Stop Financial Elder Abuse

Stop relatives from taking money
Rachel Emma Silverman and Ashby Jones
The Wall Street Journal
Nov. 28, 2007 10:51 AM

Sadly, Brooke Astor is making headlines again. But there may be a lesson in the indictment of the late philanthropist's son and a lawyer close to the family's affairs: It can be risky to hand off financial responsibilities even to someone you think you can trust.

Estate lawyers say older people are often making use of a tool known as a durable financial power of attorney. This legal document authorizes an agent - usually a spouse, another family member, or a trusted adviser - to make financial decisions if you become unable to make them yourself. But naming someone to take control over your money has the potential for serious abuse, and lawyers are increasingly devising strategies to help safeguard their clients.

Among the tactics: Lawyers are including provisions requiring regular accounting statements from agents. They also are naming co-agents who can serve as checks on each other, or naming a supervisor who has the power to fire an agent.
"People want to make sure when they sign the document that they do what they can to protect themselves," says Bernard A. Krooks, a lawyer with Littman Krooks in New York, who specializes in elder-law. "When the power of attorney takes over, you're usually no longer in a position to supervise it."

According to the indictment in the Astor case, made public Tuesday in Manhattan, Ms. Astor's son, Anthony Marshall, abused his power of attorney in order to "unjustly enrich" himself and others.
"What I tell people is that if you don't trust someone one-thousand percent, don't grant them power of attorney," says Ronald Fatoullah, an elder-law specialist in Great Neck, N.Y.

Another key point: Make sure to carefully lay out exactly what powers you want your agent to have. For instance, you can limit the agent's power to make gifts of your property, so they can't just give money to themselves. Spell out under what conditions gifts can be made, how much and to whom.

Also, if you sense wrongdoing, contact your local district attorney's office, many of which have elder-abuse units, and let them investigate.

Abridged Article: SOURCE