A complaint contends that while Regions Financial Corp. handled a charitable trust named for a former Alabama secretary of state, the bank charged exorbitant fees and directed scholarship funds to the children of trust board members.
Former Regions Financial Corp Chief Trust Officer John Bell, who retired last year, is named in a lawsuit filed on July 7 in Montgomery County Circuit Court.
The petition was submitted on behalf of their children by Megan Carmack and Leigh Gulley Manning.
The plaintiffs are relatives of Mabel Amos, who served as Secretary of State of Alabama from 1967 to 1975.
The lawsuit asserts that the board trustees benefited financially by utilizing Trust monies to send their children to expensive out-of-state institutions, despite not being in financial need, whilst members of Amos’ immediate family were in need.
The lawsuit seeks to remove Regions as the trustee bank and compel it to repay any payments made to the trustee children, in addition to compensatory and punitive penalties.
Amos submitted her last will and testament in February 1993, establishing a memorial trust in her name with Union Bank, which subsequently merged with Regions.
According to the lawsuit, Regions began collecting “outrageous” fees when oil was discovered on Amos’ property, as opposed to “fair” fees when natural gas wells were present. In 2010, the lawsuit alleges, Regions was compensated approximately $7,000 for five hours per week of trust administration.
The same five hours per week cost $92,736 over one year.
The lawsuit asserts that the trust paid Regions more than $1 million in management fees between 2002 and 2018.
In addition, the wells have produced between $70 million and $80 million worth of oil and gas, or approximately 100 barrels of oil each day, in addition to millions of cubic feet of natural gas.
Simultaneously, both the quantity and value of scholarships grew, from $21,794 over five awards in 2011 to $240,000 across 17 awards in 2013.
Among them were alleged “thousands of dollars in scholarships” for the children of two attorney trustees who did not attend institutions in Alabama, which was not Amos’ intention when he created the trust.
In addition, the suit alleges that Manning’s daughter earned around $72,000 in scholarship funds from the trust over 11 years, from elementary school to college, although the trust awarded three times that amount to the children of trustees in a single year.
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The children of Alabama Ethics Commission Executive Director Tom Albritton reportedly received $120,000 from the trust to attend the University of Texas.
In addition, the plaintiffs allege that the Regions’ trust officer concealed the fees charged by Regions and engaged in “self-dealing.”
Jennifer Elmore, vice president of corporate communications and public relations for Regions, declined to comment on the lawsuit directly.
In addition to compensatory and punitive penalties, the lawsuit seeks to remove Regions as the trustee bank and compel it to repay any payments made to the trustee children. It was Emphasized as a priority.
