SEATTLE – Attorney General Rob McKenna today announced a settlement with Coranda Living Trust Services and its owner, Stephen Cuccia, Jr., in which the former Sumner resident agreed to provide refunds to Washington residents who purchased estate planning products. The agreement resolves allegations that Cuccia made misleading statements in order to sell living trusts and insurance annuities to at least 70 seniors.
“We believe that Stephen Cuccia represented himself as a certified estate planner and made misrepresentations about the probate process when convincing senior citizens to purchase living trusts and costly insurance products,” McKenna said. “Not only was Cuccia not licensed to sell insurance in Washington, he was ineligible because he had been convicted of insurance fraud involving senior citizens in California.”
Under the terms of the agreement filed June 13 in King County Superior Court, Coranda Living Trust Services and Stephen Cuccia, Jr., did not admit any wrongdoing but agreed to pay up to $60,000 in restitution to Washington consumers. The money will be distributed as refunds, with any remaining funds used to reimburse the state for attorneys’ fees and costs and converted to civil penalties. The defendants must also pay an additional $12,000 in state attorneys’ fees and costs and comply with injunctive provisions.
Cuccia was convicted in of selling securities without a license in California in 1999. He began doing business in Washington in January 2004 and formed Coranda Living Trust Services as a nonprofit business with an address in Sumner.
The Attorney General’s Office alleged that Cuccia arranged for a California company to create a living trust package that he marketed to consumers and contracted with another company to generate customer leads. According to the state’s complaint, Cuccia’s wife, Michelle, and others he knew obtained licenses to sell insurance in Washington and worked in conjunction with Cuccia.
Cuccia targeted seniors between the ages of 65 and 85 with incomes greater than $25,000 and visited them in their homes. The Attorney General’s Office accused Cuccia of representing that the probate process was extremely difficult and disadvantageous and that seniors could avoid these problems by buying a living trust. Seniors paid Cuccia $1,195 for the living trust. His wife notarized the financial documents.
Cuccia sometimes collected an additional $295 for an attorney, Richard Shepherd, who Cuccia said would review the documents. But the state’s investigation indicated that clients had already paid Cuccia before they had any contact with the attorney. The Washington Bar Association has ordered Shepherd to attend a hearing to determine whether a disciplinary sanction should be imposed.
The state also alleged that Cuccia recommended clients transfer all of their existing investments into the products he offered for sale and obtain reverse mortgages in order to purchase annuities from him.
Stephen and Michelle Cuccia now live in Idaho. The Washington State Office of the Insurance Commissioner investigated Michelle Cuccia and a colleague, Allison Neubert, for their sales of insurance policies on Stephen Cuccia’s behalf. The women turned in their licenses and will not be eligible to renew. The Insurance Commissioner is continuing its investigation of Richard Souza, another of Stephen Cuccia’s associates.
Although Cuccia is no longer doing business in Washington, the settlement prohibits him or anyone else involved with Coranda Living Trust Services from offering or selling living trusts or other estate planning documents here in the future unless those documents are sold by an attorney.
The Washington Legislature recently approved a law proposed by Attorney General McKenna to help protect seniors from trust mills. The law ensures that only individuals authorized to practice law can market living trusts or other estate distribution documents.
A revocable living trust – not to be confused with a living will – allows a person to control distribution of his or her estate by transferring ownership of property and assets into a trust. Properly drafted and executed, a living trust can avoid probate, the court-supervised process by which property is transferred to one’s heirs. A living trust isn’t a one-size-fits-all solution, however, and there may be other ways to avoid probate.
“Consumers should always seek independent advice from a qualified attorney when making decisions about estate planning,” McKenna said. “Senior citizens, especially, need to be cautious about inviting individuals into their home for estate planning appointments. This is a common tactic that deceptive salespeople use to obtain personal information about someone’s assets in order to sell investments and insurance products that may not be appropriate for their situation.”
McKenna thanked the Office of the Insurance Commissioner for its assistance in this investigation.
Consumer Refund Process
The Attorney General’s Office will send letters and claims forms to all seniors who purchased estate planning documents from Coranda Living Trust Services and Cuccia. The letters instruct those consumers who wish to receive a refund to submit claims forms to the Attorney General’s Office Consumer Protection Division. Payments will be sent in early September.
Coranda Living Trust Complaint
Coranda Living Trust Consent Decree
Media Contacts: Kristin Alexander, Seattle Media Relations Manager, (206) 464-6432
Shannon Smith, Assistant Attorney General, (206) 389-3996