Can banks legally refuse to accept a durable power of attorney?

8 answers | Last updated: Jan 26, 2016
Emilypinaud asked...

I went to my parent's bank with a durable power of attorney. The bank manager informed me they do not accept power of attorney. So I added my name to their account. Is it legal for the bank not to accept a durable power of attorney?

Expert Answers

Barbara Repa, a senior editor, is an attorney, a journalist specializing in aging issues, and the author of Your Rights in the Workplace (Nolo), now in its 10th edition.

It is not acceptable for a bank to have a blanket policy against accepting a power of attorney, since they are sanctioned by the laws in every state.

Bank authorities are legally responsible to honor powers of attorney that have taken effect unless there is a fatal flaw such as a forged signature.

The problem some people have"”and you may be one of them"”is that they are dealing with a bank employee who is charged with following bank policy that is usually set by the bank's legal department. Sometimes, those departments are misinformed"”or impose unrealistic requirements.

Your action in adding your name to the account may take care of your needs, so that you won't be required to take any other action. But if you feel you need to get the power of attorney recognized, then you will likely need to be persistent. Insist that the teller with whom you are dealing bring in the branch manager. If the manager doesn't help, call the bank's legal department on your own.

Be ready to supply a copy of the power of attorney. Some documents take effect at a specified date. But if your parents' POA specifies that it takes effect when they lack a certain mental capacity, you will also need a doctor's certification of that condition.

Finally, the threat"”or actuality"”of moving any accounts you have with that bank to another institution may also speak loudly.

Community Answers

Wyndie answered...

Banks that do not accept your Power of Attorney are in violation of Probate Code, you can sue them and they may have to pay all costs, according to an attorney, however Bank of America has done this to me as well and I guess many others as well. This becomes a horrible problem to deal with at a time when you are trying to deal with parents who are ill at the same time. Personally I think all banks who refuse them should be fined about 1million dollars for each act and maybe they will think twice about making us jump through hoops just to do what our loved ones asked us to do in the first place! I will sign on to any class action suit against them I can find!

A fellow caregiver answered...

I'm having the same problem with my father's bank. Dad was diagnosed with dementia by his primary care physician and a neurologist last summer, after he made some near-catastrophic mistakes with his finances and taxes. It took several weeks (unfortunately) to get letters of incapacity from them so I could act as my father's power of attorney. In the meantime, my brother, who has a history of getting our parents to buy big-ticket items for him (he's in his 50s, by the way, and is an able-bodied man who works full time), persuaded Dad to open a checking account at the bank with his name on it. When I brought the letters of capacity to the bank and confronted the banking staff member who opened the account, she went to the bank manager, who refused to recognize my POA document and told me I would have to bring in my brother and father with me to the bank "to straighten things out." They apparently told my brother the same thing, because I received a string of threatening emails from him after that. Then the bank's legal department stepped in, froze the accounts, and called in Adult Protective Services. The APS investigator interviewed me, looked over the documents and agreed that I was the legal representative for my father. They also gave my brother a slap on the wrist. (Seriously. I showed the investigator the threatening emails but nothing was done about it.) The bank manager however refuses to even take my phone calls and the accounts remain frozen. Dad's attorney says we may have to sue the bank, which will cost thousands of wasted dollars. Also, in the meantime, I had no way of paying for Dad's expenses since we could no longer write checks from the frozen account. Luckily my credit union recognized my power of attorney and allowed me open an account for Dad. Social Security, the institution where Dad has his IRA, the other bank where my mother had some money squirreled away---all of them have recognized me as Dad's trustee and POA. It's just this one bank which has given me insomnia and put me through hell. (Dad is oblivious and doesn't care, as long as he has a couple of 20s in his wallet.) I hope the bank's manager roasts in hell after what she's done. No private institution should be allowed to create its own laws that violate the laws of the state and the country.

Maldacht answered...

In the Commonwealth of Virginia, it is illegal not to accept a power of attorney unless the person accepting it has reason to believe it is falsified. And in that case, the person presenting it can take the bank to court. I am a formal complainant -- I wrote to the Attorney General of Virginia to get a decision -- in a case against my mother's credit union, which broke the law by both placing conditions on their acceptance of my POA and requiring additional affidavits. Check your state law. Ours is relatively new (2010), but the language is very clear. The bank is breaking the law. If a bank asks me to provide any additional information again, I will call the police and show them the law. Then I will sue the hell out of the bank.

A.c. answered...

America First Credit Union refuses to acknowledge me as co-Attorney-in-Fact on both my mother's and sister's Power-of Attorney. They will only answer question for my brother since years ago he was added to their accounts, but now they are both incapacitated and he needs help in managing all aspects of their lives in an assisted living home. I do all of the detailed finances with the exception of anything connected to America First. My brother asks the questions I need answers to and then tells me second hand so I can follow through to do what meets their needs. This is a joint process, however it shouldn't be this difficult. We will be moving these accounts to an organization that will work with US. In addition, when WE presented the Power-of-Attorney together, America First asked for our Social Security Numbers, a lame story was given. Something about they needed to make sure we had good credit. We gave them the Social Security Numbers and now are concerned. By the way, since my mother and sister are on Social Securiy,my brother and I went to Social Security Administration (SSA) and have filed with them of our involvement in their finances. We filed all additional documents required by (SSA) to monitor these accounts. So why is America First so interested in our credit?

A fellow caregiver answered...

Explanation of another reason banks, investment companies and title companies will not take POA's immediately. How do they know that your POA is the only one out there and it is the newest one and that your's has not been revoked? They have no way to ascertain those facts without a court signed document.

Txblue answered...

I had similar problems with Atlanta First National bank in Atlanta Tx. We just lost my father and my mother fell and broken her arm and with her age she needed rehab to get her strength back. In the mean time her bills needed to be taken care of. My father and mother a year ago went to their attorney and did the forms granting me as their power of attorney and had them filed with the county court as both of them have had strokes and my dad wanted my mom to be able to be taken care of in case anything happened to him. So when it came time to use this POA for my mother, her bank absolutely refused to grant me access to take care of her bills. The manager stated that I would have to bring my mother up to the bank, mind you she was in rehab at this time, to add me to her account, plus we needed death certificates to take my father off to complete the process. I was very upset with the manager having to put us through all of these hoops. Needless to say, rehab allowed me to check my mother out for a couple of hours, she told them what she thought, added me to the account and we took funds we needed to take care of her bills. Needless to say, we opened an account with the credit union in town and will no longer deal with First national bank of Atlanta Texas again.

A fellow caregiver answered...

My father was unable to manage his finances. He agreed to accept my assistance but would turn around and withdraw cash and report his checks lost when I had his checkbook. I ended up having my name added to his account in such a way that his mischievous activity did not effect my credit while allowing me access to manage his payments. As his agent I was told, "There is no such thing as power of attorney" by a Citibank clerk regarding my father's POA. Whether this referred to bank policy or not the choice of words reflected appalling ignorance and poor training of bank staff.