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Jul 24, 2022 by |

San Francisco Bay Area Financial Elder Abuse Attorneys: Why A Financial Power Of Attorney Is A Dangerous Document

ATTORNEY NEWSLETTER

Complete Authority Over Principal’s Finances And Property

Potential For Abuse

Remedies For Injured Principals

The most dangerous estate planning document which an individual may have is a financial Power of Attorney (POA). See Cal. Prob. Code §§ 4401 (statutory form for financial POA). The POA allows another person – an “Agent”– to perform financial transactions for another person – a “Principal.”  The POA is not just another legal document – it is an incredibly powerful tool.  In the wrong hands, POAs are extremely dangerous for the Principal.  Do you want to take money from someone’s bank account?  A POA allows you to go to the Principal’s bank, produce the POA, and transfer the money wherever you want.  Do you want to sell someone’s home? Yes, you can do that with the POA.  What about liquidating the Principal’s stock so that you may take your long-deserved vacation?  Pull out the POA and you can be in the Islands in no time.  These examples of misuse of a POA seem extreme, but we have seen cases where POAs were misused in just these very ways. The law provides remedies, discussed below, and we can help injured seniors hold agents accountable for misuse of POAs. 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).

Authority Given By Power Of Attorney

The power to transact someone’s business affairs is typically given to someone who the Principal trusts implicitly – this is the primary check on its misuse.  But, unfortunately, that confidence is sometimes misplaced.  When an Agent takes money for his or her own benefit, it is more than a problem for the Principal, it is a crime, and where the principal is a senior, a crime of financial elder abuse and grounds for civil liability.  See Penal Code § 368 (crime of financial elder abuse); Cal. Welf. & Inst. Code § 156103.0 (civil definition of financial elder abuse).

The Agent under the POA has three primary responsibilities:

  1. to undertake each transaction in the best interest of the Principal
  2. to keep his or her assets separate from the Principal
  3. to keep a written record of the transactions undertaken by the Agent under the POA

Of course, these duties and responsibilities do not stop someone who is intent on using the POA to take advantage of the situation and the Principal.  These duties and responsibilities also illustrate why it is so important for the Agent or Agents to be trusted individuals the Principal has known for a long time.  Never, ever allow an older loved one to give a Power of Attorney to a caregiver.  A caregiver is paid to provide medical care and assistance and has no business whatsoever getting involved in an older person’s financial affairs.

Civil Remedies For Misuse Of POAs

The California Probate Code and Elder Abuse Act both provide enhanced remedies for any misuse of a POA. First, the Principal is entitled under the Probate Code to twice any amounts taken and attorneys’ fees for the victim. Probate Code § 4231.5.  Where the principal is over age 65 or a dependent person (as the principal in the reported case), the misuse also constitutes criminal and civil financial elder or dependent adult abuse under California law.  Penal Code § 368; Cal. Welf. & Inst. Code § 15610.30.  Anyone assisting the Agent in taking a senior’s property is also guilty of financial elder abuse under the law.  Agents who wrongfully take the property of seniors (and their assistants in the taking) 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>.

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