How to Gain Access to Bank Accounts with a Power of Attorney

By Jeffry Olson, J.D.

How to Gain Access to Bank Accounts with a Power of Attorney

By Jeffry Olson, J.D.

A power of attorney allows a person, known as the principal, to name an individual, known as the agent, to act on the principal's behalf. The powers granted often include management of the principal's bank accounts.

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When choosing what type of authority can be granted to the agent, follow these steps to ensure that your designated agent has the proper authority to access your bank accounts.

 

 

 

1. Review the power of attorney document.

The language of the document determines the powers of the agent. A general power of attorney is broad, allowing the agent to perform financial transactions on the principal's behalf. A specific power of attorney is limited, often allowing the agent to act for only one transaction or regarding one account. Before trying to access the principal's bank account, review the document to make sure it clearly grants the agent power to access that specific bank account.

2. Determine the bank's requirements.

Banks often have different requirements for powers of attorney. Although general authority allows the agent to access all financial accounts, some banks may be resistant. It is not uncommon for a bank to require the power of attorney to identify specific accounts, sometimes by account number, prior to allowing the agent access to an account. Ultimately, a court would likely order the bank to allow the agent access to the account, but at that point, the lack of clarity in the document has become an unnecessary obstacle that created an unnecessary expense for your agent. As a precaution, determine your bank's requirements prior to needing the power of attorney. If your bank is particularly technical about the requirements, you must either satisfy those requirements in the power of attorney document or consider changing financial institutions.

Some financial institutions even require account holders use the institution's own form. News stories have reported banks refusing to honor a power of attorney—sometimes even a form dictated by state statute. In some cases, the bank requires a specific, bank-generated form; if the principal develops dementia before discovering this requirement, the principal cannot execute the document. You can overcome this problem, but it often requires the services of an attorney. Again, this is something to investigate prior to needing the power of attorney.

3. Have identification ready.

Prior to allowing the agent access to your bank account, the bank must confirm that the identity of the person seeking access is the same as the agent granted authority by the power of attorney. The agent needs a copy of the document along with proper identification, preferably government issued, such as a passport or driver's license. Banks are legally responsible if they allow an unauthorized person to access accounts, and they take this matter very seriously. As discussed above, this may be an issue to investigate with your bank prior to needing your power of attorney.

Banks frequently do not allow an agent to change the beneficiary of a bank account. State law may also prevent this. A power of attorney allows an agent to access the principal's bank accounts, either as a general power or a specific power. If the document grants an agent power over that account, they must provide a copy of the document along with appropriate identification to access the bank account. Be advised; some banks may place roadblocks when attempting access to those accounts. If you grant a power of attorney, check with your bank to find out whether the document you intend to use is sufficient. You may want to change the document or even change your bank.

If you are planning on drafting or currently going through the process of obtaining a power of attorney, understand the steps required in order to allow you agent access to your bank accounts. While you might be following your sate's laws in terms of the process and applicable forms, keep in mind that the bank might have its own form to utilize. Therefore, you'll want to know what is required ahead of time to avoid a potential delay in the process if you need your agent to gain access to your bank accounts.

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law.

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