The Preservation Group to refund $40k to seniors who bought living trusts
The atty. gen.'s office accused the Arizona-based company and its owners, Kevin D. Boterman and Robert J. Feinholz, of violating the state's Estate Distribution Documents Act, which prohibits anyone who's not a licensed attorney from marketing living trusts, a simpler way to pass on inheritances without going to probate court, or wills.
The Preservation Group marketed its services by holding informational seminars in the community and then scheduling appointments with seniors in their homes, according to the state's complaint. The seniors were told about the benefits of a living trust and disadvantages of probate, according to the state. Boterman and Feinholz allegedly misrepresented the complexity of the probate process in which the court supervises the transfer of property to a senior's heirs.
Convinced they had no other choice, seniors paid the company between $2,195 and $2,995 for a living trust. They also provided detailed personal and financial information to the company, which used it to make more sales pitches about additional services such as annuities and insurance, according to the complaint.
The atty. gen's office says Boterman and Feinholz were registered to sell insurance in the state of Washington but not licensed to practice law.
Betty Watterson, 81, is one of the seniors who paid Sam Eck, a Bellevue-based attorney, $2,195 for a living trust after Boterman talked her into it while visiting her home. She told the state Boterman also tried to pressure her into buying a tax-deferred annuity because he told her he hated seeing older people lose everything.
Watterson didn't end up investing in the annuity and tried to cancel the living trust. It took months to hear back from Eck. When he finally returned her call, he told her it was too late to request a refund.
Watterson said she was never informed that she only had three days to cancel the living trust. Eventually, the company prepared the document and told Watterson it would transfer her assets to the trust. But when Watterson contacted her bank to find out if her property had been transferred, the company had not done so.
Watterson called Eck and wrote him a letter requesting a refund, but the attorney denied her request, according to the state. No one from The Preservation Group could be reached for comment.
Under the settlement, the company and its owners are prohibited from selling estate planning products in the future. They've also agreed to pay up to $40,000 in restitution to eligible consumers who request refunds and $10,200 to reimburse the state for its costs.