Banks and Financial Durable Powers of Attorney

Banks and Financial Durable Powers of Attorney

By Michael G. Kelly, Arizona Mobile Legal Services

We are contacted by persons who need assistance in regard to a bank that refuses to honor a validly executed Financial Durable Power of Attorney. This often occurs because the person who executing the power executed a “springing” power of attorney long before it was brought to a bank or other third party to add the agent under the power as a signor/authorizer on the account.

A “springing” durable power of attorney is a power that does not come into effect until the principal (the person providing the power) becomes incapacitated (unable to make informed decisions regarding their financial affairs). This can occur years after the Power of Attorney is executed by the person when they have capacity to execute it, causing the bank to view the power as stale and therefore questionable as to its validity. Though such a conclusion is in error, it is nevertheless a practical reality when dealing with some banks. Obviously this is a serious problem when an agent (often an adult child) is attempting manage their principal’s (the parent’s) financial affairs because they are no longer able to. It is important to take steps to prevent this situation from occurring.

One approach that is often used is to name the agent as an actual owner on a joint account. This is a mistake because it invites fraud, in that the new co-owner is free to make unlimited withdrawals of money from the account that is not really their own. In addition if the new co-owner is ever sued for anything, the money that is in the account is now fair game in the law suit. Arizona Mobile Legal Services does not recommend this approach.

Another approach for a springing power is for the principal to certify the Power of Attorney by affidavit each year, effectively making it current. This may be somewhat effective, however, there is no guarantee a bank would accept it and the principal would be burdened with exercising the diligence to assure renewal each year.  Alternatively, the Power itself could be redrafted and executed periodically but that involves even greater burden and in practice is unlikely to occur unless relationships have changed.

A final approach, and one which Arizona Mobile Legal Services recommends, is to execute an IMMEDIATE Durable Financial Power of Attorney. An immediate power comes into effect immediately upon execution as opposed to being delayed until incapacity occurs (springing power). By doing this the power can be immediately presented to a bank in order to have the agent added as a signor/authorizer on the account.  This avoids staleness of the document and the burdens of annual renewal. It is extremely important that the agent is a highly trusted person who is beyond reproach since they are being given immediate powers to act on the principal’s behalf.  The agent must tacitly understand that they are acting under the direction and knowledge of the principal at all times, while the principal has capacity. The document should have safeguards in place to assure that the agent would be held legally accountable for any financial abuse.  This approach is vastly superior to adding someone on to an account as an owner with no legal safeguards.

© Michael G. Kelly, Arizona Mobile Legal Services

Tech Support Scam

A recent article has appeared in the Arizona Republic discussing a substantial increase in Tech Support Fraud across the U.S. according to the FBI. The article stated that losses from this fraud in Arizona in just ½ of 2018 are 263% of losses in all of 2017. While this type of fraud can victimize anyone, it has been increasingly targeted at citizens over the age of 60.

The scams start with an unsolicited phone call, email or computer-screen pop-up notification from someone purporting to be a tech-support specialist who has identified a virus infecting the victim’s computer. They offer to fix the problem – which very likely doesn’t exist – FOR A FEE.

When a victim responds to a call, email or clicks on a pop-up, criminals will offer to help fix the victim’s technical issues, leading them to request remote access to the victim’s device. At that point the victim will have already paid them money.

NOTE: It is this writer’s experience that these scams are presented suddenly, while a person is working on their computer, and prevents the work from continuing until you call a number in a pop-up to get the problem “fixed.”  One way to combat this problem is to press the ctrl key, then press the alt key while still holding the ctrl key down, and pressing the Delete key, while still holding the ctrl and alt keys down. This will interrupt the program and you can activate a program called  “Task Manager”  by clicking it on a window that comes up.  You can then select the web browser you are using (Chrome, explorer, etc.)  to eliminate the problem. At that point you should run any anti-spyware and anti-virus program you have and scan for problems to see if there is really anything going on and to clean up your computer.

The FBI states, anyone who is online is vulnerable to this scam, perpetrated by well-organized criminal organizations around the world looking to victimize people. Fraudulent tech support companies often will advertise their services online alongside legitimate companies, seeking to trick a victim.

With this access, scam artists can download malware to the victim’s computer, launch phishing attacks against the victim’s contacts and access the victim’s personal information such as tax returns or health records.

Criminals initiate contact with the victim and convince them to allow remote access. The FBI warns that access should never be granted to an unverified company.

According to the FBI a specific form of the fraud known as the “Fake Refund” is also becoming increasingly common. This scheme involves an offer to the victim for a refund for previous support services. The scam artist will then pretend to refund too much money to the victim’s account and ask the victim to return the difference. This kind of “refund and return” process can happen multiple times, causing the victim to potentially lose thousands of dollars.

Estate Planning

Estate planning is the process of getting your affairs in order so that you make things easier for your surviving family members when life ends. Not only that, it puts you in charge of your finances and you control the outcome of many years of your hard work and savings. We encourage individuals to put plans for the future in place now.

A well designed estate plan will not only benefit your family when you are gone, but it can also be an important part of your business and investment planning as well.  We can help you minimize taxes, maximize returns and protect yourself and your assets- Michael G. Kelly, Attorney at Law is a Certified Practitioner in Individual and Small Business Taxation.  An estate plan should at least include a will, a general durable power of attorney for finances, and a health care advocate power of attorney. We tailor the plan to fit your needs, goals and concerns.

No matter what the size of your estate is, everyone can benefit from estate planning.  For example, planning for disability by having someone designated to make your healthcare decisions and manage your personal property is very important.   Having a trusted individual with authority to manage your health care and finances, if necessary, reduces stress and burden on you and your family.

Following are situations where an estate plan would be very helpful;

  • You’re in a second (or later) marriage
  • You’re single
  • Become disabled due to a stroke, car accident etc.
  • You own one or more businesses
  • You own real estate in more than one state
  • You want to leave some or all of your estate to charity
  • You have special needs children
  • You have substantial assets in 401(k)s and/or IRAs
  • You have minor children or no  children
  • You were recently divorced
  • You have a pet to plan for who cares for them and expense if you are unable
  • You recently lost a spouse or other family member

If any of the questions below relate to you, then an estate plan would be necessary.

  • Upon death, who receives your assets?
  • Who will make health care decisions for you if disabled?
  • Do you want to include your wishes if you are on life support?
  • Preserve your assets for your beneficiaries?

An estate plan gives you control over how your assets will be distributed upon death.  If you die without planning, a judge will make these decisions following state laws and your estate will go to the state if your heirs are not found within a certain time period.  If you want your property to go to certain persons it is necessary to put together an estate plan.

State laws govern property a person leaves behind when they die.  These laws are quite technical, which makes it necessary to hire an estate planning lawyer.  Wills, Trusts, and Medical or Financial Powers of Attorney have very specific state laws about what can be in them.  There are laws about who the personal representative, trustee, health care surrogate or attorney in fact may be, as well as the witnesses and what formalities there are when signing these documents.

Estate planning documents found on the internet come with the caveat ‘buyers beware”.   Your family may find out after the fact that the will, trusts and powers of attorney are not legally valid.  Your family will go through substantial inconvenience and expense and your wishes may not be carried out.

Our Probate, Estate Planning and Trust Planning Services include:

  • Living Trusts and Wills
  • Probate/Trust Administration
  • Powers of Attorney

There are 5 major reasons why people of varying means should establish an estate plan:

  • Privacy for self and family
  • Substantial cost savings
  • Quick and easy transition to loved ones
  • Flexibility and the ability to make changes
  • Clarification of wishes for end-of-life medical decisions

CALL FOR A CONSULTATION

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PHONE: (623).628-1110,  (623) 628-0977
FAX: (623) 240-2609

KELLY LAW AND TAX

Locations:

15331 W Bell Rd Suite 212,  Surprise, AZ 85374

4435 E Chandler Blvd Suite 200,  Phoenix, AZ 85048 (I-10 & Chandler Blvd)

14050 N 83rd Ave Suite 290,  Peoria, AZ 85381 (83rd & Thunderbird)

 289 N Litchfield Rd, Goodyear, AZ 85338 (Southwest Valley Chamber of Commerce)

My Spouse is becoming very forgetful – What Should I Do?

My spouse is becoming very forgetful about things that would normally be remembered. I’m worried that the cause may be Alzheimer’s disease or other dementia. What should I do?

An obvious first step is to have your spouse checked out by a qualified physician. The doctor can determine what, if anything is actually wrong and recommend treatment. If the doctor’s diagnosis is dementia further legal steps to provide adequate legal protections are necessary.

It is important to have the doctor spell out, as clearly as possible; exactly what your spouse is capable of doing from a decision-making standpoint when the diagnosis is made. For example, can he or she identify and understand the extent of the property he or she owns and who his or her heirs are? Is he or she capable of understanding the nature of a transaction sufficient to enter into a contract? Can he or she identify those whom she trusts enough to manage his or her affairs in order to authorize them to do so?

If the answer to any of the above questions is “yes” then it is imperative to consult an elder and estate planning attorney in order to put your spouse’s legal affairs in order with documents such as Powers of Attorney for financial and medical affairs, wills, trusts, and any other documents which apply to her particular circumstances. By doing this, we can keep your life affairs private and reduce legal fees and court costs.

If the answer to the any of those questions is “no” it may be necessary to go into probate court and petition for a Guardianship and Conservatorship in order to take over management of your spouse’s personal and financial affairs.  This is an expensive, public process that requires ongoing court supervision. This scenario will often occur once a dementia patient progresses to later stages and no longer has the capacity to enter into legal documents that would eliminate the need for a guardianship or conservatorship. This is another reason for consulting a physician and an elder and estate planning attorney as early as possible. It is strongly recommended to have legal documents in place that provide others with authority to act on one’s behalf well before dementia or any other disabling condition rears its ugly head.

 

 

Tech Support Scam

A recent article has appeared in the Arizona Republic discussing a substantial increase in Tech Support Fraud across the U.S. according to the FBI. The article stated that losses from this fraud in Arizona in just ½ of 2018 are 263% of losses in all of 2017. While this type of fraud can victimize anyone, it has been increasingly targeted at citizens over the age of 60.

The scams start with an unsolicited phone call, email or computer-screen pop-up notification from someone purporting to be a tech-support specialist who has identified a virus infecting the victim’s computer. They offer to fix the problem – which very likely doesn’t exist – FOR A FEE.

When a victim responds to a call, email or clicks on a pop-up, criminals will offer to help fix the victim’s technical issues, leading them to request remote access to the victim’s device. At that point the victim will have already paid them money.

NOTE: It is this writer’s experience that these scams are presented suddenly, while a person is working on their computer, and prevents the work from continuing until you call a number in a pop-up to get the problem “fixed.”  One way to combat this problem is to press the ctrl key, then press the alt key while still holding the ctrl key down, and pressing the Delete key, while still holding the ctrl and alt keys down. This will interrupt the program and you can activate a program called  “Task Manager”  by clicking it on a window that comes up.  You can then select the web browser you are using (Chrome, explorer, etc.)  to eliminate the problem. At that point you should run any anti-spyware and anti-virus program you have and scan for problems to see if there is really anything going on and to clean up your computer.

The FBI states, anyone who is online is vulnerable to this scam, perpetrated by well-organized criminal organizations around the world looking to victimize people. Fraudulent tech support companies often will advertise their services online alongside legitimate companies, seeking to trick a victim.

With this access, scam artists can download malware to the victim’s computer, launch phishing attacks against the victim’s contacts and access the victim’s personal information such as tax returns or health records.

Criminals initiate contact with the victim and convince them to allow remote access. The FBI warns that access should never be granted to an unverified company.

According to the FBI a specific form of the fraud known as the “Fake Refund” is also becoming increasingly common. This scheme involves an offer to the victim for a refund for previous support services. The scam artist will then pretend to refund too much money to the victim’s account and ask the victim to return the difference. This kind of “refund and return” process can happen multiple times, causing the victim to potentially lose thousands of dollars.

 

New Arizona Law Helps Protect Against Excessive Surprise (out-of-network) Medical Billings.

Surprise billings from medical providers who are out of the insurer’s network happen often and are a very unpleasant experience for insured patients.  This often happens when a specialist is summoned unexpectedly by an in-network provider on a medical case and can result in substantial medical bills that are in excess of what insurers will reimburse under the patient’s health plan.

A new law in Arizona seeks to protect patients by providing them with a new dispute resolution system for surprise bills that are at least $1,000 above the combined patient cost-sharing and insurer’s allowable reimbursement. The dispute resolution process includes a pre-arbitration settlement conference and mandatory arbitration to provide a final determination of the matter if it is not settled beforehand.  This will only occur if the patient has exhausted appeals with the insurer. The arbitration must occur in the county where treatment is rendered and may be by phone. The process is designed to take only a few months and there are penalties for noncooperation by either party.

This process, though falling short of limiting the practice of surprise billing like several other states have, is a significant step forward in protecting patients from this very unpleasant surprise.

 

 

 

 

A NEW HEALTH CARE PLANNING APP

Most of us feel quite relieved when we get our estate planning done, particularly when it comes to naming someone to make decisions for us when we cannot (health care proxy) or providing advance directives concerning our last illness or injury (often referred to as a living will).

The American Bar Association Commission on Law and Aging has developed a smartphone app that allows users to store and distribute their living will or health care proxy. The app is called “My Health Care Wishes.”

How Does It Work?

The app makes advance directives easily accessible when they are actually needed. The app enables individuals, and their family members to store their own, and each other’s documents and important medical histories on their smartphones.  There can be a struggle to find needed information when a parent has a medical emergency and children are often scattered around the country, as is often the case. Distributing the information to each child’s phone would allow quick access to the information and any person with the information could email the information to the medical provider who needs it in real time, saving valuable time in the event of a crisis.

What Else Do I Need To Know?

Advance directives, such as a Living Will or Health Care Power of Attorney, legally authorize another person to make health care decisions if an individual loses the ability to make his own decisions. It is important for everyone to create and sign these directives and to be certain that their appointed agents know where to find the documents when needed. More info about the app can be found at www.myhealthcarewishes.org.

Questions? Contact us for more information.

 

 

Preventing Identity Theft After the Death of a Loved One

For a loved one after death to become a victim of identity theft is the last thing any of us would ever expect to happen. Unfortunately it is a regular occurrence. There are some very important steps we all can take to prevent this from happening:

  • Do not include the birth date, last address or most recent job in the deceased loved one’s obituary.
  • Make sure someone is in the deceased loved one’s home during the published visitation and funeral times, to prevent a burglary/ theft of documents with sensitive personal information.
  • Make sure each of the credit reporting bureaus gets a copy of the death certificate and ask each to add a “deceased alert,” which will freeze the credit file.

Equifax: PO Box 740241, Atlanta, GA 30374

Experian: PO Box 9701, Allen, TX 75013

TransUnion: PO Box 2000, Chester, PA 19022

  • About one month after the loved one’s death, review your loved one’s credit report at AnnualCreditReport.com to ensure there is no suspicious activity. You may want to do this once a month for one year after the death since it takes that long for an account with a deceased notation to be removed from a credit report.
  • Make sure that your funeral director has notified Social Security about the death of your loved one. You may also want to advise the IRS by calling 800-829-1040 to prevent someone from filing a tax return and claiming a refund in the name of the deceased loved one.
  • Be sure to keep copies of any documentation you provide to these agencies, just in case a follow-up is needed

 

Dad is becoming very forgetful – What Should I Do?

Q.           My father is becoming very forgetful about things he would normally remember. I’m worried he could be coming down with Alzheimer’s disease or other dementia. What should I do?

A.            An obvious first step is to have Dad checked out by a qualified physician. The doctor can determine what, if anything is actually wrong and recommend treatment. If the doctor’s diagnosis is dementia further legal steps to provide Dad with adequate legal protections are necessary.

It is important to have the doctor spell out, as clearly as possible; exactly what Dad is capable of doing from a decision-making standpoint when the diagnosis is made. For example, can Dad identify and understand the extent of the property he owns and who his heirs are? Is he capable of understanding the nature of a transaction sufficient to enter into a contract? Can he identify those who he trusts enough to manage his affairs in order to authorize them to do so?

If the answer to any of the above questions is “yes” then it is imperative to consult an elder and estate planning attorney in order to put Dad’s legal affairs in order with documents such as Powers of Attorney for financial and medical affairs, wills, trusts, and any other documents which apply to his particular circumstances. By doing this, we can keep Dad’s life private and reduce legal fees and court costs.

If the answer to the any of those questions is “no” it may be necessary to go into probate court and petition for a Guardianship and Conservatorship in order to take over management of Dad’s personal and financial affairs.  This is an expensive, public process that requires ongoing court supervision. This scenario will often occur once a dementia patient progresses to later stages and no longer has the capacity to enter into legal documents that would eliminate the need for a guardianship or conservatorship. This is another reason for consulting a physician and an elder and estate planning attorney as early as possible. It is strongly recommended to have legal documents in place that provide others with authority to act on one’s behalf well before dementia or any other incapacitating condition rears its ugly head.

 

Questions?  Contact us today for a consultation.

 

IDENTITY AND FINANCIAL ABUSE OF SENIORS IS ON THE RISE!

IDENTITY AND FINANCIAL ABUSE OF SENIORS IS ON THE RISE!

Unwary seniors are increasingly victimized by others regarding their identity and financial assets.

This often occurs when a credit or ATM/Debit card is lost or stolen. Seniors often delay reporting any missing or stolen credit or ATM/Debit cards. These events should be reported immediately to prevent substantial financial loss.

When a credit card is involved you can report the problem before any charges are actually paid and dispute any improper charges posted against the card. With an ATM/Debit card the theft/loss event becomes much more serious. The general rules for ATM/Debit cards are as follows and may vary by card provider:

  • If ATM/debit card is reported lost/missing before being used again then no loss; $0
  • Within 2 business days after lost/missing, loss is limited to $50
  • More than 2 days after lost/missing, loss is limited to $500
  • More than 60 days after lost/missing, unlimited liability (whatever is in the bank account and possibly linked accounts)
  • The best way to limit risk of loss is to confine the use of it as an ATM/debit card as much as possible, or use it exclusively as a credit card instead. Many credit cards have applications that will alert to charges almost instantly.
  • Questions?  Contact us today for a consultation.