THE MISUSE OF POWERS OF ATTORNEY
A Power of Attorney for Property gives one or more individuals the authority to deal with your assets and liabilities. If there are no limitations in the Power of Attorney (and usually there are not) the Power of Attorney will allow the people you name to do anything you can do except make a Will.
The authority granted in a Power of Attorney for Property can be misused and unfortunately, more and more often, it is. If those named in the Power of Attorney for Property decide to use the Power of Attorney dishonestly, it will give them the authority to deal with your bank accounts and other assets. Those who misuse the Power of Attorney are often family members and most often children.
Consider the following to minimize the risk of Power of Attorney misuse:
- Leave the Power of Attorney with your lawyer with instructions to release it only with your written instructions or with a letter from your doctor indicating you are incapable;
- Do not give a copy of the Power of Attorney to those who are named in it. A copy of a Power of Attorney may be misused in the same fashion as an original may be;
- Appoint more than one person as attorney and require that they act jointly;
- Consider having an independent person (a trusted friend or your lawyer or accountant etc.) as one of the attorneys and require that the individual form part of any majority for decisions to be made under the Power of Attorney. That independent party will probably allow family members to establish a current bank account into which funds will be deposited so that they can take care of your day to day affairs. The third party will then generally just be involved in an annual review of account activity and on decisions that have to be made concerning your financial affairs;
- Consider appointing a trust company as your attorney under the Power of Attorney.
Feel free to contact us at any point for assistance or advice with respect to Estate Law, Estate Planning or Estate Administration. We may be reached at 705.435.4339 or contact us via email.