Twin Cities readers may be interested to learn about an unusual case that raises ethical questions about profiting from another person’s misfortune and has many wondering whether a practice touted as offering a benefit to terminally ill patients may in fact be a case of financial exploitation of vulnerable adults. Federal prosecutors have charged an estate planning attorney with counts including conspiracy and mail and wire fraud stemming from his use of financial instruments that would generate profit upon the death of the owner.
The attorney allegedly placed ads in a religiously affiliated newspaper offering cash payments to people diagnosed with terminal health conditions. He presented the offer as an opportunity to receive cash assistance with medical bills and other end-of-life expenses, but the pending criminal charges paint a picture of undue influence rather than philanthropy.
The attorney allegedly approached patients nearing the end of their lives and offered cash payments between $2,000 and $3,000 to those who would sign paperwork. The paperwork signed by the patients opened accounts in their names in financial instruments including variable annuities and death-put bonds. Both types of instruments provided profitable returns to the holder of the instruments.
Although no specific law prohibits making a profit from another person’s death, prosecutors allege that the attorney never explained to the patients that they were signing documents that would generate profit for somebody else when they died. Prosecutors also claim that the attorney and his associate misrepresented patients’ investment experience and, in some cases, forged peoples’ names on account documents.
One patient testified that he understood the offer as a gift that involved nothing more than signing his name to documents. Although the patient received $3,000 cash, he testified that he did not knowingly agree to have accounts opened in his name and did not even recognize some of the documents bearing his signature. What may have seemed like a gift at the time now apparently looks to the patient, and to federal prosecutors, like a callous act of fraud.
Source: Turnto10.com, “Trial opens for philanthropist accused of defrauding ill,” Michelle R. Smith, Nov. 13, 2012