If you’re asking, “Can a power of attorney transfer money to themselves in California?” you’re not alone. It’s a common and important question, especially when concerns of financial abuse or fiduciary misconduct arise. Whether you’re the principal who granted the power, a concerned family member, or a beneficiary of an estate, understanding the limits of a power of attorney (POA) is critical. In California, acting as someone’s power of attorney comes with strict legal duties to uphold, and crossing the line can have serious legal consequences. Let’s break down what a power of attorney can and cannot do when it comes to money, property, gifts, and more.
“Just because someone holds a power of attorney doesn’t mean they hold a blank check,” said Andrew Micaraset, a probate and trust litigation attorney at Gokal Law Group and a 2024 Super Lawyers Southern California Rising Star. “I can’t tell you how many cases we’ve litigated where agents thought they had free rein over someone else’s finances until the court reminded them otherwise. Fiduciary duty isn’t a suggestion. It’s the law,” he said.
Can a Power of Attorney Transfer Money to Themselves?
Generally, no, a power of attorney cannot transfer money to themselves unless they have explicit written authorization in the POA document to do so. Even then, any financial actions taken must benefit the principal, not the agent personally.
In California, a POA agent (also called an “attorney-in-fact”) is bound by fiduciary duties. Under the California Probate Code, an agent must always act:
- In the best interest of the principal (aka the person giving you the POA)
- With honesty, loyalty, and care
- In good faith
Transferring money to oneself without clear authority can be considered self-dealing, a significant red flag for financial elder abuse, breach of fiduciary duty, or even fraud.
Can a Durable Power of Attorney Transfer Money to Themselves?
A durable power of attorney remains valid even if the principal becomes incapacitated. However, the durability of the POA doesn’t change the rule. The agent still cannot transfer money to themselves unless the document explicitly authorizes it.
In fact, because durable POAs often become active when the principal is vulnerable, California courts scrutinize transactions under these documents even more closely.
Can a Power of Attorney Transfer Property to Themselves?
The same legal principles apply to real estate, vehicles, and other property – an agent cannot transfer title or ownership to themselves unless the POA document expressly authorizes self-dealing.
Even with authorization, any transfer must serve a legitimate financial or legal purpose on behalf of the principal. Otherwise, it may be contested as fraudulent or unauthorized, especially in estate litigation.
Can a Power of Attorney Take Money for Personal Use?
In almost all cases, no, a power of attorney cannot use the principal’s money for personal gain – this would be a breach of their fiduciary duty and grounds to pursue legal action. If you are dealing with a situation in which a power of attorney is taking money for personal use, consult with a power of attorney abuse attorney as soon as possible to reverse the damage and hold them accountable.
Related Article: What is Power of Attorney Abuse in California?
When Can a Power of Attorney Take Money for Personal Use?
A power of attorney can only take money for personal use under very limited circumstances, such as:
- Explicit consent from the principal (preferably in writing.)
- Authorized compensation being clearly stated in the POA document.
- Reimbursement for reasonable expenses incurred while managing the principal’s affairs (e.g., travel, postage, legal fees.)
Without a documented right to compensation or reimbursement, using funds for personal use may constitute embezzlement or elder financial abuse under California law.
What Can a Power of Attorney Spend Money On?
Under California law, an agent may only spend the principal’s money in ways that:
- Benefit the principal directly (e.g., paying bills, medical costs, housing expenses.)
- Preserve or manage assets (e.g., maintaining real estate properties, selling real estate.)
- Comply with the principal’s wishes and legal obligations (e.g., paying taxes.)
If the agent is unsure about a financial decision, they should consult a lawyer or seek court approval before acting.
Can a Power of Attorney Take Money Out of Your Bank Account?
Yes, but only within the scope of authority granted in the POA. Most financial institutions require the POA to be on file and properly executed before allowing access to bank accounts.
It’s important to note that:
- Accessing funds for personal reasons is not allowed unless authorized.
- Transactions must be documented, and agents should keep detailed records of withdrawals and expenses.
Can a Power of Attorney Withdraw Money After Death?
No. A power of attorney becomes null and void at the moment of the principal’s death. A transaction made with a power of attorney after the death of the principal could be regarded as an unauthorized use of the power of attorney, and working with an attorney to recover losses is critical.
Once the principal passes away, only the executor of the estate (or trustee, in the case of a trust) can legally manage assets. Any withdrawals made after death may be considered theft or conversion.
Can a Power of Attorney Borrow Money?
Borrowing money, either from or on behalf of the principal, is another area where specific authorization is essential. Without explicit permission:
- Borrowing from the principal’s account is likely a breach of fiduciary duty.
- Even borrowing on behalf of the principal (e.g., a loan in their name) may require court approval, depending on the circumstances.
Always consult an attorney before executing a loan arrangement involving a POA.
Can a Power of Attorney Gift Money to Themselves or Family?
This is a common area of abuse and a frequent cause of probate litigation. In California, an agent cannot gift money to themselves or their family unless:
- The POA document specifically grants the power to gift on behalf of the principal
- The gift is consistent with the principal’s wishes and estate plan
Even authorized gifting must meet standards of reasonableness and fairness, and the document itself may clearly outline the limits of how much is to be given, how much, and to whom it should go. Otherwise, gifts can be challenged as unauthorized transfers or fraudulent conveyances.
“A good rule of thumb is that if the terms of a power of attorney do not make any mention of the agent’s ability to give gifts, they should assume that they are not authorized to do so,” said Micaraset.
Can a Power of Attorney Write Checks to Themselves?
Again, a power of attorney can usually not write checks to themselves, barring specific circumstances. One such circumstance is this could be allowed if they are collecting “reasonable” compensation for the services they have provided when acting as a power of attorney agent.
If they are writing a check to themselves to manage the principal’s affairs for the principal’s benefit, this may be allowed. Also, if the power of attorney document explicitly gives them this authority, they could also be allowed to write a check to themselves.
If an agent is writing a check to themselves to benefit themselves as opposed to the principal, this would be power of attorney abuse, and it is imperative to contact an attorney ASAP.
Can a Power of Attorney Change a Will?
No. A power of attorney cannot create, revoke, or amend a will in California. This includes:
- Changing beneficiaries
- Altering distributions
- Executing a new will
A POA also cannot create or change a trust unless explicitly authorized, and even then, only under limited circumstances.
Wills and trusts are testamentary documents and must be executed by the principal themselves while they have legal capacity. If there are concerns about capacity or document validity, those are best addressed through probate court to invalidate changes to a trust or will or to invalidate entire documents.
“If money is moving and no one can explain why, that’s your sign to act,” said Micaraset. “Power of attorney abuse often hides in plain sight until someone knows what to look for and steps in. Don’t wait for the damage to multiply. Get experienced counsel, follow the paper trail, and protect what’s rightfully yours,” he said.
Related Article: Who Can Override a Power of Attorney in California?
Get Expert Help from Seasoned Power of Attorney Abuse Lawyers
So, can a power of attorney transfer money to themselves? Not unless the power of attorney document that has given them this power clearly authorizes it. Still, even then, the agent must act in strict accordance with California law and fiduciary duties. If you suspect someone has misused a power of attorney to take money or assets, you may have legal options.
Our team at Gokal Law Group represents clients in complex elder financial abuse and estate litigation cases across California. We can help you:
- Investigate suspicious transfers
- Recover misappropriated assets
- Hold fiduciaries accountable for misconduct
- Contest invalid gifts or property transfers
Power of attorney abuse is serious, and the longer it goes unchecked, the more harm it can cause. Contact us for a consultation and find out how we can protect your rights and your loved one’s legacy.
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