An elderly friend added her Godson to her bank accounts. Had no intentions of giving permission for him to take money. A few months after adding him, without permission he took more than $20,000. Is there anything she can do about it legally since she did put him on the accounts? She put him on there in case she became disabled or sick and trusted that he would help her if that happened and he could take the accounts once she passed away. She has since taken him off her accounts but is out more than $20,000.

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The story about your friend serves as a strong warning to people who are thinking about Joint Ownership as an inexpensive way to plan for future disability.

Some of the cost of your friend's lesson might be recovered, if your friend hires an attorney to pursue the Godson with a legal action for conversion of your friend's funds.

But there would be costs of investigating Godson's whereabouts and his assets, plus the attorney fees and court costs of pursuing the culprit. People who take advantage of elders are likely to be "judgment proof" themselves by virtue of their own financial practices. An attorney in your state could assess whether it is worth going after Godson.

For those who read this story: avoid Joint Ownership. Consider the risks:
you may be setting up income tax problems;
transfers will have to be undone you if you need Medicaid to pay for Nursing Home care within 5 years after the transfer, and as Godson demonstrated, transfers can happen without your knowledge;
your Joint Owner could go into bankruptcy, dragging your money with them;
your Joint Owner could get divorced, dragging your money into the divorce proceedings;
your Joint Owner could have a serious accident, leaving your money subject to recovery by the injured party;
you may come to your senses and decide you don't want the Joint Owner having hooks in your money, but they refuse to sign off the account.

The good news is: you can plan for future disability with a Trust that specifically lists the powers and duties of the Trustee. The Trustee remains liable for any action he or she takes, and the Trustee must account to you and any other surrogate you designate, to keep track of what the Trustee is doing.

Even a Power of Attorney document that requires accounting by the person you designate as agent is better than signing over a bank account to a Joint Owner.
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Dear Josun123,

I'm very sorry to hear what happened. It is so tough. Because she added his name to the bank account, I believe this would give him permission to withdraw as much as he wanted unless specific provisions were made.

Your friend could talk to an elder law attorney, or the police and see if case for fraud could be made. Or maybe pursue a lawsuit through small claims court.

It is a horrible betrayal and I know she wants her money back. But she might have to accept this money is gone now. I don't know if other family members or friends could shame him into giving the money back.
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