A Pennsylvania lawyer was disbarred recently after a hearing that revealed a years-long practice of high pressure selling of estate planning or probate avoidance kits. For a substantial fee, individuals signed up to have living trusts prepared. Nearly all of them never saw or spoke with the lawyer who was preparing the trust, which he did based on forms provided to him by national sellers of these products. All contact seems to have occurred through non-lawyer salespeople. When the trusts were prepared and delivered, the selaesperson then embarked on a fast-talking, aggressive effort to sell annuities that included high fees. The disciplinary board that reviewed the evidence concluded that a number of rules applicable to lawyers had not been complied with: in nearly every situation, the lawyer never met with the “clients”; no analysis was done to determine that a living trust was appropriate; fees were divided with non-lawyers; etc. In short, older people paid a lot of money for something that usually wasn’t necessary or appropriate, and were pressured into buying products that were poor investments. Unfortunately, this isn’t the only circumstance we are seeing, in Pennsylvania and elsewhere, of senior citizens being sold a bill of goods and cheated out of at least part of their retirement funds.
This is not to say that annuities can’t be a good investment. Many very savvy investment advisors suggest them to clients when they are appropriate. But they can’t be appropriate in every situation. And when they are, sellers should provide the best annuity product for the clients, not the one that earns the highest fees. And having estate planning done through a kit that you buy from a non-lawyer who knows nothing about you or the applicable law makes as much sense as buying medical or dental care on-line: “tooth hurt? we’ll tell you how to fix it yourself with our dental drill delivered to your home.”