Checks & Imbalances

How the state's leading private fiduciary helped herself to the funds of the helpless

In July 1998, Commissioner Gary Donahoe set a hearing to learn why Elliston and attorney Larry Schafer had failed to obey his earlier order to file an estate management plan and annual guardian's report. (The paperwork already was five months late.) Just before the August 26 hearing, however, attorney Schafer finally filed the paperwork on Elliston's behalf. Not surprisingly, it didn't show the "loan" to Fiduciary Services.

Neither Elliston nor Schafer -- who didn't respond to a call from New Times -- got a slap on the wrist from Commissioner Donahoe for their tardiness in this case. To the contrary, Donahoe in early 1999 approved Elliston's bill of $8,180 for services rendered from March 1997 to February 1998. Schafer collected $1,104. (Fiduciary Services had earned $9,635 for its previous year's labors.)

Norah Brinkerhoff is now living in a skilled nursing home in Youngtown. In February, she had $199,000 left in her estate, almost all of it in a restricted account. Her finances and well-being are being overseen by Southwest Fiduciary.

Greg Maruda is one of many of Elliston's alleged victims.
Paolo Vescia
Greg Maruda is one of many of Elliston's alleged victims.

Born in 1896, Mazie Franklin moved to Mesa from her native Philadelphia in the 1940s, where she retired after a career as a grade-school teacher. She never married, and had no known survivors.

By 1977, Franklin was unable to care for herself, and a dear friend petitioned the Probate Court for help. A court-appointed psychologist noted in a report, "[Franklin] is suffering from a major mental illness, as a result of which she is gravely disabled."

That May, the court appointed Nancy Elliston to serve as Franklin's guardian/conservator. Franklin's estate at the time was about $21,000. Franklin eventually moved into a nursing home, where she died in 1987 at the age of 91. She left half of the $6,000 that remained in her modest estate to her friend -- who by then also had died -- and half to the Philadelphia Home for Incurables/Inglis House.

But court documents indicate that no one except Nancy Elliston would benefit by the remainder of the Franklin estate. (That money, by the way, doesn't include almost $7,000 in court-approved fees Elliston collected from the estate during the four years up to Franklin's 1987 death.)

Somehow, the Mazie Franklin case slipped through the proverbial cracks at Probate Court, as her court file shows no entries from 1988 until October 1999. But Elliston's woes caused authorities and others to revisit the files of even the least financially significant of her wards, including the Franklin Estate.

Court papers in the revitalized case show that Elliston moved $6,356 from Franklin's bank account into the "Nancy Elliston trust account" in August 1988, then drew $2,286 from that for a portion of her court-sanctioned fees. But, the documents add ominously, "the disposition of the balance of $4,070 . . . is unknown."

For certain, however, is that the Philadelphia Home for Incurables/Inglis House never got its share.

Kathleen Gannon's case made headlines in July 1987, after the deranged woman killed her aged parents at their Tempe home. In July 1989, a county judge acquitted Gannon of her mother's slaying by reason of insanity, but convicted her of murdering her father. She was sentenced to 25 years in prison, but spent almost five years at the Arizona State Hospital before authorities deemed her well enough to transfer her there. Nancy Elliston got connected with Kathy Gannon through a series of unusual legal circumstances.

Gannon's parents executed their will in March 1987, just four months before she killed them. They left equal shares of their estate to their four daughters, but asked that Kathleen's funds be placed in a "trust" because of her chronic mental problems.

The Gannon Estate totaled about $100,000, which left about $25,000 for each sibling. (Remarkably, Gannon circumvented Arizona's "Slayer Statute" -- which blocks murderers from inheriting the estates or insurance proceeds of their victims -- because she never was convicted of her mother's murder.)

Gannon's attorney suggested to Probate Court that the imprisoned woman needed someone to supervise the trust. Nancy Elliston got the job -- and power-of-attorney status over Gannon -- in August 1994. This case differs from that of others in this story in that a trust does not legally require annual accountings, nor any court supervision, for that matter.

Elliston opened a Bank One account totaling $22,300 on Gannon's behalf in late December 1994. Court records show Fiduciary Services regularly sent the prisoner small sums of money for sundries and other goods.

But it wasn't known until recently that, without alerting anyone, Elliston in July and August 1995 transferred $17,000 of Gannon's money into Fiduciary Services' own trust account. As was her custom, Elliston referred to the transactions in her own ledger as "loan(s) to Fiduciary Services." Two years elapsed before Elliston "repaid" the Gannon trust $1,200 in two checks, without interest, on the purported loan, leaving an unpaid balance of $15,800.

She continued to get away with the scheme, even as Gannon's bank account shriveled by the end of last year to almost zero. But in light of revelations in other Elliston cases, Judge Daughton asked the Public Fiduciary to examine the Gannon files, among many others.

Kathy Gannon may have caught a break in her otherwise gloomy existence. Attorneys involved in the Elliston matters say she's likely to get reimbursed for the thefts by the bonding company that insured her trust.

« Previous Page
Next Page »
My Voice Nation Help
Phoenix Concert Tickets