“With great power comes great responsibility” – Voltaire

The Power of Attorney document is a very critical estate planning tool that allows a person (the “principal”) to appoint someone else (the “agent”) to make important decisions, such as financial transactions, access to bank accounts, contracts, etc. Under a General Durable Power of Attorney, the appointed agent’s authority does not “kick in” until a principal is deemed incapacitated (the inability to make major decisions, care for oneself, loss of average daily living skills, etc.). At this time, the agent is then responsible for making major financial decisions, gaining access to bank records, and monitoring bank accounts, as well as selling real estate, signing contracts, and purchasing property on behalf of the principal. Typically, the principal appoints a person whom they trust, such as a spouse, oldest child, caregiver, or another relative to be their agent on the Power of Attorney.

The appointed agent is required to act in the best interests of the principal, and thus, make all major financial decisions solely to benefit the principal. However, there have been a number of cases where the appointed agent has taken advantage of the principal due to their authority under the Power of Attorney, such as emptying bank accounts, purchasing new vehicles and personal property on the principal’s account, and taking out credit cards in the principal’s name. What happens when it is discovered that the agent has been abusing their authority under the Power of Attorney document? What remedies do you have when your agent has been stealing money from you?

The most common example of this occurs when family members realize that the appointed agent (usually another family member) has been staying with the elderly adult and “taking care of him/her,” yet it is discovered that the elderly adult’s accounts have been depleted, there are several new accounts in his or her name, or there is a large increase in consumer debt in his or her name. Generally, these are clues that the appointed agent has been financially abusing the principal and has been using the Power of Attorney document to do it.

If you or a family member discover that an agent has been abusing their authority under the Power of Attorney, there are a number of remedies that you can pursue in order to hold the agent responsible and undo the damage. If you are still mentally able to understand what you are doing and you believe your agent is not acting in your best interests, you can revoke the Power of Attorney.  You should notify the agent that he or she is no longer authorized to act on your behalf.  You should also notify any bank or other institution with which your agent may have done business for you so that they know the agent is no longer authorized to handle your business. Additionally, under Code of Virginia § 64.2-1612(H), you can request your agent to give a full accounting of all property or interests entrusted to the agent, as well as a record of all financial transactions that the agent has performed.

Importantly, under Code of Virginia § 64.2-1612(I), any other person interested in your welfare (for example, a family member or a co-agent), can also make a written request to your agent asking him or her to disclose any actions taken on your behalf within the past five years and to allow reasonable inspection of records about these actions.  If the agent refuses to comply with this request within 60 days, the person interested in your welfare can bring a case in circuit court to get a court order requiring the agent to provide the requested records. This provision is a very helpful tool for other family members that are not listed on the Power of Attorney, yet suspect that the agent is taking advantage of the parent.

Finally, you could also file a case in circuit court seeking an accounting from your agent. This is a more formal and legal avenue to pursue against your agent, but will still result in your agent having to disclose their transactions, records, and purchases for the principal. Additionally, family members can seek help from the local authorities and Department of Social Services – Adult Protective Services if they suspect financial abuse against an elderly adult.

In conclusion, you should be aware of the authority that you confer upon your agent when you execute a Power of Attorney document. Additionally, when it appears that your agent has been abusing their authority and taking advantage of the principal, other family members should be aware of the remedies and procedures available in order to investigate the agent. Finally, if you do suspect that an agent is misappropriating funds or financially abusing the principal, please contact our office so that we provide further details on these remedies!