ATTORNEY NEWSLETTER
Financial Powers Of Attorney Are Powerful Instruments
Abuse Of Powers Always A Risk
Examples Of Power Of Attorney Abuse
Estate planning documents for most persons include Wills, possibly trust agreements and, especially as we get older, powers of attorney. Powers of Attorney (POAs) are important and powerful legal documents that grant the agent appointed under the POA full legal authority to act for the principal who executes the POA. There are powers of attorney for financial matters and for health care matters. See Cal. Prob. Code §§ 4401 (statutory form for financial POA) and 4701 (Advance Health Care Directive for medical matters). While POAs are useful and indeed necessary at times (especially as one ages), the potential for abuse of such broad power is always present. Financial POA abuse includes outright theft of the principal’s money or property and, in a broader sense, making any decision or taking any action that is not in the donor’s best interest. When the principal is a senior, Power of Attorney abuse may be a violation of both the Probate Code and Elder Abuse Act. See Probate Code § 4231.5 and Cal. Welf. & Inst. Code § 15610.30. Even for the most trustworthy attorney-in-fact, the burden of making decisions for a principal is a heavy one. Therefore, we recommend you appoint two trusted individuals as agents under any POA to act jointly. Additionally, you can hire a licensed, bonded and insured fiduciary to act as Attorney-in-Fact– look at PFAC.org or the PFAC (Professional Fiduciary Association of California) in your County for recommendations. Never, ever, grant a Power of Attorney to a caregiver. Caregivers and others can wield their POA power to change a principal’s entire estate plan and redirect the principal’s assets to themselves. If an agent has misused a POA to your or an older loved one’s detriment in San Francisco or elsewhere in California call us at (415)441-8669 or toll free at 1-888-50EVANS (888-503-8267).
Examples Of Power Of Attorney Abuse
Two reported cases illustrate the dangers of POA abuse.[1] In the first example, a pastor allegedly stole up to $50,000 from a 91-year-old church member. According to police, the pastor took the elderly church member who reportedly has dementia to a credit union to apply for a loan to buy a pontoon. The loan officer denied the loan request even after she was shown a power of attorney document for the elderly member that the pastor presented during the loan application process. According to police, the loan officer became suspicious when she noticed the pastor’s folder contained other power of attorney documents for other members of the same church. According to police, the defendant repeatedly used the couple’s money to make personal payments on his own behalf, including for a car loan. In all, the pastor allegedly embezzled up to $50,000, including cashing out two life insurance policies.
In the second example, an individual was given a POA to manage the affairs of two residents of an assisted living facility, who were unable to pay their own bills. Although the Attorney-in-Fact was responsible for paying their bills, prosecutors allege that the individual instead pocketed nearly $300,000 of the victims’ funds, spending on herself and ignoring the needs of the two principals. The investigation was initiated when the victims became at risk of being evicted from their assisted living apartments, according to the DOJ.
Remedies For POA Abuse
POA abuse is grounds for civil liability of twice any amounts taken and attorneys’ fees for the victim. Probate Code § 4231.5. Where the principal is over age 65 the misuse also constitutes criminal and civil financial elder abuse under California law. Penal Code § 368; Cal. Welf. & Inst. Code § 15610.30. Agents who wrongfully take the property of seniors are responsible not only for twice the amount taken under the Probate Code but also, under the Elder Abuse Act, enhanced damages. Both the Probate Code and the Elder Abuse Act grant the injured senior attorneys’ fees and expenses incurred in suing to get their property back. Probate Code § 4231.5(c); Cal. Welf. & Inst. Code § 15657.5.
Contact Us
Ingrid M. Evans can represent you if an agent has misused a Power of Attorney granted by you or an older loved one in San Francisco or elsewhere in California. If you need help, call us today at 415-441-8669 or toll free at 1-888-50EVANS (888-503-8267).or by email at <a href=”mailto:info@evanslaw.com”>info@evanslaw.com</a>.
[1] Evans Law Firm, Inc. was not involved in either of the two reported cases in any way.
