Disclaimer: This is educational information only and not legal advice. Laws change and every case is different. Consult a licensed New Mexico attorney to evaluate your specific situation.
Detailed Answer
When a parent dies, the money in their bank accounts and the charges on their credit cards become part of their estate unless the accounts transfer automatically to someone else by law or contract. If an heir withdraws funds or uses credit cards after the parent’s death without legal authority, the person who is administering the estate (the personal representative) can often try to recover that money through civil or, sometimes, criminal remedies under New Mexico law.
Who owns the money after death?
Ownership depends on how the account is titled and on beneficiary designations:
- Accounts titled solely in the decedent’s name generally become estate property and pass to heirs through probate.
- Payable-on-death (POD) or transfer-on-death (TOD) accounts pass directly to the named beneficiary outside probate.
- Joint accounts may pass to the surviving joint owner if the account has a right of survivorship. If the joint account was truly only for convenience, or if there is a dispute about whether a transfer was intended, the funds may still be subject to estate claims.
For general guidance on probate procedures and who acts for the estate, see the New Mexico Probate Code (NMSA 1978, Chapter 45): https://www.nmlegis.gov/Legislation/Statutes/Chapter?Ch=45, and the New Mexico Courts probate self-help pages: https://www.nmcourts.gov/self-help/probate/.
Is withdrawing money after death illegal?
It can be. If someone takes estate funds or uses credit cards after the decedent’s death without authority, the action may be treated as conversion, unjust enrichment, or theft. The estate (through its personal representative) can demand repayment, file a civil lawsuit for recovery, and in some cases the matter can be referred to law enforcement for criminal charges. New Mexico criminal statutes addressing theft, fraud, and related offenses are in the state criminal code: https://www.nmlegis.gov/Legislation/Statutes/Chapter?Ch=30.
How the estate can recover the funds
- Freeze or stop further withdrawals. The personal representative should notify the bank and card issuers, provide a death certificate, and ask the institution to freeze the account until probate determines ownership.
- Demand repayment. Often the personal representative sends a written demand to the person who withdrew funds. Many disputes settle after a demand letter.
- File a claim in probate. If the estate is open in probate, the personal representative can include the claim as an estate action and recover funds as an asset of the estate.
- Civil lawsuit. If the person refuses to return the money, the estate can sue for conversion, unjust enrichment, or breach of fiduciary duty (if the taker was in a position of trust).
- Criminal referral. If the withdrawal involved fraudulent conduct, the personal representative or beneficiaries can report the matter to law enforcement or prosecutors. Criminal charges (theft, fraud) are possible depending on the facts and priorities of prosecutors.
Common legal theories used to recover funds
- Conversion: Wrongful exercise of control over someone else’s property.
- Unjust enrichment: Recovery when someone benefits at the estate’s expense without legal justification.
- Breach of fiduciary duty: If a person held a fiduciary role (executor, agent under a power of attorney that expired at death, conservator) and misused estate assets.
Practical examples
Example 1 — Sole account: If the decedent had a bank account in only their name and an heir withdrew $10,000 after death without permission, the personal representative can demand return and, if necessary, sue for conversion and recover the money for the estate.
Example 2 — Joint account: If an account was jointly held with right of survivorship, the surviving joint owner likely keeps the funds. If the joint owner took money that was demonstrably the decedent’s separate property (and not intended as a survivorship gift), the estate may have a claim.
Example 3 — Credit cards: Credit card balances are debts of the decedent and should be paid from the estate. Unauthorized charges made after death can be disputable with the card issuer and may provide a civil claim against the cardholder who used the account.
Evidence the estate should preserve
- Bank statements and transaction records before and after death
- Copies of the death certificate
- Account agreements, beneficiary designations, and titles
- Text messages, emails, or written communications about the withdrawals
- Any demand letters, responses, or settlement offers
Who can bring the claim?
Only the personal representative (appointed by the probate court) or, in some limited circumstances, a creditor or heir acting through the estate, can assert claims on behalf of the estate. If no probate is opened and the estate is small, some non-probate procedures or small claims may apply depending on the facts.
Helpful Hints
- Act quickly. Promptly notify banks and card issuers and the appointed personal representative.
- Preserve evidence. Download and save transaction records, communications, and account paperwork.
- Don’t confront alone. Avoid escalating conflict; use written demands and legal channels.
- Check account designations. Look for POD, TOD, or joint-tenancy language that may change who gets the money.
- Use the probate process. The probate court supervises estate administration and enforces recovery of estate property; see New Mexico Probate Code (NMSA 1978, Chapter 45): https://www.nmlegis.gov/Legislation/Statutes/Chapter?Ch=45.
- Consider both civil and criminal remedies. If the withdrawal looks fraudulent, contact local law enforcement after discussing with counsel.
- Consult a New Mexico attorney. An attorney can advise on the right claim (conversion, unjust enrichment, or other), prepare demand letters, file probate claims, and protect the estate.
- Keep beneficiaries informed. Transparency reduces family disputes and may help reach a resolution without litigation.
For more information about how New Mexico handles probate and estate administration, see the New Mexico Courts probate resources: https://www.nmcourts.gov/self-help/probate/. For statutory text, consult the New Mexico statutes: Chapter 45 (Probate) and Chapter 30 (Crimes) on the New Mexico Legislature website.
If you believe someone has wrongfully taken estate funds, contact a licensed New Mexico attorney promptly to discuss the facts and next steps.