Trust or Consequences: The Downside to Powers of Attorney

by labrelawoffice

English: Power of attorney for Abram Ioffe by ...

English: Power of attorney for Abram Ioffe by Vladimir Lenin to represent USSR with Estonia. Русский: Доверенность, выданная В.И.Лениным Абраму Иоффе на представление РСФСР в переговорах с Латвией, Литвой и Эстонией. (Photo credit: Wikipedia)

He was eighty.  His son had brought him to my office.  “My Dad’s got a big problem”, he said.  “His girlfriend has just ripped him off and took all of his money!”

“She’s not my girlfriend, you young whipper snapper!  She’s just a wonderful girl who takes care of me.  A lot better than you do, too, if I do say so myself.”

“Right, Dad”, he said, turning to his father.  “That’s why she just took over $200,000 from your bank account.”

“Wait a minute”, I said.  “How did she withdraw all of that money from the bank?  Was it a joint account?”

“I wouldn’t do that”, his dad replied.  “I’m not that dumb.”

“OK.  So, how did she get access to your bank account?”

“You tell him, Dad, or I will.”

“You see, it’s like this”, his father said.  “My son, he lives in the Upper Peninsula.  It’s hard for him to come all the way down here.   But I can’t do everything for myself anymore.  I need some help.  So I hired a housekeeper to help me.”

“She helped you, all right,” his son muttered.

“Well, as I was saying, she began to help me.  She even helped me write out my monthly bills.  I’d sign a check, and she’d go get my groceries.   She’s really very nice.”

“OK.  So, how did she get access to your bank account?”

“Well, about a month ago she suggested that it would be a lot easier if she had a power of attorney.  That way she could just take care of things for me.  She brought me to an attorney, told him what I wanted, and he drafted the papers and I signed them.  No big deal.”

“Did she take your money?”


“Oh yes she did, Dad!  Here’s a copy of the $200,000 check she wrote to herself which cleaned you out.”

“She wouldn’t do that”, his Dad insisted.  “It’s probably just a loan.”

“If it’s ‘just a loan’, then where has she been the last week?”

“She said that she was going to visit her sick mother.  Isn’t that nice?”

“Where is she now?” I asked.

“With her mother.”

“Where’s is her mother?”

“Out West somewhere.”

“Do you have a phone number?”

“No, I don’t”, as a puzzled look came over his face.

“I’ll be surprised if you see her again”, I said.  “What you’re telling me is a far too common story.  I’ve seen children do this to their parents, brothers do it to their sisters, nieces do it to their aunts.”

“It usually starts out as a ‘small loan’, but the easy money is just too easy.  The owner doesn’t even know it’s happening, or else makes excuses.  After all, it’s usually the person whom the elderly and lonely soul trusts and upon whom the person depends.”

“Isn’t there anything we can do?”

“Well, first, I need to read the power of attorney.  The person who has the power, called an ‘attorney in fact’, is prohibited by Michigan Law from engaging in self-dealing unless the power gives that authority.  I’ve seen some lawyers, though, who give that authority in the document.”

“Assuming that that the authority to make gifts to yourself is not in the document, then you would need to do the following:

“First, you need to sign a document called “Revocation”, and mail that document both to the attorney in fact, record it with the Register of Deeds if you own land, and give a copy to every financial institution so that the power is not used.”

“Then you demand a return of the money.  You can even sue for three times the amount of money which was stolen from you.  Unfortunately, once the money has been taken, it’s usually spent and there’s nothing left to collect.

“Finally, you need to report the theft to law enforcement.  If you can’t get your money back, at least they can think about the theft from behind bars.”

“But shouldn’t everyone have a Power of Attorney?” the father asked?

“No, as a matter fact, everyone shouldn’t.  A Power of Attorney is literally a blank check.  You don’t trust someone that much unless you’re absolutely certain that the person is completely trustworthy.  If you’re wrong about the person, you can be wiped out.”

“I’m beginning to see that”, he said.