By Monica Alonzo
By Stephen Lemons
By Jason P. Woodbury
By Dulce Paloma Baltazar Pedraza
By Ray Stern
By Pete Kotz
By Monica Alonzo
By New Times
The reputation of Arizona's private fiduciary industry has taken another blow, with revelations that Andrea McShane mishandled several of her clients' assets before splitting for parts unknown.
Whether McShane engaged in thievery or simply was derelict in her duties as fiduciary remains uncertain, as attorneys and others continue to sift through cases over which she held sway as financial conservator. What is certain is that, until recently, the Phoenix woman controlled more than 86 estates and trusts totaling several million dollars.
"We just don't know yet what we have," says Paul Blunt, a veteran probate attorney now representing some of the individuals and estates in question.
"A review of the various cases, asset information, court docket, etc., indicates that most of the estates have been substantially mismanaged . . ." two Phoenix attorneys wrote to Judge Donald Daughton in court papers filed September 15.
Two Maricopa County jurists, Daughton and Gary Donahoe, have issued civil bench warrants for McShane's arrest, but she has vanished, according to documents and evidence presented at a late-September court hearing. Phoenix police on August 2 escorted attorney John Barron and private fiduciary Peter Frenette into McShane's home in Phoenix. From a court document filed September 15 by Barron and Alisa Gray:
"No one was prepared for what was found upon entry. To the shock, horror and dismay of those present, the residence was wholly uninhabitable. Court and financial documents were strewn about with food debris, cat feces and other mail. The debris covered the entire living quarters of the residence to a depth of approximately 2 feet."
McShane's business, known as Guardianship Services Incorporated and Arizona Estate Administration, apparently has been inactive for months, though she retained fiscal control over many of her clients' cases until a few weeks ago.
McShane had been one of the Valley's most prominent private fiduciaries for more than 15 years, serving as conservator for incapacitated adults and children with no family or friends to care for them properly. Judges and commissioners appointed her to cases until early last year, and her reputation around Probate Court generally was sound.
(New Times wrote earlier this year of another private fiduciary, Glendale resident Nancy Elliston -- "Nancy Drew," Paul Rubin, January 24 -- who pillaged the estates of vulnerable adults that the Probate Court judiciary had entrusted to her. Elliston subsequently was indicted on numerous felony theft and racketeering charges and is awaiting trial.)
In mid-1999, according to court documents, McShane asked Frenette, president of the Gilbert-based Sun Valley Group, if he wanted to take over as fiduciary in some of her cases. Despite repeated requests, however, Frenette couldn't get McShane to provide the client files, even after Probate Court jurists ordered her to produce them earlier this year.
By early July, Frenette's attorneys wrote, "[McShane] had not made any efforts to provide the necessary information. Not only was this information vital for proper administration of financial matters, but the failure to produce it also hampered Sun Valley's ability to provide health and medical assistance to various wards. . . . Several elderly or incapacitated persons had not been visited by McShane for many months, and [their] basic living needs were not being met."
During the August 2 search of McShane's home, authorities also found an urn of cremated remains, thousands of dollars in uncashed checks, jewelry and other personal items belonging to several estates, "as well as securities and accounts that had never been reported on any accountings or inventories produced by McShane."
On August 5, the team reentered McShane's abandoned residence, this time equipped with gloves, masks and protective clothing. They confiscated hundreds of pages of documents to sort through later, court documents note, in "an air-conditioned warehouse."
Those at the search also coaxed McShane's malnourished cat to come to them. A receptionist at attorney John Barron's office nursed the cat for a few days, after which Barron delivered it to McShane's daughter. She agreed to take the cat, but declined to reveal her mother's whereabouts. Authorities earlier had deposited fish into McShane's filthy swimming pool, after neighbors complained it had become a breeding ground for mosquitoes.
McShane's neighbors also told the search team they'd earlier seen banker's boxes "stacked so high in the garage that no one could see past them. [They] reported that the boxes had been removed four to eight weeks prior to [the] entry."
Barron says neither he nor his clients, Sun Valley, know what was in the boxes, or where they are.
The ramifications of McShane's alleged transgressions are only starting to come to light. In one case, for example, a Phoenix attorney had to pay a month's worth of bills out of his pocket for a mentally handicapped Valley man whose trust fund McShane was being paid to oversee. Says the attorney, Dick Whitney, "She just stopped paying his bills. He told me he was going to be evicted from his place and didn't know what to do. I'm not sure what happened to Andrea -- maybe things became too much for her to handle."
At the recent court hearing, Judge Daughton said he wants the Sun Valley Group to be bonded by an insurance company in the cases it's taken over from McShane. A straight-talking sort, the judge said Peter Frenette has earned a reputation for being honest and competent, but added, "If he (Frenette) goes south with a million bucks, we're all going to look silly."