When choosing an agent to serve pursuant to a Financial Power of Attorney, it is important to choose someone you trust – someone that would handle your financial matters competently and appropriately. Unfortunately, sometimes a family may discover that an elderly loved one has named an unscrupulous individual as his or her agent. Through a Financial Power of Attorney, a named agent generally has the authority to make financial decisions on behalf of an elderly individual.
The agent typically helps to take care of the senior’s financial affairs when he or she cannot do so alone. Duties may include writing checks, signing documents or selling assets. The agent is to use the authority granted for the benefit of the senior, not for himself or herself.
The potential to misuse the authority granted, however, may tempt dishonest individuals to persuade their elderly relatives into naming them as an agent. Elder abuse could occur if other family members fail to monitor or limit the agent’s activities.
Searching for signs of financial abuse
As reported by Kiplinger magazine, 90% of elder abuse incidents involve someone the victim already knows and trusts. Unpaid bills, collection letters or new credit cards opened in an elderly person’s name may indicate an agent has less-than-honorable motives.
It is not uncommon for seniors to give relatives money when asked, but even small sums over an extended period may add up. By the time a family realizes money is missing, the amount could have a significantly negative impact.
Reducing the risks of elder fraud
When executing a Financial POA, it is important for the principal to carefully choose the agent and to determine what authority to give to the agent. It is best to get advice from an elder law attorney to help with this process. As noted by ABC News, a family may also choose to create a financial POA, which is limited to only authorize an agent to pay bills.