A Lancaster County judge is being asked to settle a legal fight over what to do with $3.6 million in life insurance payouts to the trust of a Lincoln businessman who left millions more in outstanding bank loans allegedly obtained by fraud.
Following Aaron Marshbanks’ suicide in a downtown Lincoln parking garage on Nov. 2, 2022, bankers across the state began reporting that he had taken out millions in loans, allegedly based on financial statements misstating the value of his collateral provided by his investment advisor, Jesse Hill.

Marshbanks, Aaron
Within two days, the first of more than 20 creditors — banks, savings and loans and credit unions — started filing demands for notice of an application for informal probate of will and statements of claims.
At a hearing Friday, the question for County Court Judge Holly Parsley was where the money should go: to Marshbanks’ family or to his creditors.
People are also reading…
Omaha Attorney Amy Jorgensen, who represents the court-appointed special administrator, said there were six life insurance policies at issue, excerpts of which she offered into evidence, along with the trust agreement.
She said the proceeds from them aren’t exempt from claims of creditors.
“And the trust expressly mandates the trustee to pay the claims of creditors of the Marshbanks’ estate prior to any distribution to the beneficiaries under the trust,” Jorgensen said.
She pointed to three articles within the trust as support for her position.
Jorgensen said the undisputed facts show that the estate’s net assets total about $9.7 million and stipulated claims to date total about $34 million.
“The estate’s assets are insufficient to cover the payment of the estate’s stipulated claims and thus require the trustee to use the proceeds from the life insurance policies of $3.6 million to pay the estate’s stipulated claims,” she said.
On the other side, attorney William Lindsay Jr., who represents Marshbanks’ widow, Jennifer Marshbanks, the beneficiary of the trust, argued the life insurance proceeds should be exempt.
“We are asserting that this has not been expressly waived by the trust,” he said.
Lindsay argued that the special administrator was trying to put together three provisions of the trust, one of which didn’t even mention life insurance, to try to get the language there.
“Now we look at the cardinal rule of interpreting the trust: What is the intention?” the attorney said. “It’s for the benefit of his family. That’s the purpose of this.”
Lindsay said it was not for the benefit of the creditors.
In rebuttal, Jorgensen said that once the trustee accepted the life insurance proceeds, it’s mandated that the trustee must administer the proceeds in accordance with the trust.
She said the trust provides for the mandatory payments of the estate claims prior to the beneficiaries, and she noted that Marshbanks could have made it discretionary.
“But that’s not the case. It was mandatory payment of those claims,” Jorgensen said.
Parsley took the matter under advisement.
Download the new Journal Star News Mobile App
Top Journal Star photos for April 2024

Zeman Elementary School first grade teacher Eileen Schmeichel is doused with water from a splash tower during the Zeman Color Run at Zeman Elementary School on Saturday.

Dr. Jeff Gold, the priority candidate for the University of Nebraska President position, speaks during a public forum on Monday at the City Campus Union.

The Silver Hawks start to dogpile on Lincoln Southwest’s Charley Kort (right) after she scored the game-winning goal Saturday in the final seconds of the second overtime against Gretna at UBT Stadium.

Lincoln Southwest’s Caden Ransom (center) celebrates his home run against Lincoln Pius X, Wednesday, April 10, 2024, at Sherman Field.

Sen. Robert Clements of Elmwood (left) stands with Sen. Justin Wayne of Omaha as Wayne asks him a question on his bill during floor debate at the Capitol on Thursday, the second-to-last day of the session.

Good Life Community Development executive director Bill Radke (left) checks on grilled pineapples next to Cody Shafer in the kitchen at JTK Cuisine & Cocktails.

Trey Lamkins, a horticulture major at the University of Nebraska-Lincoln, rubs his head after seeing his new look for the first time during the Shave for the Brave event at the Willa Cather Dining Complex on City Campus on Thursday. Twelve UNL students shaved their heads to raise funds to help find cures for children with cancer. Lamkins’ mother passed away last August. “Though she’s no longer with us, her spirit fuels my determination to make a difference in the lives of those still fighting,” he wrote. Around $6,000 was raised ahead of the event at UNL, which has put on the event for the last seven years. The donations will go to the St. Baldrick’s Foundation, but the hair will be donated to the Matter of Trust, which uses the donated hair to clean up oil spills and make goods such as burlap sacks and stockings.

A partial solar eclipse is seen over Lincoln, Monday at Hyde Observatory.

Lincoln Fire and Rescue personnel remove a person following a standoff at the Casey’s near the airport on Tuesday.

Engine seven crew members Eric Morgan (left) and Kirsten Bell practice advancing with a fire hose at Den Hartog Field on Tuesday.

Sen. Jen Day of Omaha (left) is embraced by Sen. Tony Vargas of Omaha after Day honored him for his service to the Legislature at the Capitol on Thursday.

Kevin Matthews, a Bellevue East sophomore (from left), Brooklyn Freeman, a Omaha Westview sophomore, and Royalty Aguer, a Papillion La Vista South senior, try to keep their cup stack together while participating in a team-building activity during the Greater Than One District Equity Collaboration Summit at the Don Clifton Professional Learning Center on Wednesday.

On April 9, the Lincoln Police Department responded to a reported shooting an apartment in the 1100 block of G Street at about noon.

Bartender Ashley Novak pours a mixed drink at Deb’s Place on Saturday in Lincoln. Deb’s Place, formerly Cliff’s Martini Lounge, offers more than 30 signature martinis.

Eighth-graders (from left) Treyvious Buettner, Ethan Poulsen, Eli Norval and Yousif Kadhim look up at the solar eclipse on Monday at Mickle Middle School.

Nebraska head coach Will Bolt looks on during the Ohio State game on Saturday at Haymarket Park.

Nebraska’s Rhett Stokes (left) outs Ohio State’s Henry Kaczmar on Friday, April 5, 2024, at Haymarket Park.

Trey Coley Lusk as Barbie Esther (center) and the rest of the cast rehearse a musical performance for the Barbie Megillah Purim Spiel on Thursday, April 4, 2024, at South Street Temple. Purim takes place annually on the 14th day of the Hebrew month Adar. This year, Purim was observed on March 23 and 24. The holiday surrounds Queen Esther, a Hebrew woman who saved the Jewish people from a royal official named Haman. Every year, Jewish communities around the world read the Megillah of Esther, a scroll detailing the story of Esther’s heroics. South Street Temple will be presenting Barbie Megillah directed by Zoë Watch and written by Jaime Marx. The performance will combine the story of Esther with themes from the 2023 hit film Barbie.

Newman Grove FFA members Kailey Patzel (back left), Allyx Forre (front left), Aubree Whitaker (back right) and Cora Patzel and Hayes Center FFA member Addison Richards (front right) work together to pack Mercy Meals on Thursday at Pinnacle Bank Arena. Thousands of high school FFA members, advisors and guests are in Lincoln this week for the 96th annual state convention. The meals FFA members prepared on Thursday, which include rice, dehydrated vegetables, soy and a flavored vitamin and mineral powder, will be delivered to children in need.

Kaleb Garr takes a bite out of his breakfast Runza on Wednesday. The Runzas weren’t being sold. Instead, customers were asked to give a donation that would go toward Runza’s Feed the Need charity event.

Lincoln Southwest’s theater director Austyn McKee sits for a portrait on Tuesday, April 2, 2024, at Lincoln Southwest.

Nebraska’s Bella Bacon (right) scores at home plate next to Kansas’ Lyric Moore on Tuesday at Bowlin Stadium.

Lincoln North Star’s Jameson Lantz is tagged out by Lincoln Southwest’s Landon Sandy at home plate Tuesday at Den Hartog Field.

U.S. Surgeon General Vivek Murthy answers questions at Bryan Medical Center East Campus on Tuesday.

Weightlifting students jog around the weight room on Tuesday at Waverly High School. The current weight room is located on top of the locker rooms in a space that was originally designed as a wrestling practice area. “In order for the program to grow, we need more space,” said Anthony Harms, the strength and conditioning coach at Waverly High School.

Nebraska women’s golfer Mackenzie Bream gets in some chipping during a team practice on a rainy Monday at Jim Ager Golf Course. Lincoln officially received only .01 inches of rain on a dreary Monday, when the temperature hovered in the upper 40s for most of the day under cloudy skies. The clouds will move out, bringing sunny skies starting Tuesday, although the temperature is forecast to remain below normal, with highs in the 50s through Wednesday, before a warmup that should lead to highs in the 70s by the weekend.
Reach the writer at 402-473-7237 or lpilger@journalstar.com.
On Twitter @LJSpilger