The term “undue influence” refers to influence strong enough to abolish the free will of a person. Sadly, the undue influence over older and disabled persons is a growing problem in California and throughout the greater U.S., one that results in millions of dollars in losses to the estates of those affected. If one can prove undue influence is the reason for the transfer of assets, the amendment of an estate planning document or the extension of gifts, a judge may declare a will or trust invalid and withdraw the gifts or conveyance. For this reason, it is essential that you recognize the marks of undue influence so you can protect your loved one and your family before the influence results in substantial loss.
The Elder Protection Center details 12 common signs of undue influence. The first two signs involve gifts. If a loved one bequeaths a gift to a person who is not a natural object of his or her affection, or if he or she gifts a gift so large as to threaten his or her financial security, you may want to be wary of undue influence. The same goes for loans — if your loved one extends a loan to anyone, especially if he or she does not document the loan or if the loan contains unreasonable terms, give the loan more attention.
If you notice that your loved one names a non-family member as a beneficiary or fiduciary, or if he or she adds a non-family member to a joint banking account, explore his or her reasons for doing so more in-depth. If a fiduciary acts in a way that reflects poor judgment or conflict of interest, take that as a red flag.
You should also look for evidence of checks prepared by others but signed by your loved one. Pay extra attention if you notice that one child or another person is particularly dependent upon the elderly individual.
Bequest plans that favor one child, particularly a child who lives with the elderly individual, are a major indicator of undue influence. So too are excessive fees charged by financial advisors, trustees, attorneys or other professionals. Finally, if your loved one’s understanding of his or her estate and its true value are inconsistent, you may want to explore the possibility of undue influence more seriously.