Bankrupt beneficiaries want me to commit possible fraud

Niall02

Thank you everyone.

One beneficiary is also a joint executor ....yes I know....He is bankrupt but now saying I am withholding funds from him as not paying his wife the money (Diverting fund fraudulently from his trustee).

He is now saying as I am not paying him (his wife account was given) he is going to get a solicitor on the estates cost and take me to court and charge the estate for this. He says not to contact him further as this is harassment. I just emailed him once to ask his trustee how to proceed.

I spoke to a lawyer and there advice was "Stay out of court and mediate as much as possible, you do NOT want to go to court" His fees are 290+ VAT just to start writing letters to the bankrupt and insolvent beneficiaries.

The other beneficiaries are just as angry as I sent an email out asking them to state if they were insolvent or bankrupt. Found them on the .gov register but didn't reveal this, I was just hoping they would be honest.

I'm an executor get me out of here

xylophone

I'm an executor get me out of here

It is clear that managing the estate in these circumstances is beyond your level of knowledge and expertise.
The estate will just have to bear the cost of expert advice.
The example below is  aimed at the person in financial difficulties but the solicitors could equally well advise an executor  how to proceed.  
https://www.stephensons.co.uk/site/businesses/insolvency_solicitors/bankruptcy_advice/

MoneySeeker1

I have an idea that someone doesn't have to be an executor - just because they've been named as one - and that there is a process whereby one can voluntarily give up that role. Wondering whether that might be your best solution - and then at least you've "kept your hands clean" whatever else happens.

Maybe there might be a way to pass on the executor-ship you hold to a suitable solicitor (who would obviously charge the estate for their services) and then they'd be the one dealing with troublemaker executor.

Of course, the other thought is your fellow executor may be deliberately hassling you precisely in order to get you to give up being executor - thinking that would leave them free to do exactly what they please - but do bear in mind they have to produce a set of accounts at the end of all this for you to see. Also bear in mind bodies like HMRC and the like might like to "catch them on the hop" if they don't do things by the book.

You know them personally as to which would be most effective. Myself - I value my reputation and keeping my own finances I already have intact - and so I'd probably give up the executor role to protect both those things. Then watch them like a hawk and be right "on their case" re providing accounts etc.

naedanger

MoneySeeker1 said:

I have an idea that someone doesn't have to be an executor - just because they've been named as one - and that there is a process whereby one can voluntarily give up that role. Wondering whether that might be your best solution - and then at least you've "kept your hands clean" whatever else happens.

Maybe there might be a way to pass on the executor-ship you hold to a suitable solicitor (who would obviously charge the estate for their services) and then they'd be the one dealing with troublemaker executor.

Of course, the other thought is your fellow executor may be deliberately hassling you precisely in order to get you to give up being executor - thinking that would leave them free to do exactly what they please - but do bear in mind they have to produce a set of accounts at the end of all this for you to see. Also bear in mind bodies like HMRC and the like might like to "catch them on the hop" if they don't do things by the book.

You know them personally as to which would be most effective. Myself - I value my reputation and keeping my own finances I already have intact - and so I'd probably give up the executor role to protect both those things. Then watch them like a hawk and be right "on their case" re providing accounts etc.

I think this is a very bad idea (if it is even possible given the OP's extensive involvement already as an executor).

A set of accounts is not much use if an executor (especially a bankrupt one) has lost the estate significant sums of money. And if the remaining executors just endlessly delay the accounts production how are the beneficiaries going to force them? 

HMRC is only going to be interested in getting any money due to them back in the easiest permissible way. 

Keep_pedalling

MoneySeeker1 said:ŷ

I have an idea that someone doesn't have to be an executor - just because they've been named as one - and that there is a process whereby one can voluntarily give up that role. Wondering whether that might be your best solution - and then at least you've "kept your hands clean" whatever else happens.

Maybe there might be a way to pass on the executor-ship you hold to a suitable solicitor (who would obviously charge the estate for their services) and then they'd be the one dealing with troublemaker executor.

Of course, the other thought is your fellow executor may be deliberately hassling you precisely in order to get you to give up being executor - thinking that would leave them free to do exactly what they please - but do bear in mind they have to produce a set of accounts at the end of all this for you to see. Also bear in mind bodies like HMRC and the like might like to "catch them on the hop" if they don't do things by the book.

You know them personally as to which would be most effective. Myself - I value my reputation and keeping my own finances I already have intact - and so I'd probably give up the executor role to protect both those things. Then watch them like a hawk and be right "on their case" re providing accounts etc.

You can do that but only before you start to administer the estate, which is what the bankrupt executor should have done. 

xylophone

I have an idea that someone doesn't have to be an executor - just because they've been named as one - and that there is a process whereby one can voluntarily give up that role.

It is possible to renounce before undertaking the role - not after having "intermeddled".

https://sasdaniels.co.uk/blog/2020/06/18/intermeddling-with-an-estate/

The OP has been  trying to complete administration of this estate for the last five years......

Savvy_Sue

The OP cannot renounce, but can instruct a solicitor to act on their behalf and charge the estate. They have already had some advice, but it looks as if mediation may not be an option. Personally I'd pay for that first letter to go to the other executor and beneficiaries, advising mediation and reminding them that legal costs are coming from the estate. 

Would also be wise to remove that bankrupt executor - which they'll presumably fight, but hopefully if they DO consult a solicitor they will also be advised not to go to court ... 

Since that first letter would not be from the OP but from a solicitor, might knock some sense in? Well, I can dream ... 

Manxman_in_exile

I'd do what Savvy_Sue suggests.  If this has been going on for five(?!) years it's worth it just to try to get it sorted out.

TW1234

This is not a pleasant situation; get things wrong and you could be personally on the hook.
As executor you should have checked at an early stage whether any beneficiaries were bankrupt , if they were in the undischarged stage,and notified their administrator of the potential inheritance. The bankrupt should also have notified the administrator and would be in contempt of court if they have not done so. The crucial date is the date of death.
Why not check with insolvency services to find who was their administrator and consult them?
Given the potential complexities it may well be best to consult a solicitor and put the cost against estate expenses. I can't see the beneficiary having much success with a claim for delay.

Niall02

Hi everyone,

So now ready to give the money out.

One particular beneficiary is not giving me details of herIVA to pay the amount to. She is stalling and now ignoring my requests to send her money form the estate.

I'm sat here with their cash in the bank. How long can I wait until i become liable ? I'm assuming she wand me to hang on until their IVA is up with, which is 3 years? How long can I legally wait with her cash?

Please note this beneficiary applied for IVA during all of this, not before.

I hope that makes sense.