What can I do if a trustee is self-dealing?

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What can I do if a trustee is self-dealing?

Asked on February 8, 2015 under Estate Planning, Colorado

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

You don't give any specifics as to your situation. However, assuming that you are a beneficiary of the Trust and the the trustee is in fact committing actionable self-dealing, you can sue them for breach of their fiduciary duty. In such a lawsuit, you could seek damages in the amount of any misappropriated funds or Trust assets, plus interest. In a situation in which damages are deemed to be an inadequate remedy (i.e. in the case of the Trustee taking and keeping a family heirloom), an equitable remedy would be applicable so that the trustee is forced to return the misappropriated asset. Additionally, the Trust itself may contain provisions for specific remedies in the event the trustee breaches their fiduciary duty.

In addition to the above civil remedies, depending upon the details of your case, you could possibly contact the district attorney's office to see if it will pursue criminal prosecution against the trustee. 

Finally, if found in breach, you can have the probate court remove the trustee and appoint a new one; actually the Trust may name a designated successor trustee when the current trustee is removed. 

 


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