{"id":785,"date":"2019-12-01T02:00:17","date_gmt":"2019-12-01T07:00:17","guid":{"rendered":"https:\/\/www.deeds.com\/articles\/?p=785"},"modified":"2024-04-25T23:20:32","modified_gmt":"2024-04-26T03:20:32","slug":"fraud-scams-and-power-of-attorney-problems","status":"publish","type":"post","link":"https:\/\/www.deeds.com\/articles\/fraud-scams-and-power-of-attorney-problems\/","title":{"rendered":"Fraud, Scams, and Power of Attorney Problems"},"content":{"rendered":"\n
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More than a\nthird of the U.S. population is now in the over-50 set. As the\nseniority trend continues, expect the rate of financial\nexploitation to rise accordingly. Be aware. Keep tabs on what elders\nneed to look out for. Here, we review the kinds of financial manipulation\nhappening on a large scale today. <\/p>\n\n\n\n\n\n\n\n

Low\nOffers From Opportunistic Home Buyers <\/h2>\n\n\n\n

It can\nhappen to anyone. The longer you’ve owned a home, the more likely it is\nto happen to you. As you read this, sneaky home purchasers are scouring\nthe public property records for homes with low assessed values.\nThey’re looking for homes likely to be owned by older people.<\/p>\n\n\n\n

Next come\nthe mailings and calls, containing urgent offers. Are you\nready to sell for this big chunk of money? Some offers come with\nall the paperwork, and instructions on where to sign.<\/p>\n\n\n\n

Swindlers\neven knock on doors, or seek out their marks in churches. These\nmanipulators are betting that at least some of their targets will sign the\nagreement to sell\u2014without checking their homes’ current values.\nBy the time a hoodwinked homeowner understands what happened,\nthe deed, so to speak, is done. <\/p>\n\n\n\n

Pressure\nFrom Inside the Circle<\/h2>\n\n\n\n

Ultimately, age makes us all vulnerable. So,\u00a0we hear about\u00a0family members pressing older relatives to transfer the titles to\u00a0their\u00a0homes. Or maybe the\u00a0pressure comes\u00a0from a\u00a0gardener who helped an elder after a fall.\u00a0Maybe it’s a financial advisor the elder has known for decades. Trusted relatives, friends, and healthcare providers\u00a0are all in positions of influence\u2014for better or for worse. Indeed,\u00a0nine out of ten<\/a> exploiters of an elder’s assets are relatives, trustees, or financial advisers.<\/p>\n\n\n\n

Undue influence <\/em>occurs when a\u00a0person in a position of trust overrides the vulnerable\u00a0person\u2019s best interests. It is “often linked to impaired cognitive capacity,” the American Bar Association<\/a> tells us. Yet\u00a0the influenced person may\u00a0have\u00a0sufficient legal capacity to make a binding agreement.\u00a0<\/p>\n\n\n\n

It’s often\nhard to tell when influence crosses that line to undue. <\/em>To make\nmatters murkier, undue influence typically happens behind closed doors.<\/p>\n\n\n\n

Sometimes\nthe older person gives away decision-making authority to the wrong person,\nthrough a legal vehicle known as power\nof attorney.<\/em><\/p>\n\n\n\n

When\nthe Power of Attorney Backfires<\/h2>\n\n\n\n

Often\naccompanying a will, a power of attorney (POA) names a relative,\nfriend, or adviser as an agent. If a person (called the principal<\/em>) loses the\ncapacity to make binding agreements, the power\nof attorney is vital<\/a>. That said, choosing an agent can backfire\non the best of us.<\/p>\n\n\n\n

Where allowed by law, some powers of attorney are drafted so someone\u00a0else monitors<\/a> the use of the power. Some states use their laws to limit potential POA abuse.\u00a0In New York, for example, both the principal\u00a0and agent must sign the POA.\u00a0If the agent is expected to sell real estate or make large annual gifts to anyone, specific permission<\/a> must be signed in front of two witnesses.\u00a0Many states allow for performance reviews, or financial accountings handled by third-party accountants. \u00a0<\/p>\n\n\n\n

What if an exploited elder has already passed away before the trouble was caught? Check state law. California\u00a0probate laws, for example, treat a\u00a0beneficiary who exploited the deceased person as having predeceased<\/a> the elder. The cheater may not continue acting as an agent, or\u00a0collect anything from the estate.\u00a0\u00a0<\/p>\n\n\n\n

Definitions:\nPowers of Attorney<\/h2>\n\n\n\n

General\npowers of attorney<\/strong> give an agent wide authority to handle the\nprincipal’s transactions, small or large. Actions can include taking items from\na safe, agreeing to a home sale, obtaining personal data, and applying for\nloans or insurance.<\/p>\n\n\n\n

Limited\n(“special”) powers of attorney <\/strong>authorize a\nparticular transaction. For example, it can be difficult to buy a\nhome from a remote location, as the notary will need to adhere to two sets\nof laws. But because having an agent handle a large\npurchase involves risk, an absent buyer is well advised to hire an\nattorney in the town where the home is, to oversee the transaction.\nLenders require specific language (such as minimum sale price) when a\npower of attorney authorizes a home purchase. <\/p>\n\n\n\n

A durable power of attorney <\/strong>continues\nin effect if the principal becomes incapacitated. A non-durable power of attorney <\/strong>does\nnot. Typically, a nondurable power of attorney is used for a specific\ntransaction\u2014for example, in the principal’s absence. <\/p>\n\n\n\n

The springing power of attorney<\/strong>,\nwhere allowed by law, takes effect when the principal is\ndeemed incapacitated. This allows another person to sell the home\nwhen its owner no longer can. <\/p>\n\n\n\n

POA\nPitfalls to Anticipate<\/h2>\n\n\n\n

Watch for\nthe following situations:<\/p>\n\n\n\n