How many times have you opened the newspaper and flyers advertising “free living faith seminars” fell? They often offer free breakfast or lunch and hold meetings at local restaurants.
In California, these seminars are often hosted by non-lawyers whose primary purpose is to sell living trusts to everyone present (regardless of whether trusts are required), and to follow up on annuity sales to participants. This is a high-pressure event with many follow-up calls to each participant who refuses to purchase a trust plan after receiving a free breakfast or lunch.
No free lunch. Organizers have spent money on newspaper advertisements, renting meeting rooms and paying for food. They need to recoup their investment and make a profit. In doing so, they instilled the fear of God into every participant by making them believe that they must have a trust or their home and life savings are in danger.
To avoid being accused of practicing law without a license, they often contract with an attorney who will “oversee” the formation of the trust. In reality, the attorney never speaks or meets with the client, but develops a checklist that non-lawyers can follow to create a boilerplate trust document.
Not everyone needs trust. The two main purposes of establishing a trust are for tax avoidance (where the estate is substantial) and to transfer title to the property to avoid having to “certify” the estate. When these two goals are not involved, trust may not be necessary. Again, the organizers of this seminar don’t care whether you need trust or not. Their goal is to make a profit.
Often, after the guardianship package is sold at one of these free seminars, the so-called estate planner representative then visits the elderly couple to review the guardianship and obtain the required signatures. However, the representative also had ulterior motives. That person is now armed with all the financial information of the elderly couple (remember – no confidential attorney-client relationship) and makes a sales pitch to sell them an annuity. Annuities may not at all be suitable as a financial investment for an elderly couple; however, the annuity seller doesn’t care because he will get a large commission from the sale.
This kind of high-pressure selling tactic continues to be used against unsuspecting elderly citizens who think they will only spend an hour or so on a free lunch gathering general information about living guardianships. Little do they know that they will be pressured to not only buy a trust plan, but then invest their life savings into annuities that make no financial sense to them but fill the pockets of unscrupulous annuity sellers.
My advice: Remember that there is no such thing as a “free lunch”. If you think guardianship might be beneficial for you and your family, contact an attorney, schedule a free consultation, and bring your spouse or other trusted loved one. Avoid “trust factory” scams at all costs.
