Private Equity's Courtship of Retail Investors Irks Pensions, Endowments
Institutions such as pensions and endowments are increasingly concerned their negotiating power may be sapped as private equity funds allocate more money to doctors, lawyers and other everyday customers who pay full freight. Other big-money investors are asking how much of each private equity deal they'll have to share with funds marketed to individuals, leaving less available for themselves.
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Yahoo
26 minutes ago
- Yahoo
‘Absolutely no one pays attention': I could steal from my children's trust fund without them having a clue
I don't believe the young person writing to your column this week is conflating their disappointment in their mother with financial mismanagement. It would be exceptionally easy to do if one were so inclined. My husband died about 18 months ago when our boys were in their early 20s. I handled all of the paperwork and transfers of accounts after he passed, and I could have been taking money out of the boys' trust for myself without them having a clue. Homeowners rush to refinance as mortgage-rate plunge opens window of opportunity I'm a senior who barely survives on $1,300 a month. No way could I live on $1,000. Is the time-honored 15% tip for restaurant service becoming the norm again? What 20-year-old boy knows anything about such things? If I hadn't told them about the trust, they wouldn't even know it existed. I am on the paperwork as the guardian of the trust, and if I filed the IRS paperwork every year, who's to know where the disbursements go? Absolutely no one pays attention, and while our lawyer set it all up for my husband and me, she was not involved at all after his death. To be clear, I am managing all of it for my boys, not touching a penny. Before my husband passed away, our lawyer suggested changing me to the beneficiary of the trust in question, and I said no. I continue to manage it for our boys. I hope you will consider this scenario going forward. Widow & Mother Related: My brother's 'good daughter' siphoned $70,000 from her father's accounts. Should she still get an inheritance? Don't miss: 'Things are getting tougher': I'm struggling with $145,000 in debt. Should I refinance my 3.5% mortgage? The beneficiary of a trust or bank account can become vulnerable to bad actors, and, yes, that bad actor could be the remaining parent who decides to help themselves to the money or pay themselves exorbitant fees. You are correct about that. The daughter in the letter you mentioned was 20 at the time of her father's passing and, in the eyes of the law, was of age to control her own bank account if she was listed as a beneficiary. The financial institution has a fiduciary duty to pass that account along. If there was a will, as the daughter suggested, that will would be made public. She could contact the probate court in the county where her father lived to access a public copy of any will in existence. More likely, from her retelling, her mother inherited most of her husband's estate. But inheritance theft is real — and the pages of this column are rife with sordid tales of missing money and skullduggery. Such malfeasance could include forged amendments to wills or trusts, missing or destroyed documents, emptied safe-deposit boxes, and/or gifts becoming 'loans.' The best way to prevent this is to choose a trustworthy trustee and, even better, choose two trustees who they can keep an eye on each other. As you point out in your letter, transparency and full disclosure of an estate plan would keep everyone in the loop. When beneficiaries and heirs are kept abreast of the contents of an estate and who is named as a beneficiary, it is much harder to fritter away money without the knowledge of those parties. The more you disclose, the harder it is to hide criminal behavior in plain sight. 'Trustees are responsible for managing a trust in a way that avoids conflicts of interest and ensures it is administered in the best interest of the beneficiaries,' according to J.P. Morgan Wealth Management. Otherwise, they could face civil and criminal penalties. 'The trustee should not use the trust assets for the trustees' own profit and must avoid any adverse interests that conflict with those of the beneficiaries,' it adds. In some cases, it's wiser to appoint a professional rather than a family member who may be tempted to self-deal. 'Consider a scenario where a family business is owned by the trusts and a key executive who runs the business is also a potential trustee,' J.P. Morgan says. 'If that person is selected as a trustee while also running the business, it could lead to a conflict of interest.' Unfortunately, even if a couple has an agreement to pass assets down to the next generation, the surviving spouse can renege on that deal if the estate plan is not airtight. This can be particularly painful and common in blended families with second spouses. Managing a trust requires balance: Trustees can also be held liable if they act recklessly. Most states have adopted the 'Prudent Investor Act' where a trustee is required to invest trust assets under a program of diversification to provide income and/or growth of principal. The prior historical rule, known as the 'Prudent Man Rule,' focused more on the need to preserve assets, leading to conservative investments that may have provided income and did not allow for growth of the trust principal. 'No one can perfectly predict the outcome of every investment decision, but a trustee must apply the prudent investor rule when making investment decisions based on the information available at the time,' according to a guide from Fidelity. 'Whether the outcome is good or bad is not a factor if the trustee followed the principles of the prudent investor rule,' it adds. 'The nature and level of the investment risk should be compatible with the aims of the trust and its beneficiaries.' Not every trust will have the same goals, which should be set out by the grantor. 'Trustees are expected to analyze and make sound decisions that are compatible with portfolio distribution requirements, the level of risk tolerance and other factors,' Fidelity adds. A beneficiary who suspects dodgy dealings can take action. In most jurisdictions, the legal right exists to compel a trustee to provide a report of their activities, including financial information; if they refuse, they can compel the trustee to do so via a court petition. Under Federal Deposit Insurance Corp. rules: 'A trustee must keep and render accurate accounts. The accountings should reflect receipts and disbursements, gains and losses on investments, and other transactions affecting the account.' 'Such records are also necessary for completion of tax returns. Usually, the state law requirements apply to testamentary trusts or court-appointments and call for accountings to the court at specific intervals.' It's difficult to steal money from a trust outright, which is why we hear the phrases 'embezzlement' or 'misappropriation of funds' where a trustee diverts funds for their own use. That could involve something as simple as paying themselves extortionate fees. Your boys are fortunate to have a mother who is looking out for their interests. We may never know for sure whether the daughter in the previous letter was right to suspect her mother of mismanaging funds from the family trust. The good news: When beneficiaries do suspect foul play, there's a lot they can do. Don't miss: My late husband's employer is forcing me to take 10% 401(k) distributions. Help! Previous columns by Quentin Fottrell: 'I have a great mortgage rate': I need $80K to buy my husband out of our home. Do I raid my $180K Roth IRA? 'I'm tired of corporate America': My wife and I have $1.65 million. I'm 61. Can I retire already? 'This scam stuff is going to get worse': A man approached me in my car — he had a crazy story An economic reset is underway which will drive the S&P 500 to 7,500 next spring, one strategist says These Eli Lilly executives have been scooping up stock after its big drop Why a jumbo Fed rate cut in September would 'come across as panicky' Sign in to access your portfolio
Yahoo
26 minutes ago
- Yahoo
Priscilla Presley's ex-business partners sue her for more than $50 million, alleging fraud
Priscilla Presley's former business partners have filed a lawsuit seeking more than $50 million in damages, alleging fraud and breach of contract. Brigitte Kruse and Kevin Fialko filed the lawsuit Monday in Los Angeles Superior Court. Among many other allegations, they say Presley used them to financially exploit her name, image and likeness, hiding the fact that she had sold those rights decades earlier. The lawsuit comes just over a year after Presley, the 80-year-old former wife of Elvis Presley, sued Kruse and Fialko, alleging they engaged in elder abuse in a 'meticulously planned and abhorrent scheme' to 'prey on an older woman by gaining her trust, isolating her from the most important people in her life, and duping her into believing that they would take care of her (personally and financially), while their real goal was to drain her of every last penny she had.' Kruse and Fialko's lawyer, Jordan Matthews, said in a statement Wednesday that the 'evidence will establish that the real victims here are my clients, who invested millions and years of hard work into revitalizing Priscilla Presley's brand, only to be betrayed and falsely accused once the money was on the table and every personal and business issue had been resolved.' An email seeking comment from Presley's lawyer was not immediately answered. Kruse and Fialko's lawsuit says Kruse is a well-known auctioneer and Fialko a successful entrepreneur, both of whom dealt in Elvis Presley memorabilia. The duo previously sued Priscilla Presley in Florida. They say she approached them in 2021 looking for help to save her from financial ruin, which they spent thousands of hours working to do. 'Kruse and Fialko deployed IP, know-how and creative marketing to enhance Priscilla's brand,' the lawsuit said, and formed several companies to exploit her name, image and likeness. But they say as this was happening, Presley hid from them that she had sold the rights to license her name as part of a $6.5 million deal with Elvis Presley Enterprises in 2005. The lawsuit says that when confronted about the previous agreement, Presley repeatedly denied making it, and later said she had forgotten about it when confronted with evidence of it. The lawsuit also alleges Presley sought to take advantage of the 2023 death of her daughter and Elvis Presley's heir, Lisa Marie Presley, to aggrandize herself and regain a stake in the Elvis' estate. Priscilla and Elvis Presley were married from 1967 to 1973, divorcing four years before the death of the rock 'n' roll legend. Kruse and Fialko say they brokered a 2023 deal to end a legal fight over the estate between Priscilla Presley and Lisa Marie Presley's daughter, actor Riley Keough, getting Priscilla Presley $2.4 million. But the lawsuit says she cut them off in violation of contracts soon after, publicly smeared them and later sued them. Priscilla Presley's lawsuit says that Kruse and Fialko fraudulently convinced her they were essential to her recovering financially, and that her former trusted advisers had been cheating her. It said they compelled her to take part in sham companies, lost control of her name, image and likeness, and forced her into 'a form of indentured servitude.' 'By isolating her and immersing themselves in every aspect of her life, the Defendants were able to fraudulently induce Presley into giving them power of attorney, control over her family and personal trusts, and control over her bank accounts," the lawsuit said. Priscilla became a major public figure when she was a teenager because of her relationship with one of the world's most famous men. She never left the public eye, but she has regained a special prominence in recent years through Baz Luhrmann's 2022 film 'Elvis' and Sofia Coppola's 2023 film 'Priscilla,' based on her memoir. She is also an actor who starred in the original 'Naked Gun' franchise in the 1980s and 1990s, and she had a cameo in the new reboot. Andrew Dalton, The Associated Press
Fast Company
27 minutes ago
- Fast Company
How proptech is driving financial inclusion
The fastest-growing group of real estate investors? They're not hedge funds or institutional investors. They're nurses, teachers, NASA engineers, and first-time landlords with a smartphone. In recent years, 85% percent of investor-owned residential properties were purchased by small scale 'mom and pop' landlords, rather than institutional players. Thanks to property technology, investors no longer need deep pockets, a finance degree, or a ton of spare time to start building a real estate business. Real estate has long been one of the most capital-intensive, time-consuming, and difficult asset classes to break into. But proptech is dismantling many of the long-standing barriers that once kept many people out, redefining who gets to invest, who gets to earn, and who gets to build wealth from real estate. Just as fintech became essential infrastructure for financial inclusion, proptech is democratizing real estate investing through smart, values-aligned innovation. Time is no longer the gatekeeper In the past, investing in real estate meant navigating a maze of manual tasks—collecting paper checks, coordinating maintenance by phone (often in the middle of the night), and tracking expenses with pen, paper, and shoeboxes. The time commitment required wasn't feasible for most people. Today, modern software platforms automate and centralize nearly every step of the process. Automated five-pronged tenant screening tools deliver instant background and credit checks. Lease agreements can be generated digitally and signed online. Rent is collected automatically via mobile apps. And maintenance requests flow through clean, trackable dashboards that dispatch vetted local pros without bothering the owner at odd hours. That kind of automation has opened the doors to investors who once felt priced out—not financially, but in terms of time and attention. I've seen it firsthand. One landlord and long-time RentRedi user, a NASA engineer named Dawid, manages his real estate business in the evenings and on weekends while continuing to work in aerospace. Proptech makes it possible to treat real estate like a side hustle, rather than a full-time obligation. Financial barriers are no longer the dealbreaker There's no denying it: The financial hurdles to buying property have grown steeper. Home prices are high. Interest rates have increased. For many aspiring investors, the traditional path to ownership feels out of reach. But while the barrier itself has risen, proptech is helping people find strategic ways to overcome it. Digital tools are making creative income strategies—like renting out space or co-owning properties—more accessible and easier to manage than ever before. By generating income from day one, many of these strategies reduce the amount of personal capital needed to cover costs. That means investors can start smaller, take on less risk, and enter the market more affordably. The result? A new wave of homeowners and investors who are building wealth one step at a time. Creative property monetization: Turn space into income Even without renting to long-term tenants, homeowners can generate meaningful income from underutilized parts of their property. Proptech platforms make it easy to list, manage, and monetize these spaces, turning idle square footage into opportunity. One of the most rapidly growing real estate trends is accessory dwelling units (ADUs). These are separate, self-contained structures on a residential lot (often detached in backyards or converted from existing garages) that can be rented out for short- or long-term stays. Creative models can lower the financial strain of ownership and allow people to begin investing in real estate incrementally, without the need for multiple properties or large upfront capital. Scale without the traditional infrastructure For investors who start small—whether through co-ownership, or a single rental unit—scaling is traditionally the next big hurdle. Growing a real estate portfolio used to require hiring property managers, assembling in-house teams, or outsourcing to expensive service providers. The overhead alone made it difficult to expand without deep pockets or significant infrastructure. That's no longer the case. Today, an individual with the right property management software can manage 1, 10, 50, even 100 units independently. Operations that once required a staff can now be handled from a mobile dashboard in minutes. Investors can grow their portfolios incrementally without sacrificing their full-time careers or quality of life. Another customer, Katherine, is a pediatric ICU nurse who wanted to create passive income for retirement. She started with three units and has since expanded her portfolio to eight units in just three years, managing it alongside her demanding healthcare schedule. These aren't isolated success stories—they're part of a growing trend. Proptech means real estate investing can become something people can build around their lives. The tools once reserved for big players are now in the hands of everyday investors. This shift lowers structural barriers for underrepresented groups. Young, minority, and female investors who have historically faced the steepest entry points are now scaling businesses with little more than a smartphone and a solid strategy. A new era of inclusive real estate investing What fintech did for Wall Street, proptech is doing for Main Street real estate. It's unlocking ownership, income, and long-term financial opportunity for more people in more places, with fewer of the barriers that once made real estate the domain of the already-wealthy. As more people access real estate as a means to build wealth, proptech helps reshape who owns housing in America—and how that ownership affects communities, families, and futures. This is more than convenience. It's a structural change and the beginning of a more inclusive, more entrepreneurial economy.
