What to do When a Power of Attorney Is Abused

One of the best things you can do in prepare a durable financial or general power of attorney (POA) so that someone you trust can pay your bills and conduct your business in the event of your disability. We often help our clients in Tempe, Mesa, Chandler, Scottsdale and San Tan Valley to prepare these important documents. Without this document you run the risk that your family will need to pay for an expensive guardianship or conservatorship. Usually the spouse or life partner is the first choice to be the trusted person holding the POA. We encourage our clients to name at least 1 or 2 successors as well, which often are their children.

Assuming you have created a valid financial or general power of attorney (POA) and given it, or a copy of it, to a person you trust, what do you do if that person violates your trust and abuses the power of attorney. The person holding the power of attorney is called the “attorney in fact”. They are a fiduciary and are held to strict standards under Arizona law. But what happens if they use the POA to enrich themselves at your expense? What happens if they take money in your bank account for themselves, or sell your property without your consent?

There are many steps to take if this happens. You should first seek the advice of legal counsel. There are both civil and criminal cases that can be made against the attorney in fact. You also need to stem the bleeding and stop their misconduct immediately by executing a written revocation of the POA, most likely recording it with the county recorder and also promptly providing it to anyone (bank, title company, auto dealer, etc) that has been dealing with the attorney in fact. You should also take appropriate steps to notify the attorney in fact that what they have done is wrong and that you expect that they will take the action necessary to undo their wrongdoing, such as returning money that does not belong to them.

The best thing that you can do is to avoid giving a POA to anyone who you suspect MIGHT abuse it. When you give the power of attorney, you are giving the attorney in fact real power to make your life better, or, if abused to make your life much worse. Such power should be given carefully, and with awareness.

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