Is it illegal for the trustee of a living will trust to spend trust funds not on the trust beneficiary, but instead on his own personal ventures (eg. real estate investments not deeded to the trust beneficiary or her estate, college tuition for his children, personal bills, etc.) I thought the trustee was obligated to apply any funds to needs and care of the trust beneficiary while they are alive, and upon the death of the trust beneficiary any proceeds are divided among the beneficiaries listed in the trust.
3 Answers from Attorneys
It depends on the terms of the trust, but this certainly does not sound proper or legal. Sometimes, however, the trustee is also a beneficiary. Also, trustees usually collect a fee. Without more detail that is really all that can be said.
An attorney would need much more information to give a full and complete answer. Is this trust irrevocable? Did the person(s) who set up the trust die? Are you a beneficiary and if so have you received or requested an accounting? If you received an accounting, have you ever formally objected to the accounting? You really need to consult with an attorney to give you specific answers to your questions.
Sit down with an attorney ASAP. Your question can only be answered with a lot more facts and after a review of the terms of the Trust.
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