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Ours is a sad story like so many others. My in-laws were horribly abused by one of my wife's siblings. My father-in-law, who had his faculties, finally changed his POA to us last year and we took over their care. At least we were able to give him a descent last nine months and a real funeral service...unlike what would have happened.

Meanwhile, my wife's sibling took pretty large chunks of money from their parents including approximately $30,000 in cash after refinancing the reverse mortgage to take out more equity.

As this all happened within the last five years, we have been advised that in order to obtain Medicaid, we have to show that any large withdrawl over $1,000 was not a gift but theft, requiring criminal charges or a civil suit at a minimum. In fact, when I approached the local Medicaid office late late week, I was told to come back wtih a criminal complaint and a filed out application.

We really don't want to prosecute my wife's sibling. While this person has been down a bad path, we really don't want the stress or knowledge that we sent a loved one to jail.

We've heard from a bystander that we cannot be forced to prosecute a family member. All of us live in NJ. Can we be forced to take this drastic step?

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Thanks, Pam. FIL is gone but filed a police report with me. We're guardians of MIL giving us the power to address this issue. Sure would have helped if FIL would have filed himself but refused to prosecute his child

So we've got the victim - MIL - and we're able to address in her name.

The problem is that we need to educate the criminal justice system in how to prosecute. Any ideas as to which part of the criminal code?
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runragged, if the parents will not come out and say he stole from them, there are no charges. It's that simple.
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Under what NJ statute can charges be filed and my wife's sibling prosecuted? Anyone familiar with any case law in NJ that would help? Dare we ask - are there federal criminal statutes we could leverage?

Fast forward from our last post on August 6th to today. We attempted to file charges. We dropped off the probably fraudulent reverse mortgage, bank statements, what-have-you with the local police. Then we waited...and waited...and waited.

In response to my call for an update, a detective called me back late this afternoon and explained that in speaking with the county prosecutor's office, it doesn't appear to be a criminal complaint but a civil issue. I begged to differ. The detective told me that it wasn't morally right, just not something criminal. However, if there's a way that prosecution can happen, the prosecutor's office has left it open for us to provide that.

Can anyone help us with this? We've reached out to our attorney and the Office of the Ombudsman for the Institutionalized Elderly, but this looks like a sticky one having tried to look the law up myself.
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runragged, I am so sorry you are in this position. There is no way you can serve the best interests of everyone in the family when those interests conflict. If your wife now has POA her primary responsibility is toward her mother. It must be very painful to have to me the one who draws down the consequences of Sister's actions on Sister, but covering up for her hurts Mother.

I wish you strength as you and your wife do what you have to do for her mother's sake.
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I know it can't feel good or right, but without a doubt you are doing the right thing. In the long run, it is no good for sister to be allowed to live life without character and without consequences even if that's exactly what she expects will happen. bless you all!
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Thanks to everyone for your encouragement! We hope that all works out.

In terms of when the house was refinanced, that happened only a couple of years ago. Unfortunately, very little of the money went toward their care. The vast majority walked out of the bank in cash. That's the basis of the criminal charges. We could go further based on the abandonment/neglect, lack of medical care, etc...but one charge is enough.
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Best of luck to you in deciding to proceed with the charges. Actions have consequences. Fines or jail or not on you, let them own their own behavior
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When was the original reverse mortgage taken out? If it was within 5 years, I hope your inlaws used it for their care. There is also the matter of paying back the total amount of the refinanced reverse mortgage or the home will be foreclosed. Reversed mortgages, like deferred real estate taxes, can be a blessing for the elderly on a fixed income, but it becomes a nightmare when applying for medicaid or settling their estate.
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There is no way that my wife's sibling can come up with the receipts to show that the money was spent on Mom's and Dad's care. There's no way that sibling will pay back a dime.

OK, as hard as it is, we'll go forward and file those charges as soon as possible.
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I'm sorry it is no fun to have to press charges against a family member, but if they stole $30,000 plus, put that into perspective and man up and do it. Otherwise, because of the Medicaid penalty period, that money comes out of your hide, which hurts either you because instead of a retirement with financial security and a little travel, you will be struggling with the finances; Mom because you can't afford the care she needs; or maybe your kids who could have used that in their college fund. You can choose to hurt either the guilty party in the family or the innocent people in the family. You can give Sis the option to pay it back or document that it was all spent on Mom's care in some way and see if she can, but if that doesn't happen and you don't prosecute, or at least report it as a crime and let someone else decide whether to prosecute or not, you are making the wrong choice.
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What happened is a crime and should be reported to the district attorney for investigation and prosecution. No other way. Medicaid won't pay.
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A copy of the reverse mortgage that was recorded is what I meant to write.
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If you don't have a copy, you can get one from the Register/Recorder of Deeds and check the signatures. If the DPOA was used as representative of your wife's sibling, it likely would have been recorded just prior to the reverse mortgage.

Does your MIL have a copy of the Application?
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That's a good point about the reverse mortgage potentially being fraudulent. That may, in fact, be the case. My wife's sibling had POA over all their affairs and may have use it to refinance. It is possible that either the signatures on the application were either forged or cohersed. If forged, we might get somewhere. If cohersed, we'll likely get nowhere. My FIL did not remember signing anything of the like and, as before, had his faculties. My wife's sibling claims that the action was taken in response to the direction of her dad. This person also claims that all the bills were up to date when I've totalled almost $14K in unpaid debts that have sought repayment since we became the Attorneys-in-Fact.

Thank you, MaggieMarshall, for your insight as well. That's the problem I think we're facing. My MIL cannot afford the penalty.

Like I initially wrote, our sad story is probably a lot like many others out there. But it's still sad.
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Thanks for the clarification.

There may also be some issues of fraud re the reverse mortgage. Assuming that it was already in existence, it's my understanding that the sibling then refinanced and drew down on an additional $30K? How did she do that unless she was a co-mortgagor and co-owner as reflected by the title? This is a major issue.

I know that there are some really shady reverse mortgage lenders who prey on the elderly. But I would think that just ensuring their interests are protected, the reverse mortgage lender would require that the sibling have authority to refinance as well as encumber the property with a refinanced reverse mortgage.

If there was mortgage fraud, it would likely constitute a default under the terms of the mortgage, in that the sibling had no authority to encumber the property or take an advance on the funds. Both the mortgagee and your MIL and deceased FIL would be aggreieved parties. I'm sure the mortgagee would look out for its own interests.

I think this is where civil and criminal might overlap. Fraud, if intent to commit fraud (which I understand is a major element of that charge) can be shown, is a criminal action, but there might be a civil action basis as well arising from eggregious elder abuse. I'll leave this to your attorney - just throwing out some issues for consideration here.

Considering your desire not to see the sibling imprisoned, one option might be to begin a criminal action by contacting the police, and possibly any fraud task forces, for the purpose of putting pressure on the sibling. Then work out a repayment deal, or some kind of agreement whereby she surrenders the spoils of her ill conceived actions...if she hasn't already spent them.

This would involve working with a prosecuting attorney to negotiate such a plea bargain. But it might keep her out of jail, and might even help recover some of the funds.

If the funds are gone though, there really is nothing to recover, so I think that would be an element in your consideration whether to file criminal charges.

Again, I'll leave it to others to address the Medicaid issue, on which I have no knowledge.
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No, you can't be forced. But Medicaid will be excluding many months of paying for her care if you don't. People can't give away money and then claim hardship and ask taxpayers to pick up the tab. If she didn't GIVE it away, then they stole it. *shrug*
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Thank you, GardenArtist. We do have standing in that we would be prosecuting on the behalf of my still living MIL using temporary guardianship that was just granted. You are quite correct in that there must be a victim in order for there to be a crime. If no one will stand in for the victim if the victim is unable to stand in for him- or herself, then the crime will go unprosecuted.

We are wary of such advice...which is why we're asking this community. Our attorney does not seem to think there is any way out of taking this step. However, one never knows what options might be hidden that others may know...unless we ask.
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I assume your MIL is still alive?

I think you'd have to undertake any criminal charge on behalf of your deceased father (and/or living MIL) pursuant to any authority granted in his Will and/or Trust, as well as the authority you have to act on behalf of your MIL.

That would be the issue of "standing" that might have to be addressed first. Since they were the ones financially abused, unless the children were affected, you'd have to "stand" in the shoes of your in-laws to prosecute...at least that's my interpretation from working with litigators and some limited criminal work.

As to the issue of Medicaid forcing prosecution, that's well beyond my knowledge. There are others here, including Igloo, who are Medicaid experts and hopefully will come along to help you.

And I'd be careful about listening to advice of a "bystander".
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