How to Protect Yourself from Estate Planning Scams

Estate planning should set your mind at ease. However, many Americans experience this feeling of relief only to find that they have become a victim of an estate planning scam. The statistics are scary: according to the U.S. Consumer Financial Protection Bureau, people aged 50+ who fall victim to financial scams lose more than $34,000 on average.

While there is no good outcome to an estate planning scam, victims who find out about the scam while they are still living at least have time to find a reputable estate planning attorney who can help amend their documents. The worst case scenario comes when a person who has fallen victim to a scammer passes away, and the grieving family is left to deal with the aftermath of a faulty estate plan.

At Margerie Law, I work hard to ensure individuals and families in the greater Milwaukee area are cared for and protected. Read on for my top tips for protecting yourself and your future from fraud.  

Estate planning scam victim profile

The most common victims of estate planning fraud are adults 50+. This may be true for a number of reasons, including:

  • Holding more financially significant assets than younger individuals
  • Being more likely to experience death or incapacitation, thereby making estate planning more urgent
  • Experiencing conditions like dementia that can impact decision-making at higher rates

However, people who are unfamiliar with estate planning can fall victim to financial fraud at any age.

How do scammers trick their victims? 

The “bad guys” behind estate planning scams tend to use anxiety-inducing tactics to scare their victims into making decisions they may otherwise know are not good. Scammers may tell their victim that, if they don’t work with the scammer, they will experience adverse outcomes like a “death tax,” or other significant financial loss. The scammer will make a victim feel that the pricey solutions offered by the scammer are the only ones that will help them avoid serious consequences, leaving the victim feeling that they have no choice.

The most common estate planning scam: trust mills.

There are an infinite number of ways estate planning scammers can trap their victims, and they come up with new strategies on a regular basis.

Trust mills are one of the most common estate planning scams. Trust mills are corporations that create faulty trusts that offer minimal protection for customers…but at a low, low price. The goal of trust mills are to capture sensitive information from the victim like account numbers and asset details. Trust mills also try to sell other deficient financial products to the victim, pocketing a large commission.

Protecting yourself from scams. 

There are several ways to protect yourself and your loved ones from estate planning scams. The most important aspect of all of these protection strategies is equipping yourself with knowledge and not making any decisions until all of your questions are answered.

Here’s how to protect yourself: 

    • Investigate all appeals. Scammers will do everything they can to seem legitimate. They will also try to solicit you directly, whether through the mail, over the phone, or even through door-to-door sales. Before signing on the dotted line, do a Google search of the company name and read through the results thoroughly. You may even try Googling “(company name)” and “scam” to verify if anyone else has had issues with said company.
    • Question, question, question. Get comfortable asking every question you have before signing any contracts or providing personal information to an estate planning company. One of the most important questions is “are you an attorney licensed to practice law in Wisconsin?” If the answer is no, even if they say they are consultants or associated with a law firm, do not work with this company. Only a licensed attorney can help you with everything you need to create a legitimate estate plan.
    • Be careful of add-on costs. Fraudulent companies make their money by selling faulty products to unknowing consumers and pocketing major commissions. Before you hand over your credit card information (or any other personal info) ensure the company you are working with is reputable and your representative is a licensed attorney.
    • Disclose fraudulent activity to the police. If you suspect a company you’ve encountered is running a scam or you have been a victim of fraud, report it to the police and to the fraud hotline, 1-800-876-7060.

Call an estate planning professional

Estate planning is one of the most complex and important processes you can undertake when thinking about your future, and you will rest easy knowing you have a professional attorney on your team. Here at Margerie Law, I help people in Milwaukee, Waukesha, Wauwatosa, and surrounding communities with expert estate planning services. Give me a call to start planning for your future today.