${site.data.firmName}${SEMFirmNameAlt}
Throughout Southern California
310-324-9403
Toll-Free
866-402-1805
View Our Practice Areas

Well-Known Bank Pays $8 Million in Damages after Being Found Guilty of Committing Trustee Fraud

Many banks and financial services companies offer a variety of services related to creating and managing trusts. When large trusts are established for minor children, it is necessary to use a professional trustee, but there are no guarantees that the professional trustee will carry out their fiduciary duties appropriately.

Tragically, seven year old Angela Militello became an orphan when her parents passed away in Midland, Texas. The Militello family was well off and had prepared for such a circumstance with a large trust that was managed by Wells Fargo bank. There were no problems for many years, or so it seemed. When Ms. Militello divorced in 2006, she contacted the trustee to take $200,000 from her trust so that she could buy a home for herself and her children. The money was given to her, and she was asked to sign paperwork approving the sale of a third of the entire trust's assets. In the next few weeks, the remainder of the trust assets were sold.

In and of itself, this is not an unusual story. A beneficiary of a trust needs cash for a particular purpose and to obtain the cash trust assets need to be sold.

The unusual aspect here is that Militello later sued Wells Fargo for fraud. She claimed that the bank conspired with a third-party to sell the trust assets at below market value. After a trial a Texas judge agreed with Militello and ordered Wells Fargo to pay $8 million in damages. The Dallas Morning News reported this story in "Judge: Wells Fargo to pay $8M for fraud tied to trust set up when Dallas woman was orphan."

The lesson here is that even when using the services of a professional trustee, such as a bank, trust beneficiaries should always pay attention and make sure the trustee is not acting for its own benefit.

No Comments

Leave a comment
Comment Information
Email Us For A Response

Find Out The Difference That Experience And Expertise Makes

Get the peace of mind that you deserve. First, attend a seminar. This will entitle you to a free initial consultation and a discounted estate planning fee. To learn more about our services or sign up for a seminar, contact us online or call us at 866-402-1805. We have offices in Torrance, Orange, Newport Beach, Pasadena and Woodland Hills.

Questions? Contact Us.

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Call Now For A Free Consultation: 866-402-1805
  • ${site.data.firmName}${SEMFirmNameAlt}
  • Main Office: Torrance

    Torrance Office
    990 West 190th Street
    Suite 500
    Torrance, CA 90502

    Toll Free: 866-402-1805
    Map & Directions

    Orange Office
    333 City Boulevard Street
    17th Floor
    Orange, CA 92660

    Toll Free: 866-402-1805
    Map & Directions

    Newport Beach Office
    5000 Birch Street
    Suite 8000
    Newport Beach, CA 92660

    Toll Free: 866-402-1805
    Map & Directions

    Pasadena Office
    790 East Colorado Boulevard
    9th Floor
    Pasadena, CA 91101

    Toll Free: 866-402-1805
    Map & Directions

    Woodland Hills Office
    5850 Canoga Avenue
    4th Floor
    Woodland Hills, CA 91367

    Toll Free: 866-402-1805
    Map & Directions

    Office map