BENEFIT OF THE POWER OF ATTORNEY
A power of attorney is the least expensive and least complex of the methods for appointing a surrogate decision maker. Although the law allows the agent to enter financial transactions for the principal, the law requires that the power be used only for the benefit of the impaired person. Terms contained in powers of attorney vary widely, but normally they do not permit the agent to give away the principal's money or use money for the agent's own benefit. Financial powers of attorney are commonly used by family members to contract for long term care, pay the elder's bills, and apply for government benefits.
DRAWBACKS OF THE POWER OF
In elder care the power of attorney has three serious drawbacks. First, it must be signed when the impaired person still has the intellectual capacity to understand the document's terms and consequences. Often, the elder has declined so far before the problem is recognized that it is already too late to get one signed. Second, no law requires banks and other financial institutions to recognize the validity of the document. Banks, stock brokers and others in the financial world often refuse to recognize a power of attorney unless it is on their standard form or signed in their offices. If this happens, the agent may not be able to get access to the impaired persons money in order to use it for health care. The third drawback is that there is no oversight of the agent. Elder financial abuse is a serious problem. Law enforcement in Oregon has thousands of cases in which powers of attorney have been used by unscrupulous relatives to misappropriate the life savings of an elderly family member.