Sadly, abuse, neglect, and fraud of the elderly is all too common in the United States. Even by conservative estimates, over two million incidents of elder abuse and neglect occur each year. Although most people associate abuse with physical or emotional abuse, financial abuse is also very common. The elderly are often dependant on caregivers to take care of many day to day financial transactions which can lead them to give the caregiver more control than they should over their finances. Abusers often use a common estate planning tool, the power of attorney, to gain unfettered access to an elderly individuals finances with often devastating results. Why are powers of attorney so easy to use as a tool to defraud?
A POA is relatively simple to create. Locating a generic POA form usually only requires a few keystrokes on a computer.
Most people have heard of a POA and consider it to be a common, legitimate, legal document. This familiarity with the form often makes an elderly victim less suspicious and therefore more willing to sign the document.
A POA can be created for a specific purpose, such as to give someone the legal authority to act on your behalf to complete the sale of your vehicle. A broad POA, on the other hand, can give someone access to all of your assets and financial accounts. Many victims sign a POA under the impression that the authority they are granting is narrow, when in fact it is very broad.
Once a perpetrator has a signed POA in hand, he or she can wipe out an account or transfer property into his or her name in record time, making it a very easy and quick way to commit fraud or theft.
Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.