Wrong POA? Sobering Information

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HGTVFanatic

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If you have a Power of Attorney that includes Vanguard and USAA, read the article on page 30 of the August/September AARP Magazine. Very scary and eye-opening. It’s about a woman who couldn’t access her mother’s accounts because she didn’t have the right kind of POA. Mother has dementia. It is pretty disturbing.
 
I have POA for my mum’s accounts at USAA and Vanguard. We made sure they were registered and valid with each of those institutions when the POAs were first filed. Vanguard accepted her POA, not sure why Vanguard didn’t accept the POA mentioned in the AARP story.

It does make sense to verify any POA with the institution before it is needed.
 
MichaelB said:
I have POA for my mum’s accounts at USAA and Vanguard. We made sure they were registered and valid with each of those institutions when the POAs were first filed. Vanguard accepted her POA, not sure why Vanguard didn’t accept the POA mentioned in the AARP story.

It does make sense to verify any POA with the institution before it is needed.
Click to expand...

This is true.

When one of the local banks gave me issues about my father's POA - I insisted they contact their legal department and fax over a copy. Thereafter, the objections vanished.
 
HGTVFanatic said:
If you have a Power of Attorney that includes Vanguard and USAA, read the article on page 30 of the August/September AARP Magazine. Very scary and eye-opening. It’s about a woman who couldn’t access her mother’s accounts because she didn’t have the right kind of POA. Mother has dementia. It is pretty disturbing.
Click to expand...

The solution for Vanguard is to use Mom's DPOA to setup account(s) for her at Fidelity then have Fidelity initiate an in-kind ACAT transfer from Vanguard.

Since Fidelity is much more flexible on DPOAs than Vanguard, though others might prefer other brokerages equally as accommodating.

If the USAA accounts are simply bank accounts then add them as external accounts to Mom's Fidelity taxable account and transfer Mom's funds out of USAA that way.
 
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MichaelB said:
I have POA for my mum’s accounts at USAA and Vanguard. We made sure they were registered and valid with each of those institutions when the POAs were first filed. Vanguard accepted her POA, not sure why Vanguard didn’t accept the POA mentioned in the AARP story.

It does make sense to verify any POA with the institution before it is needed.
Click to expand...
Exactly!

Moral of the story would be - when you first set up the POAs and the elder in question is lucid, go ahead and send them to any financial institution that needs them, and jump through the hoops up front.

MarieIG said:
This is true.

When one of the local banks gave me issues about my father's POA - I insisted they contact their legal department and fax over a copy. Thereafter, the objections vanished.
Click to expand...
Also an excellent point.
 
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audreyh1 said:
Exactly!

Moral of the story would be - when you first set up the POAs and the elder in question is lucid, go ahead and send them to any financial institution that needs them, and jump through the hoops up front.


Also an excellent point.
Click to expand...

Vanguard wants you to fill out a special form found on their website. No others accepted.
 
One thing to keep in mind is that a POA is a necessary, but not necessarily sufficient device to have institutions deal with you. Some will not honor any POA and that is the business' choice.

A court-appointed guardianship/conservator-ship, on the other hand, must be honored by law. At least that is my understanding on all this.

-gauss
 
I completed all the paperwork required, got a medical doctor's blessing and a lawyer to provide me a POA for my father and Vanguard still would not allow me to open up a custodial account for my father. They said I would need to go to court to get permission. I said, no thank you. Needless to say, I went elsewhere.

I have a POA for the VA, Wells Fargo, sold his house and everything else, but not Vanguard....haha....
 
I've just recently been through this with my DF's bank and brokerage accounts. Despite having a signed, notarized DPOA, it took several weeks and multiple in-person visits to one bank in particular to get the POA in place and "working". They would not accept the POA as written and required me to fill out a custom POA form, which then had to be faxed and reviewed by their internal legal team. Ultimately, I did get full access, but it took WAY longer than anticipated and was not at all straightforward. Some banks and brokerages are much, much easier than others to deal with when it comes to POAs. And they all seem to have very different approval processes, which I found quite surprising... and frustrating.
 
gauss said:
One thing to keep in mind is that a POA is a necessary, but not necessarily sufficient device to have institutions deal with you. Some will not honor any POA and that is the business' choice.

A court-appointed guardianship/conservator-ship, on the other hand, must be honored by law. At least that is my understanding on all this.

-gauss
Click to expand...

while banks/brokerages might be required by law to recognize a court-appointed conservatorship, many do not. I have first hand experience with Wells Fargo, Discover Bank, and several local banks recommended by the attorney that handled the conservatorship. The institutions did not recognize the court-appointed conservatorship at all or required a lot of gymnastics with their legal departments and their own custom forms.


While conservatorship is supposed to be the bigger hammer, many are unfamiliar with it and even confuse conservator (financial) with guardian (medical/personal care). They are mostly familiar with a POA.


I had both a POA and conservator/guardianship for dear old Dad along with co-trustee of the trust and joint owner of his checking account and STILL wound up with a lot of hassles in getting institutions to comply. Discover Bank never did get it straightened out so while we did not have full control of the account, we were able to transfer funds out. So that account is sitting there going no where with a $0.03 balance (couldn't get it to zero).


It sounds like overkill, but different institutions are going to capitulate to different tools. POAs, co-trustees, joint account ownship are cheap/easy and should always be in the tool box. Conservatorship/guardianship gets expensive (especially when contested), but does carry some weight some times.
 
I had POA for my friend because she had dementia and her husband was dying. I had so much trouble using it that I just started conducting all business by phone pretending that I was her. It worked really well.
 
Some states, including mine, have laws where one can sue an institution which does not accept a POA which meets (some very basic) state legal requirements.

Even so, it could be a royal pain to go through the hassle with some places.

I just did this whole process about 20 times with my Dad's stuff. Quite a variety of responses,and it was surprising which were strict and which were easy.
 
Fidelity is just as bad. Dad executed a POA when he was still of sound mind giving power to two of my brothers to handle his finances. It was executed by a lawyer in the state where Dad lived. When Dad was in LTC and failing Fidelity refused to accept it. They had to get two docs at the facility to certify that Dad was non compos mentis. Very hard on my brothers to see that in writing.
 
Another problem with a POA is time... I had POA for my mom along with other docs when she was in her 60s.... she lived to 99.9...


When I put her condo up for sale it was hard to get a title company to recognize the POA... I found it funny that some suggested that I get a new one even though mom was not competent... she seemed to be if you talked to her but she was not...


I eventually found a broker that talked to the lawyers who agreed to let me sell the place for her... but they also knew I was to be executor...
 
Texas Proud said:
Another problem with a POA is time... I had POA for my mom along with other docs when she was in her 60s.... she lived to 99.9...


When I put her condo up for sale it was hard to get a title company to recognize the POA... I found it funny that some suggested that I get a new one even though mom was not competent... she seemed to be if you talked to her but she was not...


I eventually found a broker that talked to the lawyers who agreed to let me sell the place for her... but they also knew I was to be executor...
Click to expand...

Yeah, I used a POA to sale my father's house in AZ. This was a year ago. I had no issue. I have wondered if I needed a POA in OR where he now resides. With this said, the facility has accepted the original. If I remember correctly, the POA does have a expiration date for the notary. This may bring an issue as well. So, I do not know myself, and perhaps others can chime in if a POA needs to be completed after a period of time.

I personally have taken over my father's finances completely. I chose this since if anything occurs I do not need to liquidate accounts under his name. I simply have his funds. I do have custodial account with Wells Fargo with both our names to receive pensions. Originally, to get all of this it was a pain, but I have it dialed in now.
 
Harris4crna said:
Yeah, I used a POA to sale my father's house in AZ. This was a year ago. I had no issue. I have wondered if I needed a POA in OR where he now resides. With this said, the facility has accepted the original. If I remember correctly, the POA does have a expiration date for the notary. This may bring an issue as well. So, I do not know myself, and perhaps others can chime in if a POA needs to be completed after a period of time.
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If it's durable, then it lasts until the principal revokes it.

The notary's expiration is on there just to show that they were an official notary when the document was notarized. After that it doesn't matter AFAIK.

I'd consider getting a new one for the state where he lives if you anticipate any future need (and future need is hard to predict). My Dad's two (yes, I have two) both reference his state of residence and are to be construed under his state's laws. State laws can differ with respect to POAs, so what your AZ POA means you can do may not be true under OR law. Of course, IANAL.
 
Harris4crna said:
Yeah, I used a POA to sale my father's house in AZ. This was a year ago. I had no issue. I have wondered if I needed a POA in OR where he now resides. With this said, the facility has accepted the original. If I remember correctly, the POA does have a expiration date for the notary. This may bring an issue as well. So, I do not know myself, and perhaps others can chime in if a POA needs to be completed after a period of time.

I personally have taken over my father's finances completely. I chose this since if anything occurs I do not need to liquidate accounts under his name. I simply have his funds. I do have custodial account with Wells Fargo with both our names to receive pensions. Originally, to get all of this it was a pain, but I have it dialed in now.
Click to expand...


Yea, it is what we did also... got my name on my mom's checking account... a trusted person on her accounts or just logged in as her when needed... the few times I needed to get by on phone my oldest sister sub for mom as she knew all the answers... and then said 'you can talk to my son'....



Well, almost all... one call they wanted to know her address 'on file'... which we later found was back in the early 1940s but they never told us the year... we knew addresses back to the mid 1950s so it was a struggle to get this...
 
I'll repeat my general advice on this stuff:

1. Simplify if you can. Get from 20 accounts to six means you only need to deal with the POA thing six times instead of 20.

2. Get online or electronic access set up (better to do this as POA, but obviously many will just grab Dad's user/pass from them). Far easier to log into a website to transact as needed than to call in and do the whole authentication process.

3. Start way before you need. My Dad signed his first POA in 2017. He was diagnosed with dementia earlier this year. Having the POA already in place saved me a lot of trouble.

4. Do dry runs. Since it's questionable if my Dad is of sound mind now (probably yes, but some days maybe not), I'm glad I've already logged in everywhere and get statements and bills sent to me now and can monitor his SS and his pension. I'd hate to assume "Oh, I can get SS to change his address" and then find out when it was really necessary and urgent that there is some sort of issue that would take more time or be impossible.

As a side note, all the medical POA and living will or POST or whatever they call the forms in your area are also critical to have in place. If Dad's having a stroke that's not the time to be looking for paperwork that isn't there or isn't signed or understood. My Dad's paperwork is all scanned in and on file with the local hospital system and his doctor and I'm his "healthcare proxy". Makes doing healthcare stuff (it's vaccine time this week) much easier.
 
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One other thing about POAs that came up at the court hearing for my dads conservatorship:

A POA doesn't remove a dementia patients ability to do what ever they want with their $. A POA creates a tie between the POA and the patient... with the institution caught in the middle.

Dad's attorney at the competency hearing called me to the stand and asked why the competency hearing and wasn't a POA enough... so I related the story of what happens with POA "tie" when the dementia patient won't let go.

In my case, Dad had turned over admin of his rental properties to me. He wrote letters to the property managers stating such.
He then forgot he had put me in charge and started giving conflicting directions to the property manager (it got real complicated here when Dad hired one of his tenants to be his home health aide... who was already a registered offender with the state Adult Protective Services agency). Dad fired the property manager for trying to evict the tenant.



The trigger for the emergency protection order was Dad was trying to give the tenant/home health aide the rental house in return for a promise that they would take care of him until he died (he has an unlimited LTC policy).

The judge granted the guardianship and the conservatorship. But we still burned $80K on the process that we thought was handled by the trust. The trust stated "when a Dr states I am no longer capable". Dr's wont' get involved. Since Dad wasn't naked in the front yard barking at the moon the Drs stated "he's still making decisions. They are just bad decisions".
 
audreyh1 said:
Exactly!

Moral of the story would be - when you first set up the POAs and the elder in question is lucid, go ahead and send them to any financial institution that needs them, and jump through the hoops up front.


Also an excellent point.
Click to expand...



What does this look like, practically? Meeting with management at the bank? Getting written approval from them? I started looking at my state and it seems they have reforms in place to prevent banks from arbitrarily refusing. My impression is some banks only want to accept a court order or their own POA. Heck, BOA was a hassle to just designate beneficiaries.
 
jazz4cash said:
What does this look like, practically? Meeting with management at the bank? Getting written approval from them? I started looking at my state and it seems they have reforms in place to prevent banks from arbitrarily refusing. My impression is some banks only want to accept a court order or their own POA. Heck, BOA was a hassle to just designate beneficiaries.
Click to expand...

No, you simply call the financial institution, identify yourself and the account holder and relationship, and explain you have a POA and arrange to send it to them. At that point they’ll let you know if other forms are required. Get those done and submitted. Follow up. Often they have a legal department review everything. All my stuff I did by phone and upload or mail.

They should then have it on file for the account holder. They may have to check whenever you call in again.

I dealt with a pension company, benefits company, brokerage and a local bank. The last was straightforward as my name was also on DF’s checking account and for safe deposit box access, but they still appreciated having a copy of the POA.
 
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SecondCor521 said:
As a side note, all the medical POA and living will or POST or whatever they call the forms in your area are also critical to have in place.
Click to expand...

+1 especially for the oft-overlooked POLST form. I first learned about it here at E-R.org, and after looking into it realized it's actually just as important as having a living will, advanced healthcare directive, etc.

From the polst.org website:
A POLST form helps individuals with serious illness or frailty for whom their health care professional wouldn’t be surprised if they died within a year communicate their treatment decisions. It is designed to improve patient care by creating a portable medical order form (the POLST form) that records patients’ treatment wishes so that emergency personnel know what treatments the patient wants in the event of a likely medical emergency, taking the patient’s current medical condition into consideration. The current standard of care during an emergency is for emergency medical services (EMS) to attempt everything possible to attempt to save a life. Not all patients who are seriously ill or frail want this treatment and the POLST provides the option for them to: (1) confirm this is the treatment they want or (2) to state what level of treatment they do want.
Click to expand...
 
Spock said:
One other thing about POAs that came up at the court hearing for my dads conservatorship:

A POA doesn't remove a dementia patients ability to do what ever they want with their $. A POA creates a tie between the POA and the patient... with the institution caught in the middle.

Dad's attorney at the competency hearing called me to the stand and asked why the competency hearing and wasn't a POA enough... so I related the story of what happens with POA "tie" when the dementia patient won't let go.

In my case, Dad had turned over admin of his rental properties to me. He wrote letters to the property managers stating such.
He then forgot he had put me in charge and started giving conflicting directions to the property manager (it got real complicated here when Dad hired one of his tenants to be his home health aide... who was already a registered offender with the state Adult Protective Services agency). Dad fired the property manager for trying to evict the tenant.



The trigger for the emergency protection order was Dad was trying to give the tenant/home health aide the rental house in return for a promise that they would take care of him until he died (he has an unlimited LTC policy).

The judge granted the guardianship and the conservatorship. But we still burned $80K on the process that we thought was handled by the trust. The trust stated "when a Dr states I am no longer capable". Dr's wont' get involved. Since Dad wasn't naked in the front yard barking at the moon the Drs stated "he's still making decisions. They are just bad decisions".
Click to expand...

Yes, IMHO there should be no "springing" language for POAs or trusts.

For my relatives I just had them setup RLTs after their terminal diagnosis, including dementia, with myself as co-trustee instead of successor.

With only one trustee for any actions authorized by the trust language.

Lawyer handled moving their real estate into the trust & I had no issues moving their financial assets into the trust using their DPOA.
 
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