Audit Report on Estate Asset Identification and Management Practices of the Richmond County Public Administrator’s Office

Audit Impact

Summary of Findings

The audit found that the Richmond County Public Administrator’s Office (RCPA) generally conducted research to appropriately identify decedents’ assets. However, the auditors found multiple instances where RCPA did not properly oversee the administration of the estates or act in the best interests of decedents’ estates and, because of this, assets may be at risk. Additionally, RCPA has not developed a written manual outlining its internal procedures, as required by Article 11 of the New York State Surrogate’s Court Procedure Act.

Intended Benefits

This audit identified the need for improvement in RCPA’s operation in identifying and safeguarding decedents’ assets and maintaining accurate estate records.

Introduction

Background

Each borough of New York City has one Public Administrator (PA) appointed by the judge or judges of the Surrogate’s Court of their respective county. The PAs are responsible for administering the estates of individuals who die intestate (without a will) or with no heirs willing or able to administer the estate. RCPA administers such estates in Richmond County, which encompasses all of Staten Island.

RCPA is managed by the PA and a Deputy PA; the current incumbents were appointed in 2019.[1] The official duties of the PAs are governed principally by Article 11 of the New York State Surrogate’s Court Procedure Act (SCPA), Guidelines for the Operations of the Offices of the Public Administrators of New York State (NYS PA Guidelines), and reporting requirements established by New York City Comptroller’s Directives. RCPA does not have its own procedures manual.

As the estate administrator, RCPA has a fiduciary duty to the estate that requires conducting thorough investigations to discover and account for all assets; identifying and safeguarding all assets; paying decedents’ debts and taxes; accounting for and maintaining documentation to support estate activities and transactions; and distributing estate proceeds to decedents’ heirs.

RCPA’s operations are funded by the City of New York and by estate commissions. The City mainly funds the office’s salaries and other than personal services (e.g., supplies, some contracts, utilities). The amount of estate commission is fixed by statute (SCPA Sections 1106 and 2307). These commissions are calculated on a sliding scale based on the assets of the estate, starting at 5% of the first $100,000 and going down to 2% of any assets over $5 million. These commissions are supposed to be distributed to the City’s General Fund (Department of Finance). RCPA also receives an additional 1% of the gross assets of each estate, which is supposed to be maintained in a suspense account (separate bank account) and should be used for necessary expenses of the office that are not covered by City funds.[2] The suspense account can also be used to loan money to the estates for various expenses (e.g., filing fees, death certificates, funerals) to be reimbursed when the estate assets are collected.

One critical component of RCPA’s responsibility is to identify, collect, inventory, and manage or oversee the sale of real and personal property that belongs to the decedents’ estates it administers. RCPA initiates a property search upon notification by hospitals, nursing homes, or medical examiner’s offices regarding a decedent with no known family or beneficiaries. The property search at the decedent’s residence must be conducted by a minimum of two RCPA employees if staffing allows, with subsequent searches performed if necessary.

During the initial search, RCPA officials document the condition of the residence and the decedent’s belongings with videos and photographs, which are to be maintained at the RCPA office, along with an Initial Entry of Premises Report (Initial Entry Report). The Initial Entry Report, which is required to be signed by the two RCPA officials who conducted the search, includes the decedent’s personal information as well as the initial search information—the date of entry, people who entered the residence, the premise’s address, and a breakdown of contents by room and area.

Cash and easily transportable items found at the decedent’s residence, including fine jewelry, sentimental items, and identification documents, are removed by RCPA officials and transported to the RCPA office, which has two lockable cabinets to store items that are meant to pass to the decedents’ heirs, as well as a safe to keep cash prior to depositing it in the bank. RCPA retains large items, such as furniture, pictures, and electrical appliances, at the decedent’s residence prior to estate sales, which are administered by a third-party vendor and overseen by RCPA.

RCPA conducts additional research by sending letters to financial institutions (e.g., banks, pension systems, insurance companies) and searching the New York State Unclaimed Funds database and LexisNexis research engine to identify additional assets that may not be included during the property searches.

RCPA uses QuickBooks accounting software as its case management system to maintain an accounting record of each estate’s financial transactions and assets and to support and manage other aspects of estate administration. RCPA also separately maintains hard copy files for all active estate cases and keeps closed estate case files at the office or in the basement storage room before archiving them.[3]

As of August 14, 2023, RCPA reported a total of 232 open estates with assets totaling approximately $41 million in value. Of these, 58 cases have an account balance over $50,000, and 174 cases have an account balance under $50,000. RCPA employs five full-time staff, including the PA and Deputy PA.

Objectives

The objectives of the audit were to determine whether RCPA (1) conducted proper research to identify decedents’ assets, and (2) accurately accounted for and properly safeguarded estate assets.

Discussion of Audit Results with RCPA

The matters covered in this report were discussed with RCPA officials during and at the conclusion of this audit. An Exit Conference Summary was sent to RCPA and discussed with RCPA officials at an exit conference held on August 7, 2024.  On November 6, 2024, we submitted a Draft Report to RCPA with a request for written comments. We received a written response from RCPA on November 21, 2024. In its response, RCPA agreed with five recommendations, partially agreed with three recommendations, and disagreed with the remaining two.

RCPA’s written response has been fully considered and, where relevant, changes and comments have been added to the report.

The full text of RCPA’s is included as an addendum to this report.

Detailed Findings

RCPA generally conducted adequate research to appropriately identify decedents’ assets. However, the auditors found multiple instances where RCPA did not properly administer or act in the best interests of estates, which may put assets at risk of loss and theft.

Specifically, the audit found that RCPA did not thoroughly document searches of residences. Photos and videos taken by investigators captured the conditions and layouts of premises but not the actual searches. Additionally, RCPA did not document its efforts to identify additional assets and property, such as detailed inventory records to account for all items of value and bank accounts.

The audit also found deficiencies in RCPA’s administration of estates. RCPA did not adequately protect estate bank accounts that exceeded the FDIC-insured limit, which is required to prevent loss in the event of bank failures.

Regarding asset sales, the audit found that RCPA did not ensure the third-party vendor that oversaw the process safeguarded sale proceeds, maintained separate inventories for each estate, and documented the outcome of each sale—including whether items were sold and for how much. The duties, scope of work, and payment terms of the contractor used by RCPA to conduct auctions and other asset sales were not documented in writing prior to the service being rendered.

The audit also found minor recordkeeping issues, including assets not always recorded in a timely manner and supporting documentation for estate-related payments not being consistently maintained.

Finally, RCPA did not establish written procedures to ensure adequate internal controls, including the appropriate segregation of duties and how staff and others should safeguard valuable estate assets.

These issues occurred primarily because RCPA staff did not follow the NYS PA Guidelines or the Comptroller’s Directives.

These issues are discussed in more detail below.

RCPA Does Not Adequately Document Search Results or Safeguard Decedents’ Personal Property

Missing or Insufficient Documentation of Searches and Assets Found

RCPA did not consistently maintain sufficient records to fully document property searches and the identification of decedents’ assets. NYS PA Guidelines states that the “employee(s) shall, to the extent feasible, thoroughly search each residence and document the contents and condition of the residence by photograph or video recording.” Additionally, the guidelines state that employees “shall, contemporaneous with the search of the residence or immediately thereafter, make a complete and detailed report of the search” and require that “[t]he report and inventory shall be signed by the employee(s) and any other witness to the search.”[4]

While RCPA provided videos and photographs taken during initial residence searches for 22 cases, only 14 of those had Initial Entry Reports. Several issues were noted with these reports: two had no entry date, one lacked the required signatures, and two did not include a description or comment regarding the search.[5]

Although RCPA recorded initial searches on video and in photographs, the videos (ranging from two to eight minutes in length) primarily captured the condition and layout of the residence, rather than the actual search process. Similarly, most of the photographs focused on the original condition of the premises but did not provide detailed information about any items of value identified during the search. Proper documentation of the initial searches is a necessary control to help mitigate the inherent risks of theft and misconduct during and after such searches.

Auditors also observed that RCPA does not maintain a log to record the required information on subsequent searches or visits, as outlined in NYS PA Guidelines, which states that the “PA shall maintain a log reflecting every visit to the decedent’s residence, the individuals who entered the residence and reason for entry.”[6] Other than the digital records and the Initial Search Reports recorded on the day of the initial search, RCPA did not provide additional documentation related to subsequent searches for the 22 cases reviewed by the auditors.

The auditors found that 48 of the 67 estate case files did not include correspondence between RCPA and financial institutions regarding searches for decedents’ other bank accounts. Because this documentation is missing, it is unclear whether RCPA identified or collected additional assets. These gaps in documentation and missing records increase the risk of theft and signal the need for better oversight.

Detailed Inventory Records of Estates Not Established

According to NYS PA Guidelines, case management systems should provide “an individual inventory of each item of real and personal property of saleable value relating to each estate, and the location of such assets.”[7] However, RCPA did not maintain detailed inventory records for each estate in QuickBooks. In addition, Comptroller’s Directive 1, Principles of Internal Control, §5.5, advises that physical controls, such as periodic inventory counts and accurate inventory lists, must be established to “secure and safeguard vulnerable assets.” The directive also highlights the importance of “periodic counting and comparison to control records” as key elements for ensuring asset security.

By not adhering to both these guidelines and internal control principles, RCPA may compromise the security and accountability of estate assets. Furthermore, neither RCPA nor its third-party contractor, Victorian Brothers, maintained records from their searches (e.g., photographs, handwritten notes) listing the items of value identified and retrieved from most of the decedents’ residences. During an interview with RCPA officials, the audit team confirmed that detailed records of such valuable items are not prepared or maintained by RCPA or Victorian Brothers.

Without a detailed inventory record, it becomes difficult for RCPA and the auditors to determine whether all items were properly retrieved and disposed of. The absence of detailed inventory records increases the risk of errors and can lead to potential disputes over asset management.

10 Estate Bank Accounts Exceeding FDIC-Insured Amount Not Collateralized

The Federal Deposit Insurance Corporation (FDIC) insures up to $250,000 of a depositor’s account if a bank fails. If an estate’s funds exceed this limit, the NYS PA Guidelines requires PAs to either spread funds between separate accounts at different banks or secure collateral in the form of government securities for amounts not covered by the FDIC.[8]

Auditors reviewed 18 of 232 active cases with assets exceeding the FDIC limit of $250,000 and found that 10 bank accounts belonging to eight estates did not have documentation showing that the deposited amounts were secured by appropriate collateral. After discussing this issue with RCPA officials, estate funds for three of the eight estates were transferred into different banks. RCPA is currently in the process of coordinating with the associated banks to address the remaining accounts.

Without these precautions, estate funds could be exposed to potential risk if a bank failure were to occur.

RCPA Does Not Adequately Oversee Vendor’s Administration of Estate Sales and Auctions

Assets Selection for Estate Sales or Auctions Was Not Handled by RCPA Officials

RCPA delegates its responsibility for selecting personal property that can be sold or auctioned to Victorian Brothers, an outside vendor. This approach does not align with the NYS PA Guidelines which states that the “PA shall be responsible for selecting the property to be auctioned and may not leave this decision to the discretion of the auctioneer.”[9] Although RCPA supervises estate sales, Victorian Brothers decides which items are selected for estate sales or auction. When this was discussed with RCPA officials, they stated that RCPA staff lack the expertise to determine the value of items. However, by relinquishing control over property selection, RCPA may face challenges in ensuring that contractors organize sales with the estates’ best interests in mind or guard against misappropriation of assets.

Inadequate Controls Over Estate Assets Sold or Disposed of by Vendor

According to NYS PA Guidelines, the PA “should require that the auctioneer or someone acting on his behalf reconcile items sold or left unsold at auction to estate property inventory records to ensure that all the items are accounted for.” For each auctioned item, the PA is required to record the sale price, the name and address of the purchaser, and the estate to which proceeds should be credited, and other information.[10] However, neither RCPA nor Victorian Brothers fully followed these guidelines.

After retrieving valuable items from decedents’ residences, Victorian Brothers consigned the more valuable items (such as gold/silver coins and fine jewelry) to an auction house located in Maryland, which conducted periodic auctions. After each auction concluded, Victorian Brothers provided RCPA with an invoice and a comprehensive list of the items sold, including photographs and sale prices received from the auction house. However, there were no records listing the consigned items, by each estate, that were sent to the auction house, and reconciliation of the sold items was not prepared by either Victorian Brothers or the auction house.

Victorian Brothers also administers estate sales to sell other personal property, such as electronic devices, furniture, and clothing. Each estate sale may contain items from more than one estate. Following each estate sale, Victorian Brothers sends RCPA an invoice for each estate detailing the commission charged and other related expenses, accompanied by a check for the net proceeds. The invoice specifies the estate to which proceeds should be credited but does not provide detailed information, such as the description of the items sold, the price of each item, and the purchaser’s information.

On October 1, 2023, during an observation of an estate sale, Victorian Brothers’ staff informed the auditors that they did not record the items before, during, or after the estate sale due to the large number of items at each sale. This increases the likelihood of inaccuracies and potential loss of estate assets. Additionally, although items were organized in categories and separated into different sections based on the estate they came from, there were no price tags for sale items, and sale prices were determined by Victorian Brothers at the point of inquiry. This lack of detailed recordkeeping makes it difficult to verify the accuracy of Victorian Brothers’ invoices for each estate sale.

It is also concerning that Victorian Brothers did not use a cash register or other mechanism to record each sale, even though cash is the preferred method of payment.[11] Instead, all proceeds were handed to the owner of Victorian Brothers at the end of the estate sale without being counted or separated by estate.

RCPA officials indicated in response to this finding that they have a good relationship with Victorian Brothers. Nevertheless, the absence of detailed inventory and sales records increases the risk that valuable items and sales proceeds may not be properly accounted for.

No Written Agreement with Vendor Specifying Terms of Service

NYS PA Guidelines requires that payments made to outside vendors be supported by written agreements or invoices specifying terms of service.[12] RCPA has been working with Victorian Brothers to organize estate sales and auctions for many years without a formal solicitation process or written agreement.

Given the absence of a standing retainer and a transparent solicitation process, the auditors could not determine whether the invoiced amounts were correct, fair, and reasonable. Auditors did, however, identify inconsistencies in commissions charged by Victorian Brothers. For instance, based on records the auditors reviewed, Victorian Brothers charged 25% commission for estate sales, 10% commission for vehicle sales, and 15% commission on top of the auction house’s 5% to 50% commission when items were disposed of by auction.[13] Additionally, auditors were unable to determine whether service charges for other related services (such as cleanup fees) were reasonable and appropriate due to insufficient information on the invoices, such as the number of service hours and hourly rates.

Without a written agreement with vendors stating clear terms and conditions, RCPA may be exposing itself to potential disputes over commissions as well as financial risks. This also makes it challenging for auditors to confirm whether the fees and commissions charged were reasonable and justified.

Minor Issues Found in Recordkeeping Practices

NYS PA Guidelines requires RCPA to record all estate activities promptly in its case management system.[14] The system should summarize all receipts and disbursements for each estate. RCPA records all estate assets, including decedents’ bank accounts, real properties, and other assets in QuickBooks. A Certified Public Accountant (CPA) conducts monthly bank reconciliations for the individual estate accounts managed by RCPA, ensuring accuracy. RCPA then updates the account balance, status, and description accordingly in QuickBooks.

According to RCPA officials, RCPA redirects all decedents’ mail to its office after initial property searches, which allows officials to gain further insight into decedents’ banking and investment information. RCPA then contacts financial institutions to close decedents’ accounts and open estate accounts.

A review of the estate folders and QuickBooks records found that RCPA generally recorded the estates’ incomes and disbursements accurately, with the exception of the instances listed below.

Specifically, auditors found:

• One case that was closed in 2018 and subsequently reopened after $13,096 in cash and other documentation were retrieved from a safe deposit box in June 2022. However, the case was not officially recorded as reopened, and the cash—despite being maintained in the safe in RCPA’s office for over a year—had not been deposited in a bank account or recorded in QuickBooks, as of August 14, 2023.^[15]
• One case in which a decedent’s investment account—with a value of $61,369 as of March 31, 2022—was not included in the decedent’s estate records until February 21, 2024, almost two years later. An RCPA official explained that this particular delay reflects efforts to obtain the necessary paperwork to liquidate the asset, which required several phone calls to a bank.
• One case that was closed in 2019 appeared as an active case in QuickBooks as of August 14, 2023.[16] The inaccurate accounting may result in missing assets or inaccurate financial reporting.
• Four QuickBooks payment transactions for three estates lacked documentation to clarify the nature of the transactions.[17] NYS PA Guidelines requires PAs to “maintain a file for each estate containing all documents relating thereto, including but not limited to […] receipts, invoices, and proof of payment of estate disbursement.”[18]
• RCPA used its suspense account to cover a payment of $900 for an estate that was mistakenly referenced to another estate on the check issued to the payee.[19] According to NYS PA Guidelines, PAs are required to maintain accurate records of all suspense account activity.[20] Referencing payments to the wrong account may lead to inaccuracies in financial records.

Strengthening recordkeeping practices and ensuring proper account references would help improve the accuracy and transparency of financial reporting.

RCPA Does Not Have an Internal Policy Governing Its Estate Administration Practices

RCPA has stated that the NYS PA Guidelines is the sole official document it follows in the administration of decedents’ properties. However, those same guidelines require RCPA to adopt its own written procedures for safeguarding valuables and a written plan to ensure the adequate segregation of duties. As of August 7, 2024, RCPA had not yet developed these written policies. The lack of formalized procedures may lead to inconsistent practices within the agency, potentially creating uncertainty among staff about which procedures and protocols to follow in various situations.

Recommendations

To address the abovementioned findings, the auditors propose that RCPA should:

Improve its oversight over the collection and safeguarding of decedents’ assets:

1. Maintain sufficient and complete records documenting each residence search to accurately identify decedents’ assets, such as:
   1. Initial Entry Reports with information properly filled in and signed by the required RCPA and other personnel;
   2. Video that captures all essential activities of the search process and photographs that document the valuable items identified during the searches;
   3. A detailed inventory list for each estate following the property search to correctly document all assets; and
   4. A log to document every visit to a decedent’s residence, the individuals who entered the residence, and the reason for the entry.

RCPA Response: RCPA partially agreed with this recommendation, stating that the office is now equipped with a camera tripod to capture uninterrupted video of the entire search and that photographs will be detailed enough to meet inventory requirements going forward. RCPA has also implemented a log to document subsequent visits of a decedent’s residences.   

However, RCPA states that it is not feasible to handwrite every item found in the residence on the Initial Entry Report due to its staffing limitations. RCPA also contends that Victorian Brothers takes photographs of the items procured and sold.

Auditor Comment: Staffing limitations should not compromise accuracy or completeness of the process. RCPA’s efforts to improve the quality of photographs are a positive step, but they do not fully address the need for a detailed written inventory, which remains a fundamental requirement for estate administration. A comprehensive inventory list paired with a properly filled out/signed Initial Entry Report would ensure clarity, accuracy, and accountability for all residence searches.

2. Ensure letters are sent to local financial institutions to identify decedents’ bank and investment accounts and that correspondence received from financial institutions is maintained in case folders.

RCPA Response: RCPA partially agreed with this recommendation, stating that many of the estates involved limited administration appointments, citations, foreclosures, or situations where the family took over, making additional asset searches unnecessary. RCPA committed to including a standard memo in such estate files moving forward, explaining why further research is not required.

Auditor Comment: RCPA’s plan to include a standard memo is a step forward and will increase transparency and accountability. However, lack of documentation for any asset searches, limited or otherwise, raises concerns over whether searches are being properly conducted.

3. Ensure that estate funds held in FDIC-insured accounts do not exceed the FDIC limit or ensure that the accounts are properly collateralized with approved government securities.

RCPA Response: RCPA agreed with this recommendation.

Improve its oversight over vendor estate sales:

4. Select estate assets to be sold at estate sales and auctions rather than delegating such decisions to third-party vendors (in this case, Victorian Brothers).

RCPA Response: RCPA disagreed with this recommendation, stating that it “gives final approval on what items are removed from an estate. However, we do defer to professionals on what items will yield a return for the estate.”

Auditor Comment: RCPA’s claim that it gives final approval lacks clarity and verifiable evidence. There is no documentation, such as meeting minutes, decision logs, or other communication, to confirm that RCPA actively participated in or made final decisions regarding the disposition of estate assets.

5. Require Victorian Brothers to improve its accountability of estate sales and auctioned items by:
   1. Maintaining a list of valuable items, by estate, before sending to the auction house or conducting the estate sale;
   2. Listing the sales price of each item;
   3. Maintaining records for each item sold and the name of the purchasers;
   4. Using a cash register to safeguard sales proceeds;
   5. Reconciling the inventory and the sold items with the remaining inventory; and
   6. Providing detailed invoices listing the items sold or services rendered when requesting payments from RCPA.

RCPA Response: RCPA disagreed with this recommendation, stating that maintaining detailed records is not feasible due to the high volume of items sold per estate and the limitations of their small staff and auction vendors. They claim that such recordkeeping would be overly time-consuming and impractical, asserting that their current, less detailed methods effectively maximize estate value.

Auditor Comment: RCPA cites the impracticality of detailed recordkeeping. However, its response only partially addresses the recommendation and does not resolve the central issue of accountability. This recommendation focuses on implementing basic, streamlined accountability measures that ensure transparency and safeguard estate assets without placing an undue burden on staff or vendors.

6. Implement a solicitation process for selecting estate sales and auction vendor(s) to ensure vendor selection is transparent, and enter into a formal written agreement with selected vendor(s) to clearly establish terms and conditions underpinning the scope of work. While the solicitation process above is underway, reduce the agreement with Victorian Brothers to writing to establish the scope of work, documentation and inventory standards that must be maintained, and set clear guidelines for commission amounts.

RCPA Response: RCPA partially agreed with this recommendation, stating that NYS PA Guidelines allows payment to outside vendors based on invoices. RCPA notes past difficulties in finding qualified local auction vendors and emphasizes Victorian Brothers’ expertise. To comply with the recommendation, RCPA is negotiating a contract with Victorian Brothers, which will serve as a template for future vendor agreements.

Auditor Comment: Formalizing the agreement is a good step, but relying on a single vendor without competition reduces accountability. Creating a fair and transparent vendor selection process is not only needed to ensure fairness and protect estate assets but also to enhance the credibility and integrity of the procurement process.

Improve its accounting and administration of estates:

7. Update the estate records in QuickBooks promptly to reflect all financial activities and estate account status accurately.

RCPA Response: RCPA agreed with the recommendation.

8. Ensure that all estate assets (including bank accounts and investment accounts) are included in the estate accounts.

RCPA Response: RCPA agreed with the recommendation.

9. Develop a written plan to ensure segregation of duties for the collection and custody of estate assets, authorizations for handling estate transactions, recordkeeping, and the reconciliation of estate account, adhering to NYS PA Guidelines.

RCPA Response: RCPA agreed with the recommendation.

10. Introduce a quality assurance process to conduct sample-based reviews to ensure internal compliance with NYS PA Guidelines, internal written procedures, and internal controls, including segregation of duties.

RCPA Response: RCPA agreed with the recommendation.

Recommendations Follow-up

Follow-up will be conducted periodically to determine the implementation status of each recommendation contained in this report. Agency reported status updates are included in the Audit Recommendations Tracker available here: https://comptroller.nyc.gov/services/for-the-public/audit/audit-recommendations-tracker/

Scope and Methodology

We conducted this performance audit in accordance with Generally Accepted Government Auditing Standards (GAGAS). GAGAS requires that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. The audit team believes that the evidence obtained provides a reasonable basis for our findings and conclusions within the context of our audit objective(s). This audit was conducted in accordance with the audit responsibilities of the City Comptroller as set forth in Chapter 5, §93, of the New York City Charter.

The scope of the audit was January 1, 2022 to August 14, 2023.

To obtain an understanding of the policies, procedures, and regulations governing RCPA and to accomplish the audit objective, the auditors reviewed the NYS PA Guidelines, Articles 11 and 18 of the New York Surrogate’s Court Procedure Act, and Directive 28 of the Office of the New York City Comptroller’s Internal Control and Accountability Directives. The auditors also interviewed RCPA officials to obtain an understanding of how RCPA conducts research to identify the decedents’ assets and ensures accurate accounting and safeguarding of estate assets. The auditors also interviewed RCPA’s Finance Director to comprehend RCPA’s case management system, QuickBooks.

To determine whether RCPA adequately safeguards estate assets, auditors reviewed RCPA’s process for collecting, recording, and securing decedents’ jewelry and other valuable items retrieved during the property searches. Additionally, the audit team attended an estate sale hosted by Victorian Brothers, on October 1, 2023, to observe how Victorian Brothers handled the estates’ inventory, sale transactions, and cash collected during the estate sales.

To determine the number of active and closed cases during the scope period, the auditors obtained and reviewed an account listing of all estate accounts as of August 14, 2023. The auditors categorized the estate accounts relevant to the scope period into four groups: (1) active cases with estate values, (2) active cases without estate values, (3) cases closed in 2022 and after, and (4) guardianship cases. Subsequently, the auditors selected a sample of 67 cases as follows:

• 33 randomly selected and two judgmentally selected from 232 active cases that contain estate values;^[21]
• 21 randomly selected from 212 active cases without estate values;
• eight randomly selected from 52 closed cases;
• two randomly selected from 19 active guardianship cases; and
• one re-open case that was not listed in the account listing as active.

To determine whether RCPA properly identified estate assets as per the NYS PA Guidelines, auditors reviewed the investigation report, initial search report, and letters to financial institutions that were maintained in the sampled estate folders. Additionally, the auditors obtained and reviewed videos and photographs of the initial searches of residences for the 35 active cases with estate values.

To determine whether RCPA properly accounted for the 35 active cases with estate values, the auditors obtained and reviewed QuickBooks’ Transaction Details Reports for the period from January 1, 2022 to August 14, 2023. The auditors then compared the transactions to the invoices, deposit slips, and checks issued that were maintained in the estate folders for accuracy and completeness. The auditors also reviewed estate account bank statements and bank reconciliation statements for June and July 2023 to determine that all cash receipts and disbursements were properly accounted for by RCPA.

To determine whether funds maintained in the bank accounts were properly insured, the auditors obtained the security agreements for all active cases with estate bank accounts that had balances greater than the FDIC-insured amount.

Finally, the auditors searched for: (1) unclaimed funds that were submitted to the New York State Comptroller’s Office; (2) real property using the City’s Automated City Register Information System; and (3) LexisNexis to determine whether all the estate assets are properly identified and included in the estate accounts for the 67 sampled cases.

The results of the above tests, while not projectable to their respective populations, provided a reasonable basis for the auditors to evaluate and support their findings and conclusions regarding RCPA’s estate asset identification and management practices.

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Endnotes

[1] The PA was appointed in January 2019 and the Deputy PA was appointed in February 2019.

[2] In its response, RCPA states that a “more accurate statement regarding the statutory distribution of assets that go to the RCPA Suspense Account” would be that “RCPA receives 1% of the gross assets of each estate.”

[3] RCPA has no formal archiving policy.

[4] Section IV(A)(3)

[5] RCPA did not conduct residence searches when decedents no longer had a residence before their passing or shared a residence with others; the residences had already been sold, cleaned out by relatives or others, or returned to landlords before RCPA’s involvement; or the cases were referred to RCPA many years after the passing of the decedents.

[6] Section IV(A)(7)

[7] Section I(B)(2)(b)

[8] Section III(A)(5)

[9] Section IV(B)(2)

[10] Section IV(C)(2)

[11] Other payment methods include Venmo and personal checks.

[12] Section V(B)

[13] Vehicle sales are not always handled by Victorian Brothers.

[14] Section I(B)(2)

[15] The case status was updated from “closed” to “re-open,” and the cash retrieved from the safety deposit box was also recorded in QuickBooks in the subsequent record that the auditors obtained on October 26, 2023.

[16] The estate folder has the correct status.

[17] The total of the four payment transactions was $1,572.

[18] Section I(C)

[19] A suspense account contains funds representing reimbursement of disbursements for particular estates made from the suspense account prior to the collection of estate assets.  Suspense account monies may not be commingled with estate funds.

[20] Section I(D)(4)

[21] The auditors judgmentally selected two active cases that the auditors observed the estate sales on October 1, 2023.  Of the 35 selected active cases that contain estate values, 26 cases have an account value over $50,000 and nine cases have an account value up to $50,000.