Monday, May 9, 2022

Michigan’s guardianship system leaves vulnerable exposed


George Pappas poses for a portrait with his Toyota Prius outside his apartment in Harbor Springs on Thursday. Elise Page was appointed as Pappas’s conservator in 2019. Page was convicted of embezzlement in 2021 for stealing thousands of dollars from Pappas.

A conservator who took a 95-year-old man’s debit card on a shopping spree at Victoria’s Secret.

Another who hasn’t accounted for $17,000 from the sale of a 74-year-old man’s land, and a third on trial, accused of embezzling funds from 11 vulnerable individuals.

Record-Eagle reporters in August 2021 began examining records in 10 of Michigan’s probate courts. They found a steady stream of worrisome stories ranging from family isolation to outright theft.

The stories involve people of means and those on fixed incomes, people who live independently and those who require residential care, those with close family members and those without, but all have one thing in common: They begin with a judicial decision meant to protect them by appointing a guardian or conservator.

Anecdotally, thousands of guardians and conservators — acting as fiduciaries — serve in their roles without running afoul of the law. Still, they are barely monitored by the courts that hand them the keys to a person’s estate. The State of Michigan has no rules governing who can serve as an appointed guardian so long as the person is older than 18. Often, vulnerable adults have little control over some of the most important decisions in their life — like where they live, who they can see, and how their savings are spent.

Decades of reform attempts by governors, attorneys general and legislators failed to alter the Michigan judiciary, which controls guardianship, keeping a casual eye on a system that lets bad actors harm the vulnerable.

During a nine-month investigation, Record-Eagle reporters found the following:

  • Probate courts aren’t built to audit and monitor what guardians do with their wards.
  • Protocol changes by the state judiciary, made in the name of reform, weakened state oversight.
  • Three employees in the Attorney General’s office are tasked with keeping a watchful eye on more than 1,600 vulnerable individuals who have no family members interested in their well-being.
  • Reform efforts have come and gone with little to show, the result of repeated efforts by judges and professional guardians to resist oversight changes. Those efforts are being revived today.
  • “Good” guardians are sorely needed, but the job often pays pennies and encourages professional guardians to oversee as many wards as possible.

George Pappas holds a photo of himself and his late wife, Geneva, at his apartment in Harbor Springs.

Robbed of money and dignity

In early December 2020, George Pappas had to pay his utility bill.

At 95, it was a point of pride for Pappas that he could drive, even though he’d recently had a conservator appointed to manage his money. After Pappas’ wife, Geneva, died in 2019, Pappas said he tried to keep up with daily chores, but eventually told a social worker at a local Veterans Administration office he needed help.

Pappas asked if someone could schedule his dental appointments, arrange to have the brakes on his car fixed and help arrange a pre-paid burial.

Records show the social worker told him he needed a conservator and referred Pappas to Emmet County Probate Court. Judge Valerie Snyder appointed a Harbor Springs woman named Elise Page.

Probate courts in Michigan are run by elected probate judges, and with no backgrounding rules from the state, the judges have latitude on how to find and vet the guardians and conservators they appoint.

In Page’s case, court staff asked the sheriff’s department to run a background check before adding her to a list of those willing to serve. That check found no criminal convictions; yet records kept across the hall in district court show a number of debt collection cases, all since closed, filed against her. Unpaid loans, a bounced check to a Petoskey florist, and debt for medical services.

Soon after her appointment, Page closed Pappas’ bank account, moved his money to a credit union and applied for a debit card in her own name. Ten days later, Page went on a shopping spree at vape shops, fast food drive-thrus and Victoria’s Secret.

She was eventually caught, but not by the court. Pappas paid his utility bill with a check from his old bank account and when it bounced, he told a clerk at city hall. The clerk called the police.

By then, Page had transferred $63,665 from Pappas’ old bank account — his entire balance — into the new credit union account, police records show. During the next few weeks, Page withdrew $10,300 in cash and spent another $3,615 with the debit card.

Dressed in a robin’s egg blue suit, Pappas testified righteously at the sentencing hearing after Page was convicted of fraud in the case.

“My wife worked 30 years to earn money and this person took advantage of that, blood money, for her prosperity and her hunger,” said Pappas.

Pappas’s story speaks to the casual accountability mechanisms in place for guardians and conservators. Conservators have about two months to tell a court how much money they’re responsible for. After that, they file annual reports with line items detailing expenses. Courts don’t require receipts and these financial reports are often as brief as, “Rent: $7,000,” “Car: $4,000.”

If anything looks fishy, casting the net to catch the fish isn’t the court’s job. Michigan probate courts are only responsible for monitoring whether guardians and conservators file financial and other documents on time and that these documents are sent to “interested parties.”

It’s those interested parties — a spouse, a daughter or son, siblings or staff with a government benefit agency like Social Security — and not the court who bear responsibility for ferreting out wrongdoing.

“The court is not an investigative body, it’s a paperwork body,” said private practice attorney Patrick Cherry, of Cadillac, a special assistant attorney general in dozens of guardianship and conservatorship cases, under contract with Attorney General Dana Nessel’s office.

Interested parties are not generally attorneys or accountants. Often they are family members who may have little experience with probate court matters and may not know they have the right to object to discrepancies.

“In my experience objections to accountings are fairly rare,” Cherry said.

In Pappas’ case, bank records show Page spent Pappas’ money weeks before the first accounting was due to the court.

‘Easy opportunity for exploitation’

Expenses made by conservator Elise Page on the account of
George Pappas, a 95-year-old WWII veteran who was appointed
a conservator in Emmet County. Page was convicted of
embezzlement in 2021.
In Grand Traverse County, former Probate Judge Melanie Stanton balked at the idea that courts should monitor the fiduciaries they assign. Stanton, who retired in 2021, said probate staff don’t have time, nor do they have access to LEIN — the statewide police backgrounding database. Probate courts also don’t have the flexibility to pick and choose who they put in charge, because there’s a lack of available guardians.

“A court doesn’t do an investigation,” Stanton said. “That’s not my role.”

In 2020, Stanton was tasked with sorting out the guardianship and conservatorship of Martha Rothaug, a Leelanau County woman with a significant estate and feuding adult children. Judges often appoint outside guardians in cases where siblings appear to be vying for a parent’s money. In Rothaug’s case, a woman named Jill Case was appointed in 2017 by Leelanau County Probate Judge Larry Nelson.

Case moved Martha out of her home and into a nursing home and transferred more than $500,000 in savings from her local account at Merrill Lynch. The action prompted a colleague of Jon Shubert, Martha’s financial planner, to file a suspicious activity report naming Case.

Unbeknownst to either court, Case had a years-long disciplinary record at her job at the Grand Traverse County’s Commission on Aging. Managers reprimanded her for bullying colleagues to tears, records in her personnel file show. Separately, Case’s paycheck had also been garnished in civil court — a legal recourse used to recoup money when a person has an unpaid debt.

Judge Nelson declined comment on Martha Rothaug’s guardianship. Jill Case also declined, saying, “the news has not done me justice in the past involving Jennifer Rodgers.” Rodgers is Martha Rothaug’s daughter, and much of Rothaug’s saga was first reported in the 2017 story “Fighting for Mom” in the Northern Express.

“The court thought Jill Case would be better to take care of my mother than her own daughter,” Rodgers told the Record-Eagle. “She loved the power.”

In Antrim County, the family of a 74-year-old man, Thomas Dobrzelewski, has been at odds with his former conservator concerning $23,000 they say hasn’t been accounted for following the sale of a portion of Thomas’ land. The family has filed paperwork with the probate court questioning expenses – including home repairs and shopping trips to Walmart — where his conservator spent thousands of dollars.

Dobrzelewski’s conservator, Vicki Hamlin-Rogers denied any wrongdoing, but has yet to show the family receipts, court records show.

When one of Dobrzelewski’s children took over their father’s conservatorship, the family found he had $1,475 to his name. When his wife died, Dobrzelewski did not have enough money to afford her headstone.

The Dobrzelewskis declined to comment on the case, but said they hoped their father’s guardianship saga could be instructive for fixing guardianship broadly.

“The current system provides easy opportunity for the exploitation of our most vulnerable population by the very courts and conservators and/or guardians charged with protecting them,” the family told the Record-Eagle in an emailed statement. “Many of the most vulnerable have no capability to challenge the fiduciary decisions and accountings made by conservators and/or guardians.”

Hamlin-Rogers is a professional guardian based in Emmet County. She has more than 20 wards between Emmet, Otsego, Charlevoix, Grand Traverse and Antrim probate courts. In Charlevoix, the Record-Eagle found Hamlin-Rogers had expensed $20,000 for “home repairs” in another conservatorship, not unlike some expenses flagged by the Dobrzelewskis in Antrim.

Charlevoix Court Probate Registrar Mary Clees said Judge Valerie K. Snyder – the same judge who appointed Elise Page to George Pappas – looks at every receipt meticulously, but that no public records exist detailing Hamlin-Rogers’ expenses.

Reached for comment, Hamlin-Rogers said that she had nothing to add to the Dobrzelewski case beyond the vacate order issued by the court. She did not reply to a question regarding her expenses on her Charlevoix conservatorship.

The family’s dispute was being mediated via the Antrim Probate Court, but has been paused pending the outcome of a referral of Hamlin-Rogers’ case to the Michigan State Police. Antrim County Prosecutor James Rossiter confirmed he is reviewing an MSP investigation into accusations of embezzlement passed to his office in October 2021 to determine whether to levy criminal charges in the case.

In cases where guardians or conservators run afoul of the law, making a victim whole again isn’t a sure thing.

Page, Pappas’ former conservator, was prosecuted for embezzlement, convicted and sentenced to pay $15,269 in court costs and restitution, plus spend 11 months in jail. She served five months, with the remainder held in abeyance, and is currently on probation. Page declined to comment for this story through her attorney, Jonathan Steffy.

Pappas will turn 97 in September and said he’s dissatisfied with how the court handled his case. He did receive a $2,500 check in the mail from a victim restitution fund, and Page is expected to get a job and pay back the money she owes to Pappas and to the court.

But probation documents state, for now, Page can pay court costs in monthly installments of $30.

At that rate, Pappas won’t be repaid until he’s 138 years old.

‘Putting blinders on’

Courtesy of Milton Mack Jr.
Months into his first term in office, Judge Milton Mack Jr. wanted to mend fences.

Mack was less than a year into his new job as state court administrator, a position which oversees every court in Michigan and is housed within the State Court Administrative Office.

A decade before his appointment, a Michigan Auditor General’s report cited numerous flaws in how probate judges monitored conservators. The auditors wrote that judges were “generally not effective” in monitoring conservatorships, and that SCAO should revisit how Michigan’s probate courts review annual accountings.

Mack said the probate judges bristled at the auditor’s conclusions, and at SCAO’s lack of support. He argued that law changes in 2001 altered the responsibilities of probate courts; before the code was changed judges were required to look at detailed receipts, afterward they were only to request detailed receipts if a complaint was raised about the conservators’ spending.

“The criticism was just factually wrong, and SCAO did not back us up in the beginning,” said Mack, who was the Chief Judge of Wayne County Probate Court at the time.

So Mack set out to rebuild trust between probate judges and SCAO.

Mack encouraged probate judges to begin influencing SCAO, allowing them to help pick regional administrators and have a say on guidelines regarding guardians, he said. The overarching focus was on strategies that were inexpensive and effective, building off the premise “that complicated doesn’t get stuff done,” Mack said.

One of those changes was to eliminate the requirement for local courts to tell his office about negligent guardians.

In a memo from July 2016, Mack told Michigan probate court officials they no longer needed to tell SCAO the names of conservators or guardians who fail to write in about their wards’ condition, or those whose annual financial accountings are deficient. Instead, the courts should just tell the SCAO how many cases were deficient. The changes, the memo explained, were done in the name of “streamlining.”

“When possible, SCAO reduces or eliminates reports to strike a better balance between reporting levels and effective oversight,” the memo states. “This month, SCAO streamlined the Deficiencies in Guardianship/Conservatorship Administration Report (SCAO 65) by eliminating Part B. Effective immediately, the report will no longer include a detailed list of deficiencies, with the case number, name of fiduciary, date, type, and court action for every deficiency over the past six months.”

A Record-Eagle reporter asked Mack why the state wouldn’t want to track the names of deficient guardians. Mack said his office didn’t need those names, that the reports created more paperwork, and that when they arrived at SCAO’s office in Lansing, they were being filed away in a cabinet.

“Having all those names doesn’t help SCAO do its job and it’s extra work for the courts that is nonproductive,” Mack said. “It would be like trying to find a needle in a haystack.”

Mack served at the head of SCAO until 2020, when he became State Court Administrator Emeritus – a position newly created for him. Mack said one of his roles is to advise the new Administrator Thomas Boyd, on issues like guardianship, where Mack has expertise.

One of Mack’s critics is Bradley Geller, former legal counsel to the Washtenaw County Probate Court and director of the Michigan Center for Law and Aging. Geller said Mack’s tenure at the SCAO weakened an already ineffective oversight apparatus.

Geller said state court officials have no idea how many professional guardians operate in Michigan, or how many wards some of these guardians have. He said the same “willful ignorance” guided the decision to curtail court reporting.

“In other words it’s like putting blinders on,” said Geller. “The less you know, the less obligation you have to actually administer the courts.That’s consistent with Milton Mack and it’s consistent with SCAO.”

Geller is a vocal and longtime critic of Michigan’s guardianship system. In 2017, Geller attempted to sue every probate court in the state in federal court. In his complaint, Geller wrote that judges and state agencies were failing to dismantle a “good old boys club” which was inappropriately institutionalizing vulnerable people to the advantage of lawyers, guardians and judges. Geller’s case was dismissed on a lack of subject matter jurisdiction.

Geller himself was terminated from his job as probate counsel at the Washtenaw County Probate Court in 2004. Geller said he was fired alongside a number of probate court staff by then-Supreme Court Chief Justice Maura Corrigan. The firings came in the wake of a state audit that detailed lax oversight of conservators by Washtenaw County Probate Court staff.

Mack said that his work didn’t weaken SCAO’s oversight and that his form is still effective without names. A better solution, Mack said, lies in a $175 million proposal to digitize and unify Michigan’s courts, a proposal that Mack put forth in 2018 but that has not moved since then. Shared record-keeping would allow SCAO to easily spot bad actors working across Michigan counties.

SCAO isn’t the only state office with oversight responsibility, however. The Michigan Attorney General also plays a role by appointing public administrators. Public administrators are guardians for entire counties who take the cases of wards who have no relatives. They also handle estates, and are supposed to distribute the remaining money in an estate according to a decedent’s will.

These administrators have come under public scrutiny, and even been fired, and yet some retain guardianships and conservatorships.

Attorney General Dana Nessel and former AG Bill Schuette terminated a handful of public administrators following media reports of questionable attorneys fees and assets not being turned over to rightful heirs. But despite being fired, the same former administrators retained an unknown number of guardianship and conservatorship cases.

Schuette in 2017 fired Oakland County public administrators Barbara Andruccioli and Jon Munger; former Macomb County public administrator Cecil St. Pierre resigned after being suspended. Nessel in 2019 fired administrators Jennifer Carney, Thomas Fraser and John Yun, also of Oakland County, as well as Robert Kirk, a public administrator in Macomb County.

John Munger has no active cases in Oakland County, but Jennifer Carney has 415 open or adjudicated cases, Thomas Fraser has 560 open or adjudicated cases and John Yun has 577 open or adjudicated cases, court records show.

An Oakland County Probate Court representative defined an adjudicated case as a case in which a judge has ruled, sometimes adding a co-guardian or discharging one guardian and replacing them with another, though the case may still come before the court for further rulings.

In many and perhaps even most of the above cases, Carney, Yun and Fraser may no longer have an active role, though data on the court’s website is inexact and all three are listed on the county’s Professional Guardian List.

Katharyn Barron, appointed in 2019 as Michigan’s public administrator, said she didn’t view this as a problem.

“Just because we removed them from their job as county public admin, that had nothing to do with their role as a guardian or conservator for individuals,” Barron said. “The court appoints them not because they’re the county public admin, but because they’re a private attorney.”

Andruccioli in 2018 was hired as Oakland County’s probate register and continues in that role today.

Meanwhile, there are also some 1,600 people under guardianship in Michigan with no immediate relatives. These cases all default to the Attorney General, who, by law, is the last person of interest in a case when there is no one else.

Under Nessel, it is Barron’s duty as state public administrator to blow the whistle on any questionable reports or annual accountings submitted by her wards’ guardians and conservators.

An unknown number of these are filed in undigitized courts across the state and are labor-intensive to track.

Barron is also the chair of Nessel’s Elder Abuse Task Force, where she coordinates a committee of more than 100 officials, lawyers, elder advocates and politicians, seeking to improve life for the state’s elderly.

Still, Barron said she checks on “each and every one” of these 1,600 cases, something she’s been able to accomplish with the help of remote court hearings, her office manager and a contracted law student.

Failures of reform

Elected Michigan officials have been trying to fix guardianship for decades, though each attempt has yielded little real change.

Murmurings of guardianship abuse in Michigan emerged in 1996. The Associated Press reported on the for-profit businesses of Alan May, a Wayne County professional guardian, and on guardians across the state with self-dealing arrangements between nursing homes and conservators.

Since then, elected officials established committee after committee to study the issue. For example, in 1996, the State Supreme Court convened a task force on guardianship reform. They produced 11 recommendations, including that “minimum ethical standards for professional guardians and professional conservators should be promulgated and enforced.”

Three years after those reforms were instituted, a 2003 report from the Office of the Auditor General showed problems in the probate courts. Auditors took a sampling of cases from Washtenaw, Wayne, Huron, Calhoun and Jackson counties. In one court, the auditors found 44 out of 114 annual accountings filed by conservators should not have been approved.

“For example, in 1 case a conservator reported annual expenditures of $37,198, but documented expenditures of only $27,717. In another case, a conservator reported nursing home expenditures of $15,558 but provided documentation supporting only $4,740,” the audit states.

In 2005, then-Governor Jennifer Granholm established another task force. This one also recommended minimum standards for guardians. The task force warned that “incidence of elder abuse is likely to rise significantly” over the next 20 years,” owing to Michigan’s aging population.

The recommendations led to no new legislation. When state auditors returned in 2012, they found the state court administrators had only complied with a few of the recommendations made in 2003.

Again, auditors recommended more oversight. And again, SCAO officials agreed.

The office would revamp its use of SCAO 65, officials promised, which would help probate courts identify conservators and guardians with “repeated deficiencies.”

This was the same form that, under the administration of Milton Mack, was “streamlined” to exclude names entirely – making it useless in terms of identifying specific bad actors.

In 2019, Attorney General Dana Nessel announced the creation of the latest Elder Abuse Task Force. Since its inception more than 100 members — judges, lawyers, guardians, advocates, accountants – have met monthly via Zoom. Reforming guardianships, conservatorships and court practices is one of the task force’s goals.

Chief among them was the idea that guardians should be certified — effectively licensed – by an agency such as Michigan’s Department of Licensing and Regulatory Affairs. LARA already oversees licenses of professions from nursing, medicine, child care and even barbers.

Reformers have urged lawmakers to pass a certification requirement since the 1990s, which would mandate education, training, background checks and insurance bonding for guardians and conservators.

Salli Pung, the state’s long-term care ombudsman, chairs the task force’s subcommittee on certification, something which is already a requirement in 14 U.S. states.

“If we’re going to require certification for a dog groomer, we should be requiring it for people who are responsible for every aspect of someone’s life,” Pung said.

Only two of Nessel’s task force’s many initiatives have so far been accomplished. Banks must now report fraud of vulnerable adults and there’s a new form for law enforcement to use when reporting that fraud.

The fate of the other seven — including certification – is tied to proposed legislation stalled in the House Judiciary Committee since June 2021.

Members of the task force said the proposed legislation has elicited objections from trade groups representing judges and guardians.

Judge John Tomlinson, president of the Probate Judges Association, said the initial package would slow the court’s ability to deal with emergent guardianship cases. “PJA couldn’t approve the first package of bills,” Tomlinson said.

The Michigan Guardianship Association also publicly opposed the package, including certification requirements that would require regular visits and limits on the number of wards a guardian can accept. The organization has spent $18,000 per year in lobbying expenses.

MGA representative Georgia Callis in March agreed to an interview with Record-Eagle reporters, canceled a scheduled interview, then stopped responding to requests to reschedule.

Guardians and judges have traditionally opposed oversight measures, such as capping how many wards can be assigned to one guardian.

If there’s money in a person’s estate, a guardian makes $83 per month, or about $1,000 per year. To make minimum wage, a professional guardian would need at least 20 wards.

Mack and Tomlinson said many shoot for 30 or more, on the assumption that some cases will be managed pro bono.

Judges have expressed concern over whether “capping” would leave thousands of vulnerable people in Michigan unguarded. According to Milton Mack, it’s very likely that the first wards to be dropped would be those being served pro-bono.

Mack said he was worried that, by regulating guardians, the new task force might actually end up leaving hundreds of vulnerable adults out to dry.

Legislation proposed by the task force is now in its third revision, and has been modified significantly.

If passed, the new law no longer would “cap” the number of wards a guardian can be appointed to serve, for example. Other changes have also been edited out of the initial bills, including requirements for guardians to personally visit their wards.

Several members of Granholm’s 2006 task force described their previous efforts as fruitless, in part because of pushback from guardians and judges.

“I don’t remember that there was a lot of change. I think I would have celebrated it if there was,” said Sharon L. Gire, a task force member and former director of Michigan’s Office of Services to the Aging.

“And there certainly were professionals in the field – attorneys who make a living – who were very concerned about not having too much control over what they do,” Gire said.

Barron vowed Nessel’s task force won’t have similarly insubstantial results.

“We’re not a task force that is going to write a report and then pat ourselves on the back and ride off into the sunset,” Barron said. “We’re not report-writers. We’re initiative accomplishers.”

Wayne County Prosecutor Kym Worthy, who was also on the 2006 task force, said she’s skeptical.

“That’s what they said the last time. That’s not what happened. The task force met, we had some very good discussion, it was a very comprehensive report, and then literally nothing happened,” said Worthy.

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