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Currently, over 55 million people live with dementia worldwide. This condition involves memory loss mainly from Alzheimer’s or Parkinson’s disease and is more prevalent among older adults, particularly those above 65.
Patients living with dementia may require someone to make financial decisions on their behalf, which exposes them to the risk of financial abuse.
Statistics show that one in every three senior adults dies with Alzheimer’s or another condition that causes dementia. One way of helping to prepare for life with dementia is giving power of attorney to a person they can trust with their care and finances.
Power of Attorney and the Law Governing the Process
Different states have varying laws concerning when a person can legally sign over power of attorney based on the state’s definition of mental competency. When navigating the transfer of attorney process, it is important to seek the help of an attorney to ensure that the transfer is legally binding.
Transferring power of attorney is very sensitive because it involves delegating more than bank accounts to include power over a person’s trust or estate. For this reason, the law is stringent, allowing transfer only when the person is legally competent to protect the principal from financial abuse.
Suppose signing over the power of attorney document occurs when the older person is not mentally competent. In that case, such actions can constitute fraud, theft crimes, and elder abuse if challenged in court. However, that does not mean it all is lost if the older adult is past the stage where they cannot legally transfer power of attorney. In such cases, an attorney can guide the elderly through the guardianship or conservative route.
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Abuse of Power Of Attorney/Elder Financial Abuse
The law requires that the person assuming power of attorney over another person act in their best interests. But this does not always happen. “There is very little regulation on those with power of attorney,” says David Benowtiz of Price Benowtiz. This lack of regulations means that people with power of attorney can abuse their power for years without anyone’s notice. Misappropriation of funds or a breach of trust after the principal is no longer legally competent constitutes elder financial abuse.
A person wishing to sign over their power of attorney is not limited to signing it over to a family member. They can sign it over to a lawyer or someone that they trust.
No matter the person to whom a power of attorney is signed over, it must not be a two-person affair for accountability purposes. It would be best to involve all family members and dependents whenever possible.
If You See Something, Say Something
One sign of elderly abuse you may want to be on the lookout for is unexplained bank withdrawals or transfers. Another sign that something may be wrong is if the person with power of attorney is secretive with bank statements or intentionally isolates the principal from other family members.
If you have a suspected elder financial abuse case, it is important to notify the necessary authorities, such as the police or elderly advocacy groups.
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