What is a Conservatorship?
A conservatorship is an arrangement where someone acts as another person’s financial overseer. Usually, that person is elderly, nearing the end of their life, and has become incapacitated in some way; “incapacitated” meaning they can’t make financial decisions anymore and are unable to take care of their ongoing financial obligations.
Guardianship is similar to a conservatorship but involves the care of that person’s (a “ward”) self, including their medical care. Conservatorship is strictly limited to the management of a financial estate.
Conservatorships usually go on until the conservatee (person under conservatorship) either recovers from their incapacitation or passes away. The court determines whether this person is indeed incapacitated and if so, they appoint a conservator to manage the conservatee’s bills, business expenses (if present), and any other financial obligations that the conservatee is no longer able to handle themselves. While conservators are often responsible, compassionate individuals, sometimes, they are con artists who choose these incapacitated individuals as targets for theft.
It’s not hard to see why this is so common, considering the power endowed upon conservators:
“(2) A conservator, acting reasonably and in an effort to accomplish the purpose of the appointment, and without further court authorization or confirmation, may:
(a) Collect, hold, and retain assets of the estate, including assets in which the conservator has a personal interest and real property in another state, until the conservator considers that disposition of an asset should be made; …”
C.R.S. § 15-14-425
When a conservator is appointed, that person gains total financial control over the estate. And while courts take every precaution to prevent the abuse of this power, it does happen—often. If you suspect that your or your family member’s conservator is abusing their court-appointed position, then it’s best to act quickly and decisively. Don’t let a crooked conservator get away with abusing their power—use the following guide to prevent the worst from happening.
The True Cost
A corrupt conservator is capable of utterly ruining an estate, as often happens. These underhanded individuals have been known to hire their “friends” to perform “tasks” for the conservatee’s estate that aren’t needed. Others are actually tied to certain caregiving providers and will hire them at exorbitant cost, whether the conservatee needs it or not. If the conservatee doesn’t have friends or family in close proximity (in other words, no one is watching what’s going on), the conservator can claim expenses that didn’t even occur. The conservator and his/her attorney are also paid fees, which come out of the conservatee’s estate. Thus, some conservators will and do inflate their time when record-keeping.
One of the most common types of conservatorship abuse is from family members. Because a family member appointed as a conservator may have close knowledge of the conservatee’s affairs already, they are often natural choices for playing the role of a conservator; unfortunately, these same things make it easier for them to steal from the conservatee.
A hypothetical example: an elderly man, Harry, is slipping into a coma and already named his daughter as conservator in his living will. But instead of dutifully managing his estate, she begins making ever-expanding purchases at her own beauty products business, using her father’s money. In this manner, she continues to siphon funds from Harry’s estate until his death. Harry had previously invested in her business and made a few orders before he became incapacitated—to help her business get started. If challenged, Rosa could use this as evidence that she was simply continuing to follow her father’s wishes—not that it matters. Since no other family member chooses to intervene on Harry’s behalf, Rosa gets away with it.
Conservatorship abuse can be monstrous, and the court won’t necessarily notice it by themselves. If the conservator follows the law as it’s written, they aren’t likely to do anything further.
Consider this—conservators are explicitly allowed to:
“(e) Invest assets of the estate as though the conservator were a trustee;
(f) Deposit money of the estate in a financial institution, including one operated by the conservator;
(g) Acquire or dispose of an asset of the estate, including real property in another state, for cash or on credit, at public or private sale, and manage, develop, improve, exchange, partition, change the character of, or abandon an asset of the estate; …”
C.R.S. § 15-14-425
Thus, this hypothetical daughter conservator is not technically violating the stipulations of conservatorship by making huge bulk purchases of beauty products using her father’s money. It doesn’t matter whether he would have wanted those products or not—as far as the court is concerned, Rosa acted within the permissions given to her. Given that she is also a close family member to the conservatee, Harry, and there is no legal history of abuse or animosity between them, there aren’t necessarily any glaring reasons that Rosa should be stopped. That’s why the intervention of those close to the conservatee is essential in situations like this one.
Signs of Abuse
Abuse is not always immediately obvious, but look for warning signs such as the appearance of new “friends” your vulnerable relative begins to talk about, or receive visits from.
Any talk of “gifts” made to these “friends” should raise a red flag immediately.
Another common tactic unscrupulous conservators use is to set up a new “charity” with the conservatee’s funds. Any such arrangement should warrant suspicion, since the very reason your loved one has a conservator is because they are no longer capable of making this type of decision anymore.
If a charity was not part of their will or estate plan before the conservatorship started, then it’s not likely responsible decision now that they are incapacitated.
Be wary if there are suddenly limitations on contact or personal access to your loved one. A crooked conservator won’t want family members to know what they are up to, and they often arrange for the conservatee’s isolation to prevent interference.
Watch the people involved with the conservatee’s case. New attorneys, caregivers, accountants, or “helpers” are often colluding with the abusing conservator, who pays them out of the vulnerable conservatee’s estate. Also beware of so-called “guardianship agencies.”
Finally, any unpaid expenses, lapses in coverage on regularly-paid services (such as cell phone bills or internet), or previously-unknown collections attempts should raise suspicion, especially if your vulnerable loved one was known for being financially responsible before being incapacitated. Still, don’t be afraid to question, investigate, and remain vigilant when dealing with a conservatorship.
How to Stop Conservatorship Abuse
If you suspect that the conservator appointed to your family member is abusing their financial duty, you must act as quickly as possible.
If your loved one has a conservatorship in place, then the conservator has a Conservator Bond. This is a built-in protection for the conservatee. It’s a promise to not abuse the conservatee’s money. You can make a claim against the bond for many reasons, but they need to be financial in nature (since the conservator is only in charge of financial matters). These include, but aren’t limited to misuse of money, theft, fraud, misrepresentation, going against the conservatee’s wishes, and other similar allegations. It’s important to note that a successful claim against the bond doesn’t obligate the court to replace the conservator or terminate the conservatorship.
According to the Colorado Judicial Branch, “Any person concerned about the Protected Person’s [conservatee’s] financial situation, or any person who would be negatively affected if the Protected Person’s finances are not managed correctly, can ask the court to replace the current conservator.”
That means you don’t need anyone’s permission before asking the court to remove or assign a different conservator. Nor do you need to make a claim against the bond—you can go right for replacing the conservator. You can do this yourself, but having an informed attorney on your side will substantially increase your chances of success. If your loved one is being abused by a bad conservator, you want to ensure you have the most effective strategy possible going forward—for their sake.
“Notice of the hearing on a petition for termination of conservatorship must be served on the protected person, if then living, and all other interested persons, as defined by law or by the court pursuant to § 15-10-201(27), C.R.S., if any. Such hearing may be held pursuant to Rule 24.” Probate Procedure Rule 26, CO
The court will hold a hearing, and will require evidence to prove that the conservatorship has been abused. This is presented by your attorney. Some evidence may not be available to you, but because a conservator is considered an agent of the court, they are required to keep records, and these records will be made available. The court may also subpoena any other records relevant to the case, such as bank statements.
Next, a new conservator will be appointed. This can be you, or someone else you trust. Your attorney will help you determine who this should be, if not you. Strong preference is usually given to immediate family members, such as the conservatee’s children, as long as they are over 21. This is where things might hit a roadblock; if multiple family members disagree over who should be named conservator, this may take a long time; longer than your incapacitated loved one may have left. It’s best to have a prudent and impartial attorney to advise you if that’s the case.
If the court finds that abuse did occur, the previous conservator may have to pay back whatever they stole from the conservatee’s estate, if a successful bond claim is also made. Other penalties may also be applied, depending on how severe the abuse was. Conservatorship abuse is essentially theft, and deceitful conservators (as well as their accomplices) are likely to be found guilty of this, if not perjury, since they are appointed officers of the court. With the assistance of a skilled lawyer, they can be made to pay for the injustice they’ve inflicted on your family.
We’re On Your Side
Conservatorships themselves aren’t a bad thing; it’s how people misuse them that continues to be a problem. Abuse can be totally destructive to a conservatee’s estate, and often is. If you have a beloved relative or friend under an abusive conservator, they need your help, and they need it fast.
Don’t go into a situation like this uninformed or unprepared. If your loved one is being abused by a crooked conservator, it’s not too late—Robinson and Henry’s compassionate attorneys are standing by to help. Call 303-688-0944 for a consultation today.