In New Zealand, a Power of Attorney (POA) is a legal document that allows someone to make decisions on behalf of another person. This person is known as the “attorney.” While a POA is designed to protect individuals who may need help managing their affairs, there are cases where it can be misused. The abuse of Power of Attorney is a serious issue that can cause significant harm to vulnerable people. In this article, we will explore what POA abuse is, how it happens, and what steps can be taken to prevent it in New Zealand.
What is Power of Attorney?
A Power of Attorney is a legal arrangement where one person (the principal) appoints another person (the attorney) to act on their behalf. There are two main types of POA in New Zealand:
- Enduring Power of Attorney (EPOA): This allows the attorney to make decisions about the principal’s property and personal matters, even if the principal becomes mentally incapacitated.
- General Power of Attorney (GPOA): This allows the attorney to make decisions on behalf of the principal, but it is usually limited to specific tasks and ends if the principal becomes mentally incapable.
How Does Abuse of Power of Attorney Happen?
The abuse of Power of Attorney occurs when the attorney misuses the authority granted to them. This can take various forms, including:
- Financial Abuse: This is the most common type of POA abuse. The attorney may take advantage of the principal’s funds for their own benefit, such as withdrawing money from the principal’s account or selling their property without permission.
- Emotional or Psychological Abuse: In some cases, the attorney may use their position to manipulate or control the principal, especially if the principal is vulnerable or elderly.
- Neglect: Sometimes, attorneys fail to act in the best interest of the principal. This could involve neglecting to pay bills, ensuring proper healthcare, or failing to make important decisions.
- Excessive Influence: The attorney may exert undue pressure on the principal to make decisions that benefit them personally, rather than acting in the principal’s best interests.
Signs of Power of Attorney Abuse
It can be difficult to spot POA abuse, especially if the principal is vulnerable or unable to speak up. However, there are some signs that can indicate something is wrong:
- Sudden changes in financial habits: If the principal’s bank accounts or property are being used in unusual ways, it could be a red flag.
- Isolation: The principal may become isolated from family members or friends, particularly if the attorney is controlling their social interactions.
- Changes in behavior: If the principal seems confused, upset, or withdrawn, it may indicate that they are being manipulated or mistreated.
- Unexplained changes to the will or estate: If the attorney is pushing the principal to make changes to their will or financial plans, it’s important to investigate further.
How to Prevent Power of Attorney Abuse
Preventing abuse of Power of Attorney in New Zealand requires vigilance and proactive measures. Here are some steps that can be taken to protect both the principal and the attorney:
- Choose the Right Attorney: Selecting a trustworthy and competent attorney is crucial. The principal should appoint someone they trust completely, and ideally, this person should be someone with experience in managing financial matters.
- Regular Monitoring: Family members or trusted individuals should regularly check the principal’s financial and personal affairs. This ensures that the attorney is acting in the principal’s best interests.
- Clear Instructions: The principal should provide clear and specific instructions to the attorney, particularly in relation to financial matters. This can help prevent any misunderstandings or potential misuse of funds.
- Limit the Power: If possible, the principal should limit the scope of the POA to prevent the attorney from having too much control. A limited POA can be more easily monitored and is less likely to be abused.
- Seek Legal Advice: If there are any concerns about the attorney’s actions, the principal or their family should seek legal advice immediately. A lawyer can review the POA and provide guidance on how to protect the principal’s interests.
- Regular Reviews: The POA should be reviewed regularly to ensure that it still reflects the principal’s wishes and that the attorney is still acting responsibly.
What to Do if Abuse is Suspected
If abuse of Power of Attorney is suspected, immediate action should be taken. The first step is to contact the relevant authorities, such as:
- New Zealand Police: If financial abuse or fraud is suspected, the police can investigate.
- Public Trustee: The Public Trustee can provide advice on how to deal with financial matters and can intervene in cases of financial abuse.
- Adult Guardianship: In cases where the principal is mentally incapacitated, an application can be made to the Family Court to appoint a new attorney or to review the current arrangement.
Conclusion
The abuse of Power of Attorney is a serious issue that can have devastating consequences for vulnerable people in New Zealand. It is important for individuals to understand the risks involved and take steps to prevent abuse. By choosing a trustworthy attorney, setting clear guidelines, and monitoring their actions, we can help protect individuals from the potential misuse of Power of Attorney. If abuse is suspected, quick action can prevent further harm and ensure that the principal’s rights and well-being are safeguarded.