Monday, May 23, 2011
Elder law attorneys and prosecutors have witnessed an increase in the number of cases in which elder parents are taken advantage of by their adult children through the use of powers of attorney. In fact, many banks now refuse to honor powers of attorney because of the possibility of becoming a party to fraud.
In 2007, philanthropist Brooke Astor’s son attempted to take money from her through a power of attorney. He was convicted of grand larceny in 2009 for stealing over $1 million from his mother. MetLife estimated in 2009 that elder individuals lose $2.6 billion annually as a result of elder financial abuse.
Legislatures are attempting to put a stop to this problem with the introduction of a bill that would create an Elder Abuse Victims Act. Local and state lawmakers are also attempting to curtail this elder financial abuse.
Nine states have adopted the Uniform Power of Attorney Act which grants bank employees more protection from civil suits, giving the employees more discretion when deciding whether or not to honor a power of attorney. Additionally, many brokerages and banks are creating heightened restrictions for power of attorney claims, rejecting documents that are outdated.
"'n the old days, a strongly worded poison-pen letter threatening a lawsuit would work," says Kristen Lewis, an estate-planning attorney with Smith Gambrell & Russell in Atlanta. "But in recent years, it has not done the trick."
Kelly Greene and Jessica Silver-Greenberg, Power Grab!, The Wall Street Journal, May 14, 2011.
Special thanks to Jim Hillhouse (Wealth Counsel) for brining this article to my attention.