Well, I have to admit I knew that I was likely to get some feedback on my recent article warning readers that not every person vested with power of attorney (POA) is a good choice for the role; however, I was not expecting the overwhelming response.

Over the past few weeks, I have had people come up and compliment me for raising awareness; sadly, many have also shared events in their own families that have left them not knowing what to do next.

This made me think: it’s certainly important to raise people’s awareness of the potential risks if they don’t monitor situations closely; but what happens when you have already discovered an issue that turns out to have been going on for some time? Even worse, what if the “donor” (i.e. the person who has granted the POA) refuses to believe anything is wrong?

First, it is important to note that I am not a lawyer, therefore my advice has no legal bearing; however, after working in the financial planning industry for many years (though I am no longer practising), I have a pretty good idea of what one can and cannot do to handle things.

With that said, I will highlight two specific scenarios for how to combat – and I choose the word combat, because peace talks are over!

Scenario 1

For a while, you have suspected something wasn’t right. You have done your homework and discovered that a family member or a close friend of the family has been taking a “convenience fee” for their POA duties. However, this nominal amount has added up to some serious money. So, how do you deal with it?

Remember that your gut is usually right. If the POAs actions seem questionable or inappropriate – especially if they have taken more than is reasonable or authorised – it may be necessary to seek legal advice. An attorney specialising in estate planning or elder law can review the specific circumstances of and authority granted under the POA, and they can advise on the legality of the fees collected. They can also assist in determining whether any breach of fiduciary duty has occurred.

In some cases, it might be appropriate to involve an independent third party, such as a financial adviser or a court-appointed fiduciary, to review the accounts and ensure the proper management of the donor’s estate or affairs. If such parties confirm misconduct, legal action may be necessary to recover stolen funds and ensure proper oversight going forward.

Ultimately, the priority should be protecting the financial interests of the person under the POA. Key steps to resolve the issue fairly and ethically include transparency, legal guidance and potential court intervention. A breach in fiduciary duty on the part of the POA is the key determining factor!

Scenario 2

For a while, you have suspected something wasn’t right. You confront the situation head on, but the donor simply puts their head in the sand and refuses to accept that something is going on.

This is a bad situation, particularly when the donor appears to be ignoring or dismissing concerns raised by someone who genuinely has their best interests at heart. Typically, the donor is driven by the desire to avoid conflict or does not wish to face uncomfortable truth that someone is doing something deliberately to harm them financially.

Refusal to confront potential problems can be a defence mechanism, but the most concerning aspect of such cases is the fact that denial typically opens the door to full- blown exploitation of the donor. The POA now knows that their behaviour has come into question, but they blame everyone else in the donor’s life for any shortcomings or issues and their goal will be to continue to isolate the donor and gain further control.

It is important to take a step back and consider why the original POA was granted. Was it because the donor was not mentally equipped, or had they perhaps become incapacitated? There must be a reason behind a person granting POA to someone else. Therefore, you must look to answer these two basic questions:

1, What was the reason for the POA?

2, Why was this particular person selected?

Answering these provides you with a ‘combat plan’; if your suspicions are warranted, it is likely that something you discover in answering them will not make sense, providing you with the angle you need to focus on.

In this type of scenario, expect tackling the issue to be quite a drawn-out process: You are dealing with a donor who refuses to acknowledge the problem and a POA who will fight tooth and nail to protect their asset – not the donor themselves, but their assets.

Currently, Bermuda is in the process of implementing an independent governmental body, the Office of The Public Guardian to Support Vulnerable Persons, to help with such situations. Most Commonwealth countries around the world have implemented an Office of the Public Guardian, as it addresses the need to protect vulnerable persons (see the link provided at the end of this article).

However, until such time as this government office is established in Bermuda, the only way to address this situation is to challenge the POA from a legal perspective. You will need to get a lawyer, and because this will cost you money, it is best to be sure that your suspicions are correct and that you have all your artillery ready for this battle.

The lawyer will review the existing POA document, assess the specific circumstances that led to it being granted and determining who would assume the role of POA. The lawyer will further determine whether the agent (POA) is acting outside their authority or abusing their position.

If it is determined that the donor was of sound mind when the POA document was executed, this presents a big challenge, because it demonstrates acceptance. In this case, the lawyer may need to prove there was coercion or that the donor was under duress during the process.

To challenge a POA, the lawyer may recommend filing a petition in court to revoke or terminate the authority of the agent. Evidence of financial abuse (e.g. unauthorised transactions, sudden asset depletion or inconsistent financial records) will be vital in any court proceedings.

Other legal options may include requesting an accounting of the agent’s actions, appointing a new fiduciary or even pursuing criminal charges if fraud or theft is involved. The process often involves demonstrating that the agent breached their fiduciary duty, acted dishonestly or exploited the principal’s vulnerability.

Challenging a POA can be complex and emotionally taxing but working with an experienced lawyer ensures that both your rights and the principal’s assets are protected. Ultimately, timely legal intervention can prevent further abuse and secure appropriate oversight of the principal’s financial affairs.

For all those who are currently struggling, I hope you find this insightful, and I do wish you the best of luck.

• Carla Seely has 25 years of experience in the international financial services, wealth management and insurance industries. During her career, she has obtained several investment licences through the Canadian Securities Institute. She holds the ACSI certification through the Chartered Institute for Securities and Investments (UK), the QAFP designation through FP Canada, and the AINS designation through The Institutes. She also holds a master’s degree in business and management