Abuse Of Power Of Attorney After Death

We all need a bit of financial security in our lives. Things may be fine now, but you need to account for the possibility that you’ll become incapacitated at one point and won’t be able to make your own decisions.

This is where a power of attorney comes in. This document allows you to appoint someone you trust to manage your legal and financial affairs on your behalf, which can be useful if you become incapacitated.

While all of that is very beneficial, since you’re providing someone with such a level of decision-making ability, there’s a chance they’ll attempt to abuse this power after you pass away.

In the next few minutes, we’ll delve into the abuse of power of attorney after death in more detail, including how you can protect yourself from such a scenario.

What Constitutes an Abuse of Power of Attorney After Death?

Abuse occurs when an agent of a power of attorney misuses their authority after the principal passes away. Despite the fact that power of attorney automatically expires after death, fraudulent individuals may attempt to forge documents, sign contracts, and otherwise misappropriate assets to serve their interests.

Although no one is completely sure their agent won’t do this, individuals without an estate plan in place are especially susceptible to abuse of power of attorney after death.

Types of Power of Attorney Abuse

The exploit of power of attorney comes in different forms, most commonly:

• Misappropriation of principal’s assets - refers to a situation where an agent uses the expired power of attorney designation to transfer assets to their name
• Fraudulent activity - includes creating fake documents, signing contracts, or forging signatures
• Unauthorized transactions - include everything from selling the principal’s property to making investments
• Gifting assets - similar to other unauthorized transfers of assets, the agent may try to gift assets without permission to serve their needs

These instances aren’t obvious and the decedent’s family may go years without discovering that some assets from the estate are missing.

Legal Repercussions of Power of Attorney Abuse

There are severe consequences to abusing the power of attorney after death.

Anyone found guilty of this behavior could face civil and criminal charges. The repercussions may include fines, incarceration, or a combination of the two.

Most of the time, the court will enforce restitution for any losses incurred by the abuse of power of attorney. In other words, the fraudulent agent will be required to restore or pay back any of the principal’s assets they have misappropriated.

The deceased individual’s assets will also experience challenges due to the agent’s fraudulent activities. The assets may not only be depleted, but it may also become difficult to distribute them correctly. The end result can be a hefty delay in the probate process or even a total loss of assets.

In extreme cases, the heirs may also have to pay out of pocket to resolve the issues surrounding the estate.

How To Protect Yourself From Abuse of Power of Attorney After Death

While you can’t completely erase the possibility of abuse after you pass away, you can take proactive steps to protect your estate from the power of attorney abuse.

These include:

1. Choose the right agent

To minimize the potential of abuse, you need to choose an individual whom you fully trust and who has a deep understanding of the responsibilities you provided them with. This could be a family member, a close friend, or a qualified legal professional.

2. Set clear power of agent terms

A fraudulent agent will typically start abusing their power while the principal is still allowed. This is why you should set clear terms in the power of attorney agreement and implement instructions on what the agent is allowed to do. Consult an attorney to check whether any of the procedures you put into effect are compliant with Florida law.

3. Make sure someone monitors the agent and your assets after death

When you create a power of attorney document, you should hire an estate planning attorney and instruct them to monitor all financial statements regularly. This is done to confirm whether the agent is taking unauthorized actions of any kind.

When protecting your estate from abuse of power of attorney after death, you can assign an independent fiduciary to manage your estate or set up a trust to prevent fraud or misappropriation of assets.

4. Assign a co-agent

The best way to prevent abuse is to assign a co-agent. This ensures that none of the agents can make major transactions or decisions unless they’re both in agreement.

The only downside to this is that it can slow down important decisions when you’re incapacitated.

An alternative approach is implementing a rule of two signatures. The agent will be able to act on their own when it comes to smaller transactions but will require a second signature for major decisions or transfers of property.

Taking these steps minimizes the possibility of an agent mishandling their legal capacity as a representative and wasting away assets that rightfully belong to your family.

Consult an Estate Planning Attorney Now

Abuse of power of attorney after death is a serious offense. Still, some individuals may succeed in snagging your assets as soon as you pass away. This is why hiring an estate planning attorney is necessary.

A legal professional has the necessary expertise to advise you on methods of protecting your estate from mismanagement or fraudulent activities. Furthermore, they can also provide you with peace of mind knowing your wishes will be respected after death and none of your heirs will accidentally be disinherited due to a legal technicality.

Regardless of your goals, the legal professionals at the Law Offices of Mary E. King can assist you with all your estate planning needs. We have over twenty years of experience in this legal field and can help you establish a power of attorney that is impervious to abuse, as well as introduce you to other legal instruments that make certain your wishes are respected after you pass away.

Schedule an appointment by calling 941-906-7585 or filling out our contact form.

Note:

The information in this blog post is for reference only and not legal advice. As such, you should not make legal decisions based on the information in this blog post. Moreover, there is no lawyer-client relationship resulting from this blog post, nor should any such relationship be implied. If you need legal counsel, please consult a lawyer licensed to practice in your jurisdiction.