If you have a bad Trustee who mismanaged assets, misappropriated them, or just stole them, you may be wondering how to find the money. That is a good question, and not always easy to answer. Of course, much depends on how the money was taken, or whether the money was ever part of the Trust to begin with. Every case is unique, and no one method will work for everyone. But here are some ideas on how assets can be tracked down:
Perform an Asset Search
There are professional asset search companies who can locate real property and financial accounts of a specific person. It does cost money to hire an asset search company, but it could be well worth the fee depending on what they find.
The fee can also vary depending on the number of assets you are trying to locate and the geographical area you must search. For example, a local search for real property in Los Angeles Counties will be much cheaper than a nationwide search for real estate.
Also, the more information you have on the person you are searching, the more likely you are to find good asset information. Real property is easier to locate since ownership is recorded with the County Recorder’s office. Financial information can be more difficult to find since asset search companies can only search for certain information on financial accounts.
In any event, it never hurts to conduct an asset search. Sometimes you find something helpful, sometimes you find nothing, but it doesn’t hurt to try.
Issue Subpoenas to Financial Institutions
If you have a pending lawsuit against a Trustee, then you have the right to issue subpoenas. Ideally, you want to issue subpoenas for all bank and brokerage accounts associated with your Trust. If you find evidence that monies were passed directly to the Trustee, or to the Trustee’s personal accounts, then you will want to subpoena the Trustee’s personal account as well.
Be aware that the right to privacy under the California Constitution may block your ability to subpoena a Trustee’s personal financial accounts unless you have evidence to prove the account information is directly relevant to your lawsuit. You must also use the least restrictive means to discover personal financial information. You don’t need to know all the details, the point is to find the money trail from the Trust first, and then you may have the evidence you need to find more evidence in personal accounts.
Credit cards are another great source of information. If the Trustee is using credit cards taken in the name of the Trust, or if the Trust is making credit card payments for the Trustee’s personal credit card from the Trust, then you will want to subpoena that credit card information.
Subpoenas are a powerful tool to help you find money because they allow you to obtain financial records directly from the source—the bank or brokerage company. Even if the money is gone, the financial records may tell you where the money went. If the funds were wired out of the bank, then there will be a record of that. If the funds were stolen by check or debit card, you can see that too. Financial records can be a wealth of information for tracing missing money.
Take Depositions
If you have a pending lawsuit, you have the right to take depositions of relevant witnesses. The Trustee, for example, can be questioned under oath and asked about the Trust assets. Think he will lie? Maybe. So try other witnesses, such as the Trust’s accountant, or financial planner.
Anyone who had any connection to the Trust or the Trust assets can be fair game when it comes to conducting depositions. And even if you do not get all the answers you are looking for from one witness, you may be able to piece together information from various witnesses who have knowledge of the Trust finances.
Hire a Forensic Accounting Expert
Once you have as much financial information as you can muster together, it may be time to call in an expert. A good forensic accountant can take incomplete financial information and piece together a money trail you can follow.
Many forensic accounting experts can make a lot out of a little information. Experts are a bit pricey, in fact the expert may be the most expensive part of this entire list. But a good expert is well worth the expense, especially if it helps you track down the Trust assets.
Some Things You’ll Never Know
There are no guarantees that you will find the money trail. You can look under every rock, but still not find the hidden loot. The one person who knows what happened to the money—the person who took it—is not talking. That leaves the burden on you to find the money trail.
This is especially true of assets that are not held in bank or brokerage accounts, or assets that do not have a title. For example, gold bars, coin collections, stamp collections, antiques, artwork, jewelry, all the stuff that can be carried away without a trace. These are the hardest assets to find because they usually leave no trace behind once they are gone.
The best approach is to be thorough and methodical. Put together a plan to search for and locate as much information as possible, and then hire an expert to help you sort through the information you find. But don’t expect miracles. Information and experts can only do so much. In some cases, there may be unanswered questions that remained unanswered.
