other Taxes

Avoids Probate

Costs & Attorney Fees are less than Wills /Probate

Prevents Freezing of Assets on Death

Protects All Assets

Cannot be Contested

Avoids Public Records Disclosure

Avoids Louisiana Forced Heirship Law…
Independent Insurance AGENT SENTENCED TO 90 DAYS IN JAIL FOR
FELONY THEFT conviction, sold complex “indexed” annuity to an 83 year
old woman alleged to have shown signs of dementia…
Case Prosecuted under California Elder Protection statute.
Agent alleged the woman “appeared fine and wasn’t confused at the time of
the transaction” and that he acted appropriately.
One agent said “There is nothing in insurance –licensing that prepares you
as a nonmedical person to diagnose dementia.”
The company returned principal with interest and no penalties
 Bank Manager notified adult protection agency when customer appeared
confused and influenced by her boyfriend to withdraw $175,000 to purchase
the annuity
AND IN THE ACADIANA AREA …
 An area financial services company received an alert and caution from their
corporate headquarters about the conviction reported in the Wall Street
Journal
 A financial consultant was contacted by his former customer an 83 year old
man whose 81 year old wife suffered from Alzheimer's disease. The
gentleman had unexpectedly closed his accounts of more than 20 years,
withdrawing about $500,000 dollars.
• 83 year old elderly man (with an 81 year old wife with Alzheimer’s
Disease) reports he started receiving calls from a non-local
insurance sales agent many months before he was visited at home
• He reports the agent claimed his company’s interest rates were
higher than his financial services company investment in short term
bonds with a 2.5%-3% annual return
• He reports that the agent had him close his financial services
account and sold him the following:
$ 100,000 Life Insurance (whole life) - 14 year surrender
$ 315,000 Index Linked S&P 500 Annuity - 16 year surrender
$ 160,000 Variable Universal Life Insurance
Total: $575,000
• He reports that he contacted his former financial advisor asking for
help because he didn’t understand what he bought and needed
$10,000 to pay taxes due to transactions and has no liquidity.
• He reports he was referred to elderly protective services and was
advised to file a complaint with Louisiana Department of Insurance.
• He reports he receives a call and visit from the insurance broker
who had received the complaint and was advised that if he dropped
the complaint, he could receive funds sufficient to cover taxes due
from cashing out bonds.
• He reports that he signs documents provided to him by the
insurance agent dropping the complaint (reports he learned the
document dropped all and not just one with cash available).
• He reports he paid his taxes, has no further liquidity and continues
to look for help
ISSUES
A “Crime” or A “Civil Matter”
Legal/Compliance Department says: “don’t participate”!
•
Indexed annuities are attractive to agents because of high
commissions, often 12% or more of the invested amount.
•
Historically low interest rates and a volatile stock market draw buyers,
especially fixed income investors.
FILE COMPLAINTS
Louisiana Department of Insurance
Investigates your complaints against companies, agents, or adjusters
http://www.ldi.state.la.us/ConsumerComplaintForm/Complaints/Welcome.
aspx
Web Site: http://www.ldi.state.la.us/
Phone: (800) 259-5300 -or- (225) 342-5900
Fax: (225) 342-3078
• Class Action Lawsuits by Victims in
many states are being brought for this
ripe area of Consumer Fraud
• State Elderly Protective Agencies are
focusing on these issues
• State Bar Associations are taking
action
• Take Time to Decide, Is it Too Good To
Be True?
• Consult with YOUR attorney,
accountant, banker or financial Advisor
BEFORE YOU BUY A PRODUCT
• If you need a Trust or other Estate
Planning, seek the advice of a
reputable, licensed professional who
deals directly with you
LOUISIANA OFFICE OF FINANCIAL INSTITUTIONS
http://www.ofi.state.la.us/
Investment Adviser Public Disclosure Check
professional background and conduct, current registrations ,
employment history, and disciplinary events
8660 United Plaza Blvd.
Second Floor
Baton Rouge, LA 70809-7024
Mailing Address:
Post Office Box 94095
Baton Rouge, LA 70804-9095
Main Phone: (225) 925-4660
Fax: (225) 925-4548
•
Donald D. Akers, Jr.
Assistant District Attorney, Elderly Protective Services
16th Judicial District of Louisiana
300 Iberia Street, Courthouse Suite 200
New Iberia, LA 70560-4583
Phone: 337-369-4420
Direct Ph: 337-365-3886
Direct Fax: 337-365-3886
•
Additional Ph: 337-367-8451
Alternate Fax: 337-365-7034
email: dakersjr@cox.net
•
Website:
www.16jda.com