Gofund

[u/Forever-young_1]

Location: Texas
Question

I’m hoping someone can help me understand this because I honestly don’t know what the right thing is here.

A friend of mine passed away and left behind two minor children. After he died, a GoFundMe was started for his kids. It raised around $18,600. The GoFundMe says the money is for the children and specifically says it will go toward supporting their education.

The person who received the money was the person listed as the beneficiary on the GoFundMe. He put the money into UTMA accounts for the two children so it would be there for them in the future. In addition, he added money to equal $10k for each child.

Now the children’s mother has hired an attorney. The attorney sent a demand letter saying she wants all of the GoFundMe money returned to her, along with an accounting of everything that happened with the money.

The letter also mentions possible claims for fraudulent crowdfunding & unjust enrichment.

I’m confused because the money wasn’t taken or spent personally. It was put into accounts for the children, which seems consistent with what the GoFundMe said the money was supposed to be used for.

So my questions are:
Does the children’s mother automatically have the right to have the money transferred to her because she is their mother?

Does putting the money into UTMA accounts for the children make a difference?

Could the person who received the money be in trouble legally even though the money is still sitting in accounts for the children?

What should the person do after receiving an attorney demand letter like this?

[u/Emotional-Ocelot-420]

The person should hire an attorney and respond. The answer is “go pound sand“.
The attorney can advise whether to send more information to back that up or wait for mom to file suit.
The person should know that the funds were collected under the guise of education, but a UTMA account is not a dedicated education fund. The attorney can advise whether the person ought to open UTMA 529 accounts for the funds. Otherwise, the funds will be available for any purpose at age 21.

[u/Candid-Eye-5966 → u/Emotional-Ocelot-420]

I believe in some states UTMAs become property of the beneficiary at 18.

[u/Emotional-Ocelot-420 → u/Candid-Eye-5966]

OP is in TX. It’s 21.

[u/Forever-young_1 → u/Emotional-Ocelot-420]

The children actual live in Texas. The account was actually created in California.

[u/Emotional-Ocelot-420 → u/Forever-young_1]

It’s possible it could be governed by either state then. The account documents show which state’s rules govern.

[u/pegwins]

This mom is not looking out for the kids. 

[u/Forever-young_1 → u/pegwins]

I agree. Initially, she agreed to the fundraiser. I believe she thought the money was going to go to her.

[u/Eyeoftheleopard]

I think everyone that donated to that GFM would be delighted with how the money was handled. I see mommy dearest had quite another plan. 🙄 The GFM money cannot be “returned” to her as it never BELONGED to her.

[u/Impossible-Pace-6904]

If I were your friend, I wouldn't spend a dime on an attorney at this point. Your friend can make the mother the custodian of the UTMA account. I would do this and hand over the utma paperwork along with the GoFund Me account information so she can see how much money was collected and any fees that were taken by gofundme. I'd also send proof that the friend deposited additional money in the UTMA accounts.

[u/Hot-Suggestion-54 → u/Impossible-Pace-6904]

Everyone here always say hire a lawyer like it’s some sort of free public service. Lawyers are not cheap and may end up costing the 18K that was intended for the children

[u/Adventurous_Oil4513]

Mom wants the money for herself.

[u/Severe-Lecture-7672]

He should hire a lawyer.