Power Of Attorney Accountings – Steps To Take When The Agent Steals From An Account

Introduction

     A Power of Attorney is a useful estate planning tool for individuals to have in place, so when they begin struggling to manage their own financial affairs, or suspect that they may one day lack the capacity to do so, an agent is there to help right away. A Power of Attorney names an individual to act as the principal’s “agent”, giving the agent authority to manage the principal’s financial assets such as bank accounts and investment accounts, writing checks and paying bills while the principal is still alive, but unable to do so on their own. However, in some situations, the agent may act improperly when using their authority as Power of Attorney to benefit themselves.

Examples of Improper Use of Power of Attorney

     A common example of an agent acting improperly using their authority under a Power of Attorney is stealing funds from a principal’s bank account for personal use. An agent has the authority to pay bills, issue and sign checks, and make monetary transfers. Another example of an agent acting improperly includes, but is not necessarily limited to, updating beneficiary designations on financial accounts outside the desires of the principal as laid out in their estate plan.

Steps to Take if you Suspect an Agent of Acting Improperly

     The first thing to consider when you suspect an agent may be acting improperly using their authority as Power of Attorney is Virginia Code § 64.2-1612; more specifically, Virginia Code § 64.2-1612(I). This section states that an agent shall, upon reasonable request made by a person listed in Virginia Code § 64.2-1614 who has a good faith belief (emphasis added) that the principal suffers an incapacity or, if deceased, suffered incapacity at the time the agent acted. If this applies to your situation, you have the right to send a letter requesting an accounting of the agent’s actions for the last five (5) years preceding the principal’s date of passing, or five (5) years from the date of the request if the principal is then living. If the principal has passed at the time of the request, it must be made within one (1) year of the date of passing.

     The agent then has thirty (30) days to provide the information requested in the letter. If they do not provide a response or provide an inadequate response, you have the option to have our law firm, Smith Strong, PLC, file, on your behalf, a Petition in the applicable Circuit Court asking the Court to make a ruling that requires the agent to comply with the request.

     If you would like to discuss your options, please call one of our offices at (804) 325-1245 (Richmond) or (757) 941-4298 (Williamsburg) to discuss how our attorneys can be off assistance. Our team of knowledgeable elder law and estate litigation professionals is ready to provide you with the guidance and support you need throughout the process.

Special thanks to Owen Togna for editorial assistance in drafting this article.