What happens if an heir withdraws money from a parent’s bank account or credit cards after death? (Arkansas FAQ)

Short answer: In Arkansas, money taken from a deceased person’s account by an heir may need to be returned to the estate unless the heir had a legal right to the funds (for example, as a surviving joint owner or a named beneficiary). The personal representative (executor/administrator) can pursue civil claims (accounting, conversion, unjust enrichment) and may ask law enforcement to investigate possible criminal theft or fraud. This is general information, not legal advice.

How ownership works when someone dies

Who lawfully owns the money depends on how the account or card was set up:

Sole account with no pay-on-death (POD) or beneficiary designation: The funds become part of the decedent’s probate estate and are controlled by the personal representative after the court appoints them.
Joint account with right of survivorship: The surviving joint owner usually becomes the owner automatically and may lawfully use the funds.
Payable-on-death (POD) or transfer-on-death designations: Funds pass to the named beneficiary outside probate. A named beneficiary’s withdrawal is ordinarily lawful.
Authorized user on a credit card or joint cardholder: An authorized user may have continuing access depending on the card terms; a joint cardholder may have liability or rights depending on the contract.

If an heir withdraws funds after death and had no legal right, what can the estate do?

The personal representative (executor or administrator) has several remedies under Arkansas law and general principles:

Demand return and accounting: The personal representative can demand the money back and require an accounting of how and when funds were removed.
Civil action for conversion or unjust enrichment: The estate can sue the person who took the funds to recover the amount taken plus possible interest and costs.
Probate remedies: During estate administration the personal representative must collect estate assets and may petition the probate court for orders to recover misappropriated assets, to surcharge (hold an heir personally responsible) or to adjust distributions.
Criminal referral: If the withdrawals appear to be theft, fraud, or embezzlement, the personal representative can file a police report and request a criminal investigation. Arkansas criminal statutes address theft and related offenses; prosecutors may pursue criminal charges independently of any civil case.
Bank claims: If a bank paid out funds without proper authorization after learning of the death, the estate may have a claim against the bank. Banks often freeze accounts when notified of a death; how the bank responded can affect recovery options.

Practical steps to protect the estate and preserve recovery options

Obtain certified copies of the death certificate and deliver them to the bank.
Contact the bank immediately to ask that accounts be frozen and to request transaction records and copies of checks or images.
Preserve all evidence: bank statements, ATM receipts, card activity, phone or text communications, and any note or letter from the person who withdrew funds.
Notify the personal representative (executor) or, if none has been appointed, consider petitioning the probate court to appoint one so the estate can act formally.
If theft is suspected, consider filing a police report and ask law enforcement to investigate; criminal charges do not prevent a civil action for recovery.
Talk to a probate or estate attorney promptly to evaluate civil and probate claims, statutory deadlines, and next steps for recovery.

Common defenses an heir might claim

They were a joint account holder or named beneficiary (lawful transfer).
They were an authorized user or had an oral or written agreement permitting the withdrawals.
They were making payments on the decedent’s behalf (e.g., to prevent creditors from seizing assets) — those facts matter and require proof.

Timing, statute of limitations, and courts

The estate’s ability to recover depends on deadlines and the probate schedule. Arkansas has both probate procedures and statutes covering civil claims; different claims have different limitation periods. Because those time limits can be complex, the personal representative should act quickly and consult an attorney to avoid losing legal rights.

Relevant Arkansas law resources

For official Arkansas statutes and to read the probate and criminal code, see:

Arkansas Code — Title 28 (Probate): https://www.arkleg.state.ar.us/ArkansasCode/Title?title=28
Arkansas Code — Title 5 (Criminal Offenses): https://www.arkleg.state.ar.us/ArkansasCode/Title?title=5
Arkansas Code — banking/financial institution rules may also apply: https://www.arkleg.state.ar.us/ArkansasCode/Title?title=23

Hypothetical example

Suppose Sarah’s father dies leaving a bank account in his name alone. Sarah’s brother Ben withdraws $6,000 from that account using the checkbook and an ATM card after their father’s death and before anyone told the bank. When the personal representative is appointed and discovers the withdrawals, the representative demands repayment. If Ben refuses, the representative can seek recovery through probate court, file a civil suit (conversion/unjust enrichment), and ask law enforcement to investigate for possible theft.

When an heir’s withdrawal may be lawful

If Ben had been a joint owner on the account, or the account had a POD beneficiary, Ben’s withdrawal might be lawful. The distinction between a joint account owner, a mere payee, and an authorized user is critical and often depends on account paperwork and the bank’s records.

Helpful hints

Act quickly: freeze accounts, gather documents, and contact the bank and the probate court.
Do not try to resolve complex disputes without legal help — wrong moves can harm the estate’s recovery rights.
If you are the personal representative, keep meticulous records and obtain court orders before distributing assets.
If you are an heir who withdrew funds believing you had a right, gather proof (account agreements, beneficiary forms, written permissions) to support your position.
Consider both civil and criminal remedies — they can run in parallel. Recovery in civil court does not depend on a criminal conviction.

Disclaimer: This article provides general information about Arkansas law and is not legal advice. It does not create an attorney-client relationship. Laws change and every situation is different. For advice about a particular case, consult a licensed Arkansas probate or estate attorney.