Managing Someone Else’s Money Under a POA

POAOne of the ways to avoid having a guardianship imposed is to have an effectively working “lesser restrictive alternative” in place.   A power of attorney is an example of a lesser restrictive alternative.  Although, it is important to note, that the power of attorney does NOT automatically mean that a guardianship will be avoided.  It can be misused or not used at all.  It can be revoked.

If there is a power of attorney in place, it is important that the person acting under the authority given by it, follow some basic rules/guidelines.  The  Consumer Financial Protection Bureau has released a guide called “Managing Someone Else’s Money: Help For Agents Under a Power of Attorney”.  It is a great resource.  It sets forth, in very basic, understandable language, what a power of attorney is, what a person’s duties are under the power of attorney, how to recognize financial exploitation, and contact information for varioius agencies that deal with exploitation.

The 4 basic duties of an agent acting under a power of attorney for a principal (the person granting the power):

  1. Act only in the Principal’s best interest.
  2. Manage the Principal’s money carefully
  3. Keep the Principal’s money and property separate from your own
  4. Keep good records

Check out this great resource for more details!

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