An executor is the person appointed in a Will to carry out the instructions of that Will and administer the estate in accordance with the terms of the Will in the best interests of the beneficiaries.
Unfortunately, some executors take advantage of their position and prefer their own interests over those of the other beneficiaries. If an executor acts for their own gain and receives a benefit from this act, this is commonly known as executor fraud.
An executor has the responsibility to keep detailed records, to keep the estate funds separate to their personal funds, to avoid unreasonably delaying administration of the estate and to seek legal advice about complex matters.
A beneficiary is entitled to request information and regular updates about the estate administration. Beneficiaries often only discover executor fraud because they become suspicious of the executor’s secretive, uncooperative or deceitful behaviour.
Examples of executor fraud may include:
- Hiding or refusing to share estate finances with beneficiaries;
- instances where an executor has paid themselves unreasonable and unexplained advances from the estate;
- has used the deceased’s bank accounts as if it was theirs; or
- has sold assets under market value to themselves (or their family or friends).
If executor fraud is established by a beneficiary, an executor may be removed as executor and held personally liable for any losses that arose due to executor fraud.
If you seek advice about anything raised in this article, or want further information, please contact us on 02 4928 7300 or email willsandestates@mullanelindsay.com.au.
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