Hi all, you may have seen my previous thread about my grandfather whom I had to call APS for to get cancer treatment for a nasty tumor on his leg. Long story short, he is doing well, but as I recently became his DPOA, I've started looking into his finances and what I've found is extremely concerning.
My grandpa retired to the US in 2004 with between $200,000-$400,000. This could be worth a couple million today if it were invested. At this time, he put my uncle, let's call him Jr., on his bank account. Jr. lived in one of grandpa's houses and had access to his SSN, but never had a job. Jr. was in charge of grandpa's finances without a POA or any right to do so. Grandpa opened a line of credit on the house Jr. was living in to do some house flipping on the side. Jr. withdrew all of grandpa's retirement in 2008 during the crash at the lowest possible point in its value. My grandpa became eligible for social security around this time and Jr. never pursued it.
By 2013, that money had run out, and Jr. set up a reverse mortgage on grandpa's home. Jr. impersonated grandpa to the FHA counselor, signed for both grandpa & grandma on the counseling form, and brought the grandparents to the bank to sign the mortgage paperwork. The loan resulted in a $140,000 lump sum being paid out to the bank account Jr. had access to. It should be noted that Jr. was having all bank statements and financial notices sent to him, not the grandparents. Jr. proceeded to give the grandparents a pittance of $200/month, and gave grandpa cash for vodka, which resulted in them baking bread in their house to save money and grandpa gained a severe drinking problem, about 3 1.75L bottles of vodka a week. Jr. paid the utilities and TV bills, but allowed the property & flood insurance to lapse into force-placed coverage at twice the market rate, costing them $12,100/yr.
Once the lump sum ran out, Jr. started withdrawing $2500 every few months to keep this going, hiding the true state of the damage from everyone, especially us. He then took each of grandpa's credit cards and maxed them out for a total of $30,000 in collections, then spent the line of credit on the home he was living in, causing it to go into foreclosure for $98,000. When we started taking care of grandpa in 2021, we discovered the reverse mortgage and immediately cut Jr. off from grandpa's finances, but the damage was already done.
With my DPOA, I've discovered Jr. changed the address on grandpa's bank account to an apartment he was staying in that grandpa never knew about, spent every red cent he could until grandpa's bank account was charged off, and now my grandpa is penniless in hospice with cancer. Even my grandma's gold jewelry is missing. We don't know what Jr. was spending all this money on, drugs, hookers, we have no clue, but it's all gone. My grandpa slaved away for 21 years on offshore oil rigs, retired rich, and is now completely destitute.
I have started an investigation through APS for elder financial exploitation, however, the statute of limitations in Florida for EFE is 5 years with some exceptions. I am gathering all the statements that I possibly can from all sources. APS says they will refer it to the state attorney's office, and my plan is to negotiate with the reverse mortgage company to save the house once we have a clear cut case underway. What really bothers me is grandpa never receiving social security; whether that's negligence or Jr. is actually taking grandpa's social security check remains to be seen. 16 years of $500/month is more than $100,000.
I know this is mostly a lawyer / court problem, but have you guys had any success in similar situations? Am I doing the right thing? What kind of legal remedies are possible in this situation, and what are my odds of successfully negotiating with the reverse mortgage company?
Thank you all for your time.
So you recently became his DPoA? So, he has enough legal capacity to still be able to make decisions for himself? Ok, but being an alcoholic may not be an excuse for him making terrible choices. "Ignorance" is not a legal defense.
"Jr. was in charge of grandpa's finances without a POA or any right to do so." Well, your Grandpa gave him permission. If Jr was joint on his account, your Grandpa would have had to go into the bank in person in order to make this happen.
"...brought the grandparents to the bank to sign the mortgage paperwork."
Not sure how you have a case when they went into the bank in person and voluntarily signed the forms for the reverse mortgage.
Anything that happened financially prior to you getting DPoA (and also in the absence of a diagnosis of legal incapacity for your Grandfather) may be very difficult to use as proof of abuse. It will be your word against Jr's (if Grandpa doesn't remember or speak up for himself).
Why would the RM accept any negotiation when your Grandparents went in there voluntarily and signed the paperwork?
Grandpa didn't receive SS because he didn't apply for it. Is Grandpa now on Medicare or Medicaid at least? Was there a language barrier involved in all of this? Is this part of the reason why Grandpa relied on Jr so much?
A slimy lawyer will take your case on a retainer even if they know it's not winnable. Even if you did win, there's no money to recover from Jr. So, what's the point of all of this? To prosecute Jr as punishment? Will he ever go to jail for any of it?
You'll be paying the unending legal bills personally if Grandpa doesn't have the money to cover it. If Jr decides it's easier to disappear, then what?
If you cannot ever recover any of the money, what is the point of all of the time and energy and stress you will put into this? To keep the house? What is the current value of the house? If the house title is currently in your Grandpa's name, and IF he passes away without a Will, then would there be other inheritors after it goes through probate? For as much money as you may need to pay in legal fees, that money could go to buy a different house for yourself.
There are so many moving parts to this case, I'm really interested in whether anyone else will post a similar experience.
Have you tried posting this on Bogleheads.org? It's a financial advice public forum similar to this one, but about money and investing, etc.
I don't know if the statute of limitations applies as from date of fraud or from date of DISCOVERY of the fraud for your state?
The other problem is what does the perpetrator have in terms of anything to "recover". Is he a millionaire now who can return any of this? Unlikely.
The other problem is that your grandfather was at some point here of sound mind in all likelihood. He either GAVE permission or it cannot now be proven that he DID NOT give permission. It could fall, and the claim will be that it DOES fall into the realm of "poor decision making".
The other problem is that this was not one-and-done. This was fraud on many levels over years. That makes it too messy for a court of law.
The other problem is that if there is judgement in this you will at best come out with about 150,000. And collecting? Yeah. Right.
You have an attorney. That is great. But if you are PAYING for this? I am afraid that is money flushed in my humble opinion (I am not an attorney but have more knowledge of the law than I wish I did have, ha ha ha).
So in my opinion, an attorney taking this on contingency? Great.
Otherwise, this is all a lost cause. Granddad was not at the time bright enough to control his money. Whether from dementia or carelessness, who can guess.
I sure wish it were otherwise and I sure wish you luck.
What a mess, huh?
Now, that being said - if I were in your shoes, I would reach out to the attorney general about this case, and your claim that your grandpa never received FHA counseling. I don't know much at all about RM's, but if you claim it is a legal necessity to go through the counseling, then I imagine some sort of paperwork has to be signed by the person being "counseled". Maybe the attorney general's office can put some pressure on this company to, at the very least, renegotiate the terms of the loan to be more favorable to your grandparents. You might find out that the attorney general's office already has a list of complaints against this particular company, especially if your uncle was able to deceive them into believing he (your uncle) was his dad (your grandfather). Usually, you are required to provide photo ID to a financial institution before starting any sort of a business transaction with them, be it borrowing money or opening a savings account. If it happened as you say, I would go that route before I tried to sue Uncle for recompence, especially if Uncle doesn't have 2 nickels to rub together.
"The Adult Protective Services Act provides for the detection and correction of abuse, neglect, and exploitation."
As to LadyBird deeds and such-- you say he is Medicaid ineligible and Medicare eligible (because Hospice is a Medicare program; if he cannot get Medicaid he can't I assume get Medicare which means no paid for Hospice?????) Real concerns here you need to research thoroughly or ask your attorney about.
You will need to check with everything with an attorney.
Also know that hospice provides, today, almost NOTHING but medications, rented hospital bed and an aid for bath twice a week. That's the sad truth. Check them out; give them a call.
As to the home, that should go to his care. That is the idea, you save and invest FOR YOUR OLD AGE; his home is a part of that, or certainly should have been. If you can afford to BUY this home from him, now is the time. But to expect it saved for anyone when it is HIS and he needs it for HIS care? That wouldn't be right in any way.
A very complex situation this one, and the deeper one wades into the waters the deeper they get. I would stick with an attorney with your questions. I doubt we can fully "get" what all the details are here in this case.
A reverse mortgage is a simple loan. It can be paid any time. Altho it has huge interest in most cases. That's why it's usually demand payment at the time the person leave the home either through death or placement.
As for buying the home, yes that's my ultimate plan, but it may take a couple years of hard saving to bring it to fruition. If we can win a judgement in court where the mortgage can be negotiated down a bit, it would ensure we can keep the house. In my opinion, this is an opportunity for lawmakers to do something more to protect seniors from financial exploitation and predatory reverse mortgages. Maybe the state attorney's office will agree.