Galvin moves to protect elders’ interests

Bill would clarify responsibilities of power of attorney

June 25, 2011|By John Dyer, Globe Correspondent

William F. Galvin, the secretary of state, wants to spell out rules for caring…

It’s a scene occurring more frequently as the elderly population swells: bank accounts and other savings are looted by the very person seniors have entrusted to watch over their affairs with a power of attorney.

Massachusetts doesn’t regulate power of attorney — a signed, notarized letter of appointment is the only requirement — and advocates for the elderly say the absence of oversight makes it too easy for an unscrupulous person to exploit the position for personal gain.

Now Secretary of State William Galvin aims to remedy the problem with a proposal he submitted to the Massachusetts Legislature earlier this year that would bar people with power of attorney from enriching themselves or otherwise abusing their authority. The legislation would clarify that those wielding power of attorney must act in good faith and, most importantly, for the first time establishes that they have a fiduciary duty to the people they represent to act solely in their best interest.

Right now that code of conduct exists in the spirit of the law but isn’t explicitly spelled out, Galvin and the bill’s other proponents said.

“The real problem here is self-dealing on the part of the holder,’’ said Galvin. “There is no guarantee in the current law that requires power of attorney be used for the benefit of the individual who gave it. There is no real recourse if it is abused.’’

Seniors typically ask a relative or longtime family lawyer to hold power of attorney, although the position does not require any legal expertise. Instead, it is intended to help make life easier for people as they age and become more frail; most commonly the proxy is given access to the senior’s bank accounts in order to pay bills and conduct other financial management.

There are two types: durable power of attorney means the proxy’s authority remains in place if the senior is incapacitated and can’t make a decision on his own; otherwise, power of attorney is void if a person becomes incapacitated.

People can also withdraw the appointment as simply as they assign it — through a notarized, signed letter.

Though statistics are hard to come by, Galvin said incidents of financial abuse are on the rise — possibly caused, in part, by the combination of an increasingly older population and tough economic times, he suggested.

Of some of the approximately 20,000 reported cases of elder abuse in Massachusetts annually, about 16 percent involve financial issues, including situations involving power of attorney, said Al Norman, executive director of Mass Home Care, a statewide network of nonprofit organizations that advocates for seniors.

“Financial exploitation is one of the fastest growing components of elder abuse in Massachusetts,’’ said Norman.