Kenneth Hoesch was an attorney in Zeeland, Michigan. Mr. Hoesch specialized in trusts and estates. This is definitely an important specialty area; the correct application of trusts can increase the amount of money that flows to beneficiaries and decrease the money lost to federal and state estate and inheritance taxes. Unfortunately, Mr. Hoesch had other ideas.
Bluntly, he embezzled from the trusts to the tune of between $800,000 and $900,000. A third of the funds were stolen directly from trust accounts meant for beneficiaries (including charities). The remaining two-thirds was stolen from a pre-disbursement account. With interest, the balance due is now $1.295 million.
A potpourri of federal agencies and the local sheriff’s department investigated Mr. Hoesch. He was indicted and pled guilty last year to mail fraud and tax evasion (yes, the money he stole should have been on his tax return). He was sentenced today to 6 1/2 years at Club Fed. He also must make restitution to the victims and to the IRS (he owes nearly $212,000 to the IRS).
It’s very important that if you have trusts that the trustees be trustworthy. Having multiple trustees may not be feasible, but make sure you check references and review the accounts. Thankfully, it’s rare to see a trust attorney falling into distrust.
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