Executor accused of stealing $170K of senior’s money was ‘like a kid in a candy store,’ family alleges

Despite a decade-long fight and a court judgment in their favour, a Manitoba family says they’re still looking for justice, alleging more than $170,000 of their 82-year-old aunt’s money was misappropriated by a woman they thought was her friend.

The family of Donna Manning, who died in 2015, accuses Kathleen Penner, 70, of abusing her power of attorney and her role as Donna’s executor to spend the senior’s money on plane tickets, jewelry and vacations, according to court documents.

“It makes you really not trust a lot, that somebody could do that to an elderly woman,” said Glenda Manning, Donna’s niece.

The family won a 2023 Manitoba Court of King’s Bench judgment against Penner, but says they’re still trying to have it enforced.

They say they’re speaking out about the case because they want to warn people to check in on their loved ones, and to call for better protection for seniors.

“Something has to be done about elders being taken advantage of,” Glenda said.

Penner, who works in the funeral industry, declined an October interview request, stating she was looking into hiring a lawyer. She did not respond to followup requests for comment.

In a 2021 affidavit filed in court, Penner wrote that she looked after Donna, and the two women were friends. Penner says any money she spent was because Donna wanted her to have it.

Family didn’t know senior was hospitalized

Donna Manning died at a Gimli, Man., hospital in May 2015 from an obstructed bowel. 

Her family members weren’t there, because they only learned later that she was in the hospital. 

The only person by her side was Penner — a woman the family knew as someone who drove Donna to medical appointments.

“She was in the hospital for three days and nobody knew,” said Kirk McCardle, Donna’s nephew.

In the days after, the family also learned Penner had, without their knowledge, been made executor of Donna’s will and had power of attorney on one of her bank accounts. 

“I was flabbergasted when I saw all of this,” said Glenda.

The family soon discovered a series of financial transactions that raised questions about Penner’s conduct in Donna’s final years and as executor of her estate. 

“It makes me feel terrible. Had any of us known that this was what was happening, we all would have been there,” said Glenda.

‘Don’t let her get away with it’

Donna’s will allocated half her estate to her brother Glen Manning, Glenda’s father, while McCardle, her nephew, and his sister would split the other half. 

The will said Penner would receive $5,000 from the estate but could seek “reasonable remuneration” over and above that amount as the executor.

Penner told the family that Donna died with no assets or savings beyond a condo valued at $119,000, personal items totalling $500 and less than $600 in her bank account, according to a legal document she signed in 2016.

But Glenda says that didn’t make sense, because her aunt was always very frugal with her money. A retired bookkeeper, Donna had a retirement fund and had also won $50,000 in a lottery in 2011, Glenda said.

“My aunt didn’t go anywhere. She didn’t drive,” she said. “She was very meticulous about things that she did.”

What the family didn’t realize is that the majority of Donna’s money had been spent in the last two years of her life by Penner, according to a 2021 affidavit filed in court by Glenda.

They also didn’t know nearly $100,000 was missing from the estate, because Penner did not disclose a $24,000 registered retirement investment account or an investment account with a credit union worth $70,000, according to the inventory of Donna’s estate signed by Penner.

In 2017, the family filed an application in Manitoba Court of King’s Bench to gain access to Donna’s accounts, hoping they could get answers about where Donna’s money went. 

They also wanted Penner removed as executor — a request eventually granted through a court order in 2021.

Glenda says she became more involved in the estate battle after her father died in 2018.

“His dying words were, ‘Don’t let her get away with it,'” she said.

Only about $3K left in bank

Through an earlier court order, the family gained access to various financial records that gave “rise to serious concerns” about how Penner was using money attached to Donna’s estate before and after she died, according to an affidavit sworn by Glenda on Dec. 3, 2020.

Penner was given power of attorney for Donna’s bank accounts with what was then Noventis Credit Union in August 2013, court records show. Monthly account records show after that happened, Donna’s spending went from $24,000 a year to over $96,000.

Money was spent at grocery stores and casinos, and on takeout food, ATM withdrawals and sports equipment, according to bank statements filed in court. 

The statements show multiple transfers were made into the Noventis chequing account during this period from Donna’s other accounts at another bank. That included transferring Donna’s $46,000 registered retirement income fund to Noventis.

The transfers totalled $186,000, which Penner now had access to due to her power of attorney.

“I spent hours and hours and hours going through bank statements and tracking one transfer to another bank account, to another bank account,” said Glenda.

By the time Donna died, there was just over $3,000 in her Noventis chequing account, and her registered retirement income fund went from $46,000 to $24,000 according to court documents. 

$70K payout ‘raises huge red flags’

The family also learned Penner and one of her neighbours, Penny McAdam, got a $70,000 payout from Donna’s account after her death.

Less than two years before Donna died, McAdam, who is a financial planner, had sold her two investments. Bank records filed in court show two cheques totalling $70,000 were made out to Desjardins, a personal finances company, from Donna’s Noventis account.

The cheques appeared to be written by someone other than Donna, Glenda alleged in court documents — they were written in all caps, while Donna’s cheques for things like Meals on Wheels were in cursive, Glenda wrote in a court affidavit.

When Donna died, Penner received $50,000 from one investment, while McAdam was the beneficiary of $20,000 from the other investment. They filled out a claimant form after Donna’s death, which asked if Donna had a will. They both checked off a box saying no, according to a Desjardins form filed in court.

A financial expert said that raises ethical concerns, because an investment representative should not be a beneficiary.

John Woodfield, a portfolio manager and certified financial planner based in British Columbia, said the fact McAdam sold investments to a person for whom her friend was an executor is “particularly egregious.”

“It raises huge red flags,” he said. “You have undue influence over that person.”

McAdam declined to comment on the investment, stating she cannot discuss any client information due to privacy reasons. 

Donna’s family say they have no idea who she is, and questioned in court documents why Penner never disclosed the investments. 

From 2013 to 2015, four cheques totalling $19,500 were written to Penner, the family alleges.

The family says they found more irregularities when they tracked the spending on Donna’s credit card. Donna did not carry a balance on her credit card, which had a limit of $1,500 in 2013, according to bank statements filed as court exhibits.

By the time she died in 2015, the credit card limit had been increased to $6,500 and it carried a balance of over $6,200.

The activity was “like a kid in a candy store,” said Glenda. “It was a transfer here, transfer there, withdrawals in Winnipeg, withdrawals in Selkirk.”

Penner was given access to Donna’s credit card account in August 2013 and was also given a card in her name connected to the account, according to court documents.

“She even had the gall to raise the [credit] limit six months after my aunt had passed on her Visa card,” said McCardle.

The card under Penner’s name was used for flights, hotels in the United States, and cash advances, according to account statements. Very few purchases were made with the card under Donna’s name, which often went unused for months.

After Donna’s death, Penner continued to use the credit card, the Noventis account and Donna’s vehicle, with more than $38,000 spent by Penner that had nothing to do with administering Donna’s estate, court documents say.

Penner “became executor because she knew that as executor, we wouldn’t have access to the bank accounts,” Glenda alleges.

“And it took us six years to get that access to find the proof.”

Friend and caregiver: Penner

In a sworn affidavit dated Jan. 13, 2021, Penner said she befriended Donna in 2003 and the pair enjoyed a mutual love of golf. She started taking Donna to medical appointments in 2008 and helped her prepare meals, the affidavit says.

Penner stated that by 2010, she had started to take on a more hands-on approach as Donna’s health deteriorated. That’s when Donna told Penner she was making her executor of her will, her affidavit says.

Penner said she did Donna’s laundry and cleaned her condo, and by 2014 was checking on Donna once or twice a day. 

But Glenda questions the support Penner gave Donna during her final years. The family says when they went to Donna’s home after her death, they found it stripped of her belongings and “covered in human and mice feces,” according to a sworn affidavit by Glenda in 2023.

Penner said in her affidavit she used the Visa credit card for two years after Donna died because “it never occurred to me not to use my Visa card, as it had my name on it.”

Thousands of dollars worth of charges made after Donna died were related to the estate, Penner said, including gas to travel back and forth to Donna’s place. 

Charges for golf equipment were for a donation Donna had asked her to make before her death, and food expenses were related to dinners where Donna was discussed, Penner wrote.

An estate lawyer CBC News spoke to said an executor can spend money from the estate after someone dies — but only if it is a fair and reasonable expense related to the administration of the estate.

“So if it’s buying groceries for themselves, it will not be reasonable. If it’s taking a trip to scatter ashes, that might be,” said Gerrit Theule, a wills and estate lawyer.

The job of an executor is to ensure any debts or tax bills owed by the deceased are paid, close their bank accounts, and dole out any money to beneficiaries, said Theule. The most common reason someone is removed from the role is failing to perform those duties.

The Manning family’s story illustrates why families should have open discussions with aging loved ones about their wishes so that there’s no confusion after their death, he said.

Seniors could also be vulnerable to manipulation or coercion, said Theule.

“There are many people that can have [mental] capacity who just have people in their lives who aren’t good for them.”

No-show at court hearings

Glenda and Kirk McCardle were named as the new executors of their aunt’s estate after Penner was removed under the June 2021 court order, giving them more access to her financial records.

The family filed a lawsuit against Penner in 2022, seeking damages for the money they alleged was misappropriated from the estate before and after Donna died.

Penner failed to appear in court to defend herself and did not produce documents requested by the judge during numerous hearings, according to statements made at a final hearing on Dec. 4, 2023.

Penner didn’t show up to that hearing either. 

The judge made a default judgment against her for over $240,000, including money owed to the estate along with punitive damages and interest. 

Despite the judgment, in order to recoup the money they are owed, the family has to figure out where Penner banks and serve garnishment papers to those financial institutions. Right now, about $800 is garnisheed from Penner’s wages and paid to the estate each month. 

But at that rate, it will take 25 years to repay — so the family wants a court to increase the monthly amount. 

Despite the ruling in their favour, the family learned earlier this year Penner will not face criminal charges for the alleged fraud. Police referred the case to the Crown, but prosecutors wouldn’t authorize charges.

“I am disappointed and angry,” said Glenda. “This makes no sense. There is a paper trail of proof.”