Lawsuit filed in alleged trust scam targeting seniors (MN)

ST. PAUL, Minn. – Seniors are often targets for scam artists, who know how to take advantage of their tendency to trust too much.

That is exactly what Attorney General Lori Swanson says a Minnesota company is guilty of, and on Monday she announced a lawsuit has been filed to stop the practice immediately.

Swanson is suing Heritage Partners, LLC, for operating what she calls a “trust mill” through which senior citizens and future retirees were charged $2,295 for living trusts, wills, and related documents that were supposed to be prepared by an “experienced estate planning attorney.”

Instead, Swanson alleges, Heritage had the legal documents prepared by an Arizona man – also named as a defendant in the lawsuit – who is not licensed as an attorney in Minnesota or Arizona and who was previously banned from setting up sham business trusts in a lawsuit brought by the federal government.

Heritage sold over 500 trusts and estate plans to residents of Minnesota that were prepared by Lawrence, at a cost of over $1 million, according to documents produced by Heritage to the Attorney General’s Office during its investigation.

“With an aging population, many people are thinking of estate planning, and they should be on guard against “trust mills” that churn out legal documents with the ulterior motive of selling insurance products,” said Swanson.

The lawsuit claims accuses Heritage of using flyers and newspaper ads to invite senior citizens and people approaching retirement throughout Minnesota to “free” dinners at popular local steakhouses to learn more about estate planning, probate, and trusts. At the dinners, prosecutors say Heritage extolls the virtues of living trusts and exaggerates the dangers of dying without a trust.

Heritage salesmen, who are insurance agents, then allegedly arrange individual meetings at prospective clients’ homes. During the home visits, the sales agents recommend that clients purchase a trust, will, and related documents from Heritage, usually for $2,295.

Court documents say Heritage tells clients that the trusts, wills, and other documents will be prepared by an “experienced estate planning attorney” and states this in its contracts with consumers. Instead, Heritage uses an Arizona man—Dennis Harold Lawrence and his company Legal-Ease, L.L.C.—to prepare the trusts and wills. In 2005, the Internal Revenue Service filed a lawsuit against Lawrence for running a fraudulent trust scheme in which he obtained sales leads from insurance agents and then sold trusts to businesses to unlawfully shield them from taxes.

The IRS called those trusts “shams.”

The lawsuit, filed in Hennepin County District Court, alleges that both Heritage and Lawrence engaged in consumer fraud and deceptive trade practices, that Heritage violated Minnesota’s three-day right to cancel law for in-home sales and the fiduciary duty statute for financial planners, and that Lawrence engaged in the unauthorized practice of law in Minnesota.

It seeks legal relief and restitution for consumers.


Lawsuit filed in alleged trust scam targeting seniors
KARE 11 Staff,
February 3, 2014