Power of Attorney Abuse and Misuse (2023)


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Power of Attorney Abuse - When someone who has been given a power of attorney (agent) takes an action that is not in the best interest of the person who gave power of attorney (principal).
An agent, under a power of attorney, has a legal duty to act in the best interests of the principal. The agent should be trustworthy and perhaps act consistently with the decisions that the principal had made for themselves before becoming incapacitated.

Failing to keep records and account for all of the money and property they are handling.

Self dealing

Misappropriation (credit card fraud). Treat principal’s bank account like it is your own.

Coercion into making a POA


It is tough to file an action for abuse of POA power because the person that is harmed from the abuse of power is often incapacitated. Usually the remedy is for some other person to initiate a guardianship or conservatorship proceeding to become the legal guardian of the principal and override actions of the agent - that is expensive and adversarial.
At best, creates serious sibling conflict. At worst, it could be a criminal action. Have you seen examples of power of attorney abuse?


Hey there, I'm a state planning attorney, paul ramilah and in this video we're going to talk about how someone misuses or abuses the power they have under a power of attorney.

So we've seen it often an example where, let's say mom signed a power of attorney and mom who created the power of attorney, is called the principle and, let's say in our circumstance, mom granted power of attorney to daughter, daughter, is what's called the agent and that power of attorney abuse takes place.

When someone who has been given the power of attorney, the agent takes an action that is not in the best interest of the person who gave the power of attorney called the principal.

So the agent under a power of attorney does have a legal duty to act in the best interest of the principal.

Sometimes people ask me paul.

If, if I give my son power of attorney, that means he can just go to the bank and take all of my money and do whatever he wants to with it, because I gave him power attorney.

Well, no, it doesn't mean he has the right to do that.

He has an obligation to take actions that are in your best interest, so the agent that you designate on a power of attorney should be trustworthy and perhaps should act consistently with the decisions that you had made for yourself before you became incapacitated because that's when these powers of attorney are typically used and abused, it's when that principle, the person who created the power of attorney can no longer act for themselves.

So I want to go through some of the actions that we've seen and then perhaps in the comments below you can tell me some circumstances where you may have seen someone abuse their power under a power of attorney.

So one mistake: some agents make misusing their power under a power of attorney.

Is they fail to keep the records and account for all of the money and property that they are handling? Sometimes that's an honest mistake, but it really is important that the agent keep good records and, in case they're questioned in the future about how they handle the money for the principal.

But, as we start getting into, you know, misuse and abuse.

We start talking about.

You know.

Self-Dealing, for example, let's say mom had a car and mom's now incapacitated.

She no longer drives anymore, so it makes sense for mom to sell her car.

So mom has a 50 000, mercedes benz, and you know what the agent's uh 22 year old daughter, could use a new car, so the agent's daughter buys mom's 50, 000, bins used, but nonetheless still worth fifty thousand dollars.

Agent's daughter buys that car for three thousand dollars, and so that would be self dealing on behalf of the agent.

That's not right.

Another area where we see some abuse is is the misappropriation of funds.

Sometimes we see agents use the credit cards run up unbelievable credit card bills on the principal's credit cards.

That's credit card fraud.

That's not good, so got to be careful for that.

Sometimes you'll see an agent treat the principal's bank account like it's.

The agent's own bank account that also a big no-no.

Sometimes you'll see people making a state, it doesn't fall directly under power.

Attorney abuse, but you'll see people uh inappropriately.

You know, coercing someone into making a power of attorney daughter says: hey mom.

Look, I want to take I'll, be happy to take care of your money.

Let's just go run down to the lawyer's office and get a power of attorney signed.

You can appoint me as the agent and I'll take care of all of your money and mom's like well.

I don't know if I want to do that, and I don't know if you're the right person daughter says, come on mom I'll, bring you and we'll make this easy and I'll.

Take you to lunch after and so mom signs the power of attorney.

You know, mom gets dementia and then daughter's off and running with mom's money.

That's not right! Sometimes you see just outright theft with uh someone abusing the authority that they have under a power of attorney the principal has a bank account with 250 000 in it um the principal gives the agent power of attorney.

The agent goes to the bank, pulls out 225 000 and puts that into the agent's own bank.

Account that's outright theft, so got to be careful about that.

The concern about power of attorney abuse is it's tough to file an action? It's tough to tough to remedy power of attorney abuse, because the person that is harmed at the time that abuse is discovered, the person that's harmed is often incapacitated, and so usually the remedy is for some other person.

Maybe another child of the principal who's now incapacitated to initiate a guardianship or a conservative ship, proceeding to become the legal guardian of the principle and override actions of that power of attorney agent and that's a very expensive and adversarial proceeding so um at best.

Some inappropriate action of a power of attorney agent at best creates some serious sibling conflict and at worst there it could be a criminal action with all the uh criminal.

You know results that come from that, so have you had if you've seen examples of power of attorney abuse.

You know we've got to keep our eyes open.

We got to keep on the lookout if you've seen some abuse like that.

Just describe it in the comments below and it'll tell others what to look for and it'll keep our you know eyes and ears open so that um, you know, people who are truly trying to help others can can minimize the abuse that others are are doing as a result of being named as an agent on power of attorney, so tough area, tough to remedy.

That's why it's so important that people make the right decisions they get all of this set up while they have their good mind, they have good capacity.

They make good informed decisions, they put the right people in charge that can eliminate a lot of these power of attorney abuses in the future.

Make sure you like comment, subscribe, we'll see you next time, I'm paul rabale.


Power of Attorney Abuse and Misuse? ›

Some of the most common examples of abuse of power include neglecting the principal's needs, mismanaging the assets, or stealing from the principal's assets. An experienced lawyer will be able to explain to you what is involved in showing the evidence that a judge should invalidate a power of attorney document.

What is the crime of abuse of power? ›

A simple definition of the abuse of power is the misuse of a position of power to take unjust advantage of individuals, organizations, or governments.

How do you prove power of attorney abuse Texas? ›

Proving Power of Attorney Abuse Occurred

You will need sufficient evidence to show the abuse occurred. With financial abuse, providing documentation showing the agent transferred money into their accounts without your approval or made unauthorized purchases with credit cards could be the proof you need.

Can a power of attorney transfer money to themselves California? ›

Someone who has financial power of attorney to manage your property cannot legally transfer money to themselves or their own accounts from yours without written consent for a specific purpose.

What is the penalty for abuse of power of attorney in NSW? ›

Power of Attorney laws vary from State to State, however in the NSW context, the Act does impose penalties of up to 5 years imprisonment in the event that the attorney performs acts as an attorney knowing that authorisation under the Power of Attorney for such actions has been suspended or terminated.

What is an example of abusing your power? ›

Abuse of power examples:

Humiliating an employee in front of his colleagues. Forcing an employee to work overtime multiple times a week without additional pay. Boss mistreating employees when he/she is in a bad mood. Condescending reactions to employee questions.

What are the three types of power abuse? ›

What are the three types of power abuse? Abuse of power occurs in different forms. It is categorized into physical, financial, and sexual abuse.

Who can override a power of attorney in Texas? ›

A power of attorney (POA) is a legal contract that gives a person (agent) the ability to act on behalf of someone (principal) and make decisions for them. Short answer: The principal who is still of sound mind can always override a power of attorney.

Does a POA have to be filed with the court in Texas? ›

You do not need to file a power of attorney at the courthouse unless you want your agent to be able to act on your behalf in regards to a real estate transaction.

Can you sue someone for emotional abuse in Texas? ›

A physical injury can help the case but may not be necessary for you to get compensation. You can sue for emotional abuse when the following happens: Abusive behavior toward a spouse. Child abuse.

Can a power of attorney withdraw money from an IRA? ›

Since an agent with a power of attorney can manager a principal's finances, that same agent could withdraw from or cash in funds from an IRA. However, this can only be done in a way that benefits the principal and his or her needs.

Can a power of attorney change beneficiaries on an annuity? ›

With this power, your attorney-in-fact is also permitted to change and name the beneficiaries of your insurance policies or annuity contracts. This is a broad power, and it's a good idea to discuss your wishes about it with your attorney-in-fact.

Can I sell a car with power of attorney in California? ›

A POA may be used to release ownership on a title or bill of sale. As referenced in this manual, a POA generally refers to a DMV form which is limited to vehicle/vessel transactions.

What is common law abuse of power? ›

Abuse of power means the use by an official of his or her vested authority to improperly benefit another official, person or entity or using such power to improperly discriminate against another official, person or entity.

Is abuse of power a law? ›

Abuse of power or abuse of authority, in the form of "malfeasance in office" or "official abuse of power", is the commission of an unlawful act, done in an official capacity, which affects the performance of official duties.

What is Section 36 power of attorney Act NSW? ›

36 Interested persons may apply for review. (1) Tribunal may review making or operation and effect of power A review tribunal may, on the application of an interested person, decide to review the making, revocation or the operation and effect of a reviewable power of attorney or not to carry out such a review.

Is presidential abuse of power a crime? ›

Abuse of power isn't a federal crime, but articles of impeachment don't actually have to be tied to the criminal code or a particular statute. Historically, most impeachment articles didn't list a violation of a specific criminal statute.

What is abuse of power by police in us? ›

The term “abuse of power” encompasses all the ways police officers can abuse their positions by taking advantage of the very people they have pledged to serve and protect. While most police officers take that pledge seriously, there are some who abuse the power given them to fulfill selfish personal desires.

What is a sentence for abuse of power? ›

This was so conspicuously unfair as to be unlawful as an abuse of power. He was an apostle of liberty and a champion of authority, but abhorred any abuse of power. He talked in his speech about the abuse of power by the executive. The snooping scandal is murkier, and seems to have involved an abuse of power.

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