Finding out your Power of Attorney is useless

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RetiredAL
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Re: Finding out your Power of Attorney is useless

Post by RetiredAL »

Careful wrote: Mon Jun 05, 2023 7:26 am
Don’t I need a “receiving account” at Fidelity or Schwab? Since I am not a customer at either, I thought I should get some money in their first to be a legit customer, due to Know Your Customer laws. I realize that Fidelity is not a bank, but that does not matter to me.

Is this the easiest course of action since IB won’t accept the POA nor can my parents get direct access to IB customer, due to the problems I mentioned with no valid email with IB etc.

Let me know what you think!
In early 2019, I was dealing with POA issues with Wells Fargo Advisors for an IRA account of my Dad. I found Schwab local office was very willing to open an IRA account and transfer the IRA based on the existing POA lawyer created documents. Dad improved enough to go to the local office and sign everything himself, so I did not actually create the Schwab account using my POA authorizations. From then on, I did handle everything with that account as POA Agent.
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ResearchMed
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Re: Finding out your Power of Attorney is useless

Post by ResearchMed »

RetiredAL wrote: Mon Jun 05, 2023 4:31 pm
Careful wrote: Mon Jun 05, 2023 7:26 am
Don’t I need a “receiving account” at Fidelity or Schwab? Since I am not a customer at either, I thought I should get some money in their first to be a legit customer, due to Know Your Customer laws. I realize that Fidelity is not a bank, but that does not matter to me.

Is this the easiest course of action since IB won’t accept the POA nor can my parents get direct access to IB customer, due to the problems I mentioned with no valid email with IB etc.

Let me know what you think!
In early 2019, I was dealing with POA issues with Wells Fargo Advisors for an IRA account of my Dad. I found Schwab local office was very willing to open an IRA account and transfer the IRA based on the existing POA lawyer created documents. Dad improved enough to go to the local office and sign everything himself, so I did not actually create the Schwab account using my POA authorizations. From then on, I did handle everything with that account as POA Agent.

We also found Schwab very easy to work with, just a few years earlier, but without the person ever going in to the office at all, and also having no prior Schwab account.

We moved very elderly MIL cross country to an ALF (Assisted Living Facility) be closer to us, finally. Although she was still fully alert, she decided that she was done with dealing with finances, and asked DH to "please take care of *everything* from now on!" And she didn't want to go out anywhere again, etc. (except for medical needs).
He had her old DPOA naming him as agent, and additionally, he was a co-trustee (if that's the correct term?) of her trust.

So after getting MIL settled, we then went to the Schwab office right near our house (not so close to MIL), with her documents and account information from her non-Schwab account in her former state of residence.
He explained she was very elderly (mid-90's), competent, but just "didn't want to deal with any of this anymore". They took the documents and statements, and said they needed to have legal look at the DPOA and trust docs, which didn't take very long (a very few days). These docs had been executed years earlier.

The Schwab reps never blinked. They soon called and said the docs were in order, so we stopped by again, and got everything "done", with her new accounts now open and holdings transferred. They *never* insisted upon seeing her or even speaking with her, once DH made it clear that she did NOT want to do "any of that". The statements were sent to her, c/o DH at our address.
[We still wonder if they perhaps contacted her ALF to verify that she was there and her condition. They would have easily verified that DH was indeed the person "in charge", at her request, etc., if they had contacted her ALF.]

Then DH found some tattered old stock certificates she had, and we brought those over. We asked them to "please change these to electronic form and have them added to her Schwab account", and some time later, the shares showed up in her online account.

It was all very simple, using her old DPOA and trust documents... a great relief for all of us.

ETA: I should add that if *I* had needed to use my full agent authorization for DH's 403b account at Vanguard, it would have been a total mess. The 403b "full agent authorization" is almost useless once the person becomes incapacitated. It's apparently very restricted compared with a non-403b account, but that's no help for those of us with 403b accounts!

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Careful
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Re: Finding out your Power of Attorney is useless

Post by Careful »

miket29 wrote: Mon Jun 05, 2023 1:36 pm
Careful wrote: Mon Jun 05, 2023 7:26 am Perhaps the easiest thing would be for my dad to call his advisor and tell the advisor he wants to put his money with Fidelity or Schwab???? Dad can do that if I ask him to.
The advisor would send a check to my parents’ home presumably. I don’t live near them.
If they had a regular or trust account at Fidelity or Schwab, presumably it could be wired? It’s six figures so we hesitate to trust the mail.
Are they just holding cash in the current account? If not and they have investments then selling everything and having a check sent means they may end up with capital gains that they'd owe tax on. Instead you could have the assets transferred in-kind if they are stocks, bonds, mutual funds, and ETFs that Fidelity or Schwab can accept. There is no tax due when transfers are done in-kind since no sale occurs.
Thank you for this point! This makes total sense. Yes, a transfer in kind.

Also thanks to Lady Geek for helping me understand I can set up a POA account with zero.

I escalated things today from the financial advisor’s admin person to the advisor himself. Looks like IB will accept my POA after some verbal verification from my parents…fingers crossed anyway.

I will let the thread know if we succeed with IB since nobody else in this thread has dealt with them as far as I can tell. I really appreciate all the replies!
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Re: Finding out your Power of Attorney is useless

Post by HMSVictory »

I had a nightmare experience with TD Bank. I wanted to use my existing power of attorney for my wife to close an account and open a new one.

It's a durable power of attorney. I provided a copy of it to the bank manager and he refused to help me and said your wife has to complete the TD Bank forms and have them notarized. I asked him what about the power of attorney (that had been recorded at the Courthouse in the County we live in). He refused to accept it and said it was the banks policy not to accept a power of attorney that wasn't drafted within (2) years which is against the law here in PA. The law requires the bank to accept a valid POA.

Anyway, I ended up going to another branch of TD Bank and the manager there admitted to me that the other branch manager was wrong.

Luckily I wasn't in a bind and my wife wasn't incapacitated or anything like that, but it was eye opening for sure.
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Re: Finding out your Power of Attorney is useless

Post by secondcor521 »

My Dad executed a lawyer-prepared general durable POA which has been very helpful generally. Despite having that document, I'm fairly sure that he went through the Vanguard process and their paperwork to have me set up as full agent.

While in theory it would have been nice to provide the GDPOA to Vanguard and have them recognize it, I haven't come across anything yet that I have been prevented from doing via "full agent" access.

I can see all of his accounts, including an account for which he is trustee. For all those accounts, I can buy, sell, and exchange investments. I can set up dividend reinvestment. I can change cost basis methods. I can see statements and get tax forms. I can deposit checks to his Vanguard accounts, write checks on his Vanguard accounts, and move money back and forth between his Vanguard accounts and his local bank. I can call and ask questions of Vanguard about the accounts (after authenticating, of course). I think I can even change beneficiaries online, which I did once very carefully with my Dad's concurrence back when he had full mental acuity.

(ETA: I also can change his RMD tax withholding percentage. I think I could also change where his RMD comes from and his RMD schedule, but I haven't tried.)

Basically, everything I've needed to do so far at Vanguard with his accounts which I think of as being done using the GDPOA is actually done via the "full agent" authorization and has worked just fine so far.

YMMV.
Last edited by secondcor521 on Mon Jun 05, 2023 8:50 pm, edited 1 time in total.
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Re: Finding out your Power of Attorney is useless

Post by LadyGeek »

secondcor521 wrote: Mon Jun 05, 2023 7:06 pm Basically, everything I've needed to do so far at Vanguard with his accounts which I think of as being done using the GDPOA is actually done via the "full agent" authorization and has worked just fine so far.
That was my experience when I had full agent authorization for my Mom at Vanguard - including RMDs. Fidelity has a lot more limitations on what I can do online. It was far easier to rebalance her portfolio and take an RMD by using her online account directly than with my account and "full access".

:!: To those moving funds into Fidelity. As soon as you get your accounts setup, do the following:

Set your account dividends to automatically reinvest. The default is to distribute, so when the funds declare dividends you will find them in your core position (sweep account). You'll have to reinvest them yourself. Do this for taxable and tax-deferred accounts. If you want dividends distributed, that's fine. I just wanted to point this out.

Very important - For all new accounts, setup your beneficiary and contingent beneficiary designations. The default is to not have beneficiaries, which means they go to the owner's estate and are probated per the Will.

I don't know how Schwab works, but I'm betting you have to do something similar.
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Re: Finding out your Power of Attorney is useless

Post by bsteiner »

000 wrote: Mon Jun 05, 2023 4:11 pm
bsteiner wrote: Mon Jun 05, 2023 6:20 am I don’t know. A friend was in the Florida House until she was term limited so I can ask her. My guess is that they concluded that there were more problems with agents trying to show that the contingency had occurred (some lawyers made powers springing where it didn’t make sense, and some lawyers drafted powers requiring more than one doctor) as in Lady Geek’s case than there were with agents misbehaving with regular powers where the principal was competent.
Thanks. You can ask if you want, but please don't feel burdened to do so. I was wondering if there was a high volume of litigation concerning contingency and competency questions specific to Florida for some reason, but didn't (quickly) find a lot of coverage online.
She hasn’t responded yet.

I asked around a bit and got the sense that lawyers were making powers springing where it didn’t make sense (as appears to have been the case in Lady Geek’s case) and making the contingencies too difficult to satisfy (as also seems to have been the case in Lady Geek’s case).
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Re: Finding out your Power of Attorney is useless

Post by bsteiner »

LadyGeek wrote: Mon Jun 05, 2023 7:54 pm
Very important - For all new accounts, setup your beneficiary and contingent beneficiary designations. The default is to not have beneficiaries, which means they go to the owner's estate and are probated per the Will.
Please don’t name beneficiaries for taxable accounts without consulting competent trusts and estates counsel.

It makes it harder to deal with contingencies. What if a beneficiary predeceases you?

It makes it harder to provide for beneficiaries in trust rather than outright to keep their inheritances out of their estates for estate tax purposes and to protect their inheritances from their creditors and spouses and Medicaid.

What if your estate doesn’t have enough money to cover debts, taxes, expenses and preresiduary bequests and a beneficiary balks at contributing his/her share.

You have to make sure the beneficiary designations are consistent with your estate plan.

You have to update your beneficiary designations whenever you update your estate plan.

Note that you probate the Will, not the assets. In most cases in most states probating the Will is not difficult, expensive or burdensome.
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Re: Finding out your Power of Attorney is useless

Post by RetiredAL »

LadyGeek wrote: Mon Jun 05, 2023 7:54 pm
Very important - For all new accounts, setup your beneficiary and contingent beneficiary designations. The default is to not have beneficiaries, which means they go to the owner's estate and are probated per the Will.

I don't know how Schwab works, but I'm betting you have to do something similar.
Make sure copies of the Bene designations are kept with your estate documents as proof, also POA evidence as proof.

I had a dickens of a time when we dropped his Wells Fargo Advisor, who had always taken my POA instructions, but sans advisor the Wells Trade folks said their computer did not list me as being POA, just view rights. Since under Advisor control you can't trade, only the advisor can, this was not caught until we tried to convert his IRAs to Wells Trade. Then Dad took ill before either he or I could get it straightened out. Then I/we went to Schwab and had them suck the accounts away from WF.

Schwab's Bene process is similar to Fidelity, both are done by on-line transaction.

The on-line nature of these designations is why one should save proof. I do screen captures.
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Re: Finding out your Power of Attorney is useless

Post by LadyGeek »

bsteiner wrote: Mon Jun 05, 2023 8:14 pm I asked around a bit and got the sense that lawyers were making powers springing where it didn’t make sense (as appears to have been the case in Lady Geek’s case) and making the contingencies too difficult to satisfy (as also seems to have been the case in Lady Geek’s case).
Sorry, I didn't supply the details on my POA. The situation under which the powers sprung did indeed make sense and were appropriate for my parents situation. There were contingencies in the POA. I just happened to be the primary and the situation was fairly straight-forward to proceed with what was needed.

The fact that the attorney required two physician statements to invoke the POA is exactly what should be done to protect my parents' interests - the people he was representing.
bsteiner wrote: Mon Jun 05, 2023 8:22 pm
LadyGeek wrote: Mon Jun 05, 2023 7:54 pm
Very important - For all new accounts, setup your beneficiary and contingent beneficiary designations. The default is to not have beneficiaries, which means they go to the owner's estate and are probated per the Will.
Please don’t name beneficiaries for taxable accounts without consulting competent trusts and estates counsel.

It makes it harder to deal with contingencies. What if a beneficiary predeceases you?

It makes it harder to provide for beneficiaries in trust rather than outright to keep their inheritances out of their estates for estate tax purposes and to protect their inheritances from their creditors and spouses and Medicaid.

What if your estate doesn’t have enough money to cover debts, taxes, expenses and preresiduary bequests and a beneficiary balks at contributing his/her share.

You have to make sure the beneficiary designations are consistent with your estate plan.

You have to update your beneficiary designations whenever you update your estate plan.

Note that you probate the Will, not the assets. In most cases in most states probating the Will is not difficult, expensive or burdensome.
Sorry, I was stating things which apply for my situation. Others should follow bsteiner's advice.
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Re: Finding out your Power of Attorney is useless

Post by RationalWalk »

I found that the problem with Vanguard's Agent Authorization was that it does not provide for contingent Agents if my designated agent were unable to serve. To handle this in a crude manner, you have to name multiple Agents, all with full powers, and they have to acknowledge, which makes them all aware that they have immediate authority. I really don't find that to be desirable - I don't want several people running around who all have immediate access to my accounts. My attorney-drafted DPOA names a primary and then sequential contingent Agents, which is the what most people would prefer, IMO. But Vanguard won't accept that.
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Re: Finding out your Power of Attorney is useless

Post by ResearchMed »

RationalWalk wrote: Tue Jun 06, 2023 12:38 pm I found that the problem with Vanguard's Agent Authorization was that it does not provide for contingent Agents if my designated agent were unable to serve. To handle this in a crude manner, you have to name multiple Agents, all with full powers, and they have to acknowledge, which makes them all aware that they have immediate authority. I really don't find that to be desirable - I don't want several people running around who all have immediate access to my accounts. My attorney-drafted DPOA names a primary and then sequential contingent Agents, which is the what most people would prefer, IMO. But Vanguard won't accept that.

Double check about their "accepting" YOUR DPOA, and push them.

There is that PA law, now several years old, that any business in PA *must* accept a valid outside power of attorney form.
Finding someone at Vanguard willing to acknowledge that? That's another issue...
We've had someone there (a "senior someone") flat out say, "I don't care!".
Nice.

And fortunately, Employer yanked the 403b plan away from Vanguard a few years ago. :happy

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Re: Finding out your Power of Attorney is useless

Post by bsteiner »

LadyGeek wrote: Tue Jun 06, 2023 6:19 am ...
Sorry, I didn't supply the details on my POA. The situation under which the powers sprung did indeed make sense and were appropriate for my parents situation. There were contingencies in the POA. I just happened to be the primary and the situation was fairly straight-forward to proceed with what was needed.

The fact that the attorney required two physician statements to invoke the POA is exactly what should be done to protect my parents' interests - the people he was representing.
...
Springing powers sometimes make sense. They most often come up where the agent isn't a close relative (such as a niece or nephew), or the agent is a young adult child.

The typical condition is that a doctor certifies that the principal is unable to handle his/her affairs.

Of course, in an emergency, it may take some time to obtain the necessary certification.

I don't recall seeing one that required two doctors but you can have any condition you want (except in Florida).

We've had several cases where powers of attorney were useful. Before New York changed its estate tax law in 2014 to include gifts within 3 years in the estate, we had a case where someone gave away about $8 million worth of bonds in the few days before her death to avoid the New York estate tax on them. She was able to do it herself but if she couldn't, her agents could have done it for her.

But we had a case where a power of attorney was harmful. The principal had given his secretary a power of attorney. In the year before his death, the agent transferred about $20 million of assets to persons other than the beneficiaries under the principal's Will.
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Re: Finding out your Power of Attorney is useless

Post by tadamsmar »

LadyGeek wrote: Wed Sep 14, 2022 6:02 pm All of this together means that I have little confidence in Vanguard handling transitions to inherited accounts in a timely manner when she passes. (Hopefully, that won't be for a long time...). So, goodbye Vanguard.
Vanguard handled transition (from my wife's mother to my wife) of inherited assets in a timely manner. My wife was the named beneficiary on the taxable account and the assets were transferred to my wife's Vanguard account. The process was easy to accomplish.

Edit: But I seem to recall that Fidelity is more flexible about the use of "per stirpes".
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Re: Finding out your Power of Attorney is useless

Post by RationalWalk »

ResearchMed wrote: Tue Jun 06, 2023 12:51 pm
RationalWalk wrote: Tue Jun 06, 2023 12:38 pm I found that the problem with Vanguard's Agent Authorization was that it does not provide for contingent Agents if my designated agent were unable to serve. To handle this in a crude manner, you have to name multiple Agents, all with full powers, and they have to acknowledge, which makes them all aware that they have immediate authority. I really don't find that to be desirable - I don't want several people running around who all have immediate access to my accounts. My attorney-drafted DPOA names a primary and then sequential contingent Agents, which is the what most people would prefer, IMO. But Vanguard won't accept that.

Double check about their "accepting" YOUR DPOA, and push them.

There is that PA law, now several years old, that any business in PA *must* accept a valid outside power of attorney form.
Finding someone at Vanguard willing to acknowledge that? That's another issue...
We've had someone there (a "senior someone") flat out say, "I don't care!".
Nice.

And fortunately, Employer yanked the 403b plan away from Vanguard a few years ago. :happy

RM
My concern is that whatever someone at Vanguard says, I don't have sufficient confidence that the terms of my DPOA will be honored when the time comes; in particular the recognition of contingent Agents. There doesn't seem to me to be any way to "test" this very convincingly as might be the case if I were pretending the be the primary Agent. I suppose this could be the case with any financial institution, but the red flags regarding Vanguard are particularly concerning to me. For me, a desirable scenario would be that the financial institution provides me with written acknowledgement that my DPOA has been approved and accepted. At least my hapless Agents would have this in hand if needed. But does anybody provide this, or do you have to take the word of some Joe Shmo that all is well?
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Re: Finding out your Power of Attorney is useless

Post by Careful »

So I've been trying to get my POA accepted at Interactive Brokers for months. My parents had never logged in and had lost their email address (as it was tied to a previous internet provider) so verifying them was difficult. They have a financial advisor in the mix too. Supposedly he was working the system to get it accepted.

I spent 4.5 hours on the phone (in two phone calls) with Interactive Brokers to get online access to their four different accounts (IRAs for each of them, couple others). I was told my POA would be ready within 24-48 hours. I have access now, after all that, but 'as them.' Not really right.

Now, four days later, they tell me: "Please know none of these three accounts have a POA set up. A POA Agent is only given formal account access in the event of a medically necessary incapacity (or something like incarceration). If 'dad' or 'mom' need to add a POA for convenience to any of their accounts, this can be done themselves within the Client Portal/Access Rights. They can add multiple people if they'd like and even choose the level of access their additional User(s) would have."

...as if they hadn't already assured me it was in processing.

From reports upthread, it looks like I 'lose something' if I use IB's online form, as the agent suggests, rather than the 20-page, lawyer-made, specific-to-their-state POA.

What do you all think? I could:

1. log in as them and do their POA (they are fine with any of that).
2. work on an asset transfer to Fidelity or Schwab.
3. Continue to harrass IB to accept the POA.

What would you all advise?

Thank you.
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Re: Finding out your Power of Attorney is useless

Post by HomeStretch »

Careful wrote: Fri Jun 30, 2023 3:34 pm

… I have access now, after all that, but 'as them.' Not really right. …

Now, four days later, they tell me: "Please know none of these three accounts have a POA set up. A POA Agent is only given formal account access in the event of a medically necessary incapacity (or something like incarceration). If 'dad' or 'mom' need to add a POA for convenience to any of their accounts, this can be done themselves within the Client Portal/Access Rights. They can add multiple people if they'd like and even choose the level of access their additional User(s) would have." …

What do you all think? …
Asset transfer to the more POA-friendly Fidelity or Schwab ASAP. As your parents’ agent, the last thing you want/need is to have an access issue to their accounts while dealing with care matters.
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Re: Finding out your Power of Attorney is useless

Post by beyou »

While I did have any atty draft a DPOA doc as part of a suite of docs we also created trusts. One of the reasons for trust vs beneficiary was to name a successor trustee not just in death but also for incapacity. A broker would need a medical statement saying I am incapacitated, and then they need to accept the new trustee.

And for small assets like checking accts outside the trust, adding a joint acct holder is useful. My spouse is joint, and if ever one of us was incapacitated, the other could add our trustee from trust as joint on non trust checking acct. Or the trustee can use brokerage cash mgmt features or even open their own bank acct to link to brokerage once they are officially trustee.

To me, the POA is for vague use outside investing and bill paying. Not sure how we’ll ever use it, but can’t hurt to have one.
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Re: Finding out your Power of Attorney is useless

Post by bsteiner »

beyou wrote: Fri Jun 30, 2023 5:03 pm While I did have any atty draft a DPOA doc as part of a suite of docs we also created trusts. One of the reasons for trust vs beneficiary was to name a successor trustee not just in death but also for incapacity. A broker would need a medical statement saying I am incapacitated, and then they need to accept the new trustee.

And for small assets like checking accts outside the trust, adding a joint acct holder is useful. My spouse is joint, and if ever one of us was incapacitated, the other could add our trustee from trust as joint on non trust checking acct. Or the trustee can use brokerage cash mgmt features or even open their own bank acct to link to brokerage once they are officially trustee.

To me, the POA is for vague use outside investing and bill paying. Not sure how we’ll ever use it, but can’t hurt to have one.
WIth a power of attorney the agent usually wouldn't need a medical statement to act.
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Re: Finding out your Power of Attorney is useless

Post by Careful »

HomeStretch wrote: Fri Jun 30, 2023 5:01 pm
Careful wrote: Fri Jun 30, 2023 3:34 pm

… I have access now, after all that, but 'as them.' Not really right. …

Now, four days later, they tell me: "Please know none of these three accounts have a POA set up. A POA Agent is only given formal account access in the event of a medically necessary incapacity (or something like incarceration). If 'dad' or 'mom' need to add a POA for convenience to any of their accounts, this can be done themselves within the Client Portal/Access Rights. They can add multiple people if they'd like and even choose the level of access their additional User(s) would have." …

What do you all think? …
Asset transfer to the more POA-friendly Fidelity or Schwab ASAP. As your parents’ agent, the last thing you want/need is to have an access issue to their accounts while dealing with care matters.
I’m really trying. Kind of burnt out after spending most of a day on the phone with IB. But with my durable POAs and online access (as them), you think I could just call up Fidelity and provide them the POAs? What are the exact steps? Sorry like I said I’m kind of burnt out!
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Re: Finding out your Power of Attorney is useless

Post by beyou »

bsteiner wrote: Fri Jun 30, 2023 6:05 pm
beyou wrote: Fri Jun 30, 2023 5:03 pm While I did have any atty draft a DPOA doc as part of a suite of docs we also created trusts. One of the reasons for trust vs beneficiary was to name a successor trustee not just in death but also for incapacity. A broker would need a medical statement saying I am incapacitated, and then they need to accept the new trustee.

And for small assets like checking accts outside the trust, adding a joint acct holder is useful. My spouse is joint, and if ever one of us was incapacitated, the other could add our trustee from trust as joint on non trust checking acct. Or the trustee can use brokerage cash mgmt features or even open their own bank acct to link to brokerage once they are officially trustee.

To me, the POA is for vague use outside investing and bill paying. Not sure how we’ll ever use it, but can’t hurt to have one.
WIth a power of attorney the agent usually wouldn't need a medical statement to act.
Yes but since many firms won't take your own custom POA document and will take copies of your trust and follow instructions,
seems more practical to line up such a backup plan via a trust (unless this is the only reason to have the trust but it never is).

That said, I was being rhetorical to say "not sure how we'll ever use it (DPOA)".
There are lots of cases where it could be useful IF THE OTHER PARTY ACCEPTS IT.
Many items are not controlled by or owned by a trust even if you have one.
IRA, 401k, Insurance etc, only bring my trustees into service upon death, not upon incapacity, as the trust is the beneficiary not owner of such accounts.
I do hope when the time comes my trusted persons will be able to use the POA we drafted.
My attorney insists that there are laws governing that standard form POA must be accepted by financial institutions, yet we still have people reporting
that the documents are not accepted by banks and brokers. Hard to understand why this cannot be standardized. I do understand why it must be, too much risk of fraud without controls in place.
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Re: Finding out your Power of Attorney is useless

Post by HomeStretch »

Careful wrote: Fri Jun 30, 2023 6:18 pm
HomeStretch wrote: Fri Jun 30, 2023 5:01 pm
Careful wrote: Fri Jun 30, 2023 3:34 pm
… What do you all think? …
Asset transfer to the more POA-friendly Fidelity or Schwab ASAP. As your parents’ agent, the last thing you want/need is to have an access issue to their accounts while dealing with care matters.
I’m really trying. Kind of burnt out after spending most of a day on the phone with IB. But with my durable POAs and online access (as them), you think I could just call up Fidelity and provide them the POAs? What are the exact steps? Sorry like I said I’m kind of burnt out!
I transferred my parents’ POA accounts to Fidelity last year after an issue at another long-term brokerage. I started the process at Fidelity with a form and the POA which I took into the local Fidelity office to be notarized. It was pretty easy. I had to order checks (by form) and a debit card (online) in separate steps. There are a couple things Fidelity won’t let you online as a POA when you are logged into your own online account. You can call to have a rep do it.

LadyGeek has a thread with details on “how to” about her parent’s POA transfer to Fidelity. I’ll edit my post with a link if I can find it.
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Re: Finding out your Power of Attorney is useless

Post by Careful »

That sounds good. It would be a relief. I can get to a Fidelity office pretty easily after the holiday.
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Re: Finding out your Power of Attorney is useless

Post by SailorManDan »

by HomeStretch » Fri Jun 30, 2023 8:35 pm

LadyGeek has a thread with details on “how to” about her parent’s POA transfer to Fidelity. I’ll edit my post with a link if I can find it.
I think the "how to" was further upthread.

Thanks to everyone here I have successfully transferred my parents accounts from Vanguard to Fidelity. I was having problems with Vanguard (viewtopic.php?t=404301) over a POA issue and stumbled upon this thread. Fidelity made the process easy as a personal rep was assigned to me and was everything was completed in week or so. Even though I do not have "full access" (yes, I've read LadyGeeks suggestion on how she did this with her mother) most things can be done online and the rest through a simple phone call or a stop in to the local branch. I'm very glad to have completed all this before my fathers dementia worsens. Thanks again.
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Re: Finding out your Power of Attorney is useless

Post by RationalWalk »

One more concern I have: I've raised this issue of Vanguard not accepting the DPOA that he prepared for me. All I got in response was his assurance that they "have to" accept and that it should be "no problem". I'm thinking his assurance is based on dealing with local financial firms with brick offices you can walk into and he doesn't have a clue about remote outfits you can only deal with via phone and internet. He also assured me that since the DPOA authorizes my agent to access any online accounts of mine that should take care of the matter. But I'm doubting that is actually the case and that if Vanguard learned of this there would be a big problem.
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Re: Finding out your Power of Attorney is useless

Post by Careful »

SailorManDan wrote: Sun Jul 02, 2023 11:34 am
by HomeStretch » Fri Jun 30, 2023 8:35 pm

LadyGeek has a thread with details on “how to” about her parent’s POA transfer to Fidelity. I’ll edit my post with a link if I can find it.
I think the "how to" was further upthread.

Thanks to everyone here I have successfully transferred my parents accounts from Vanguard to Fidelity. I was having problems with Vanguard (viewtopic.php?t=404301) over a POA issue and stumbled upon this thread. Fidelity made the process easy as a personal rep was assigned to me and was everything was completed in week or so. Even though I do not have "full access" (yes, I've read LadyGeeks suggestion on how she did this with her mother) most things can be done online and the rest through a simple phone call or a stop in to the local branch. I'm very glad to have completed all this before my fathers dementia worsens. Thanks again.
Excellent news, SailorManDan! I have started the process with Fidelity (from Interactive Brokers). They happily accepted my durable power of attorney for each of my parents. I signed a lot of papers and everything was notarized. Fingers crossed it is smooth from here. It is light years better from my experience with Interactive. And my parents are happy with it, too. So here's hoping!
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Re: Finding out your Power of Attorney is useless

Post by Careful »

As an update, some weeks ago, my parents' holdings finally transferred from Interactive Brokers to Fidelity. There were some bumps in the road and in fact there is still one thing that is still sitting at their previous broker (a partial t-bill), but it's minor so I'm worrying about other things now.

Note that Fidelity did have to overnight paperwork to my parents to sign and date, after I signed and dated everything in Fidelity's office as POA (witnessed and notarized). So it's a good thing my parents are still ok to sign stuff - a word of warning.

I was also unable to link their outside bank account to Fidelity as POA (for easy back and forth). But logging in as my mother, I could do so.

I hope this is helpful to others.
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Re: Finding out your Power of Attorney is useless

Post by LadyGeek »

Yes, that's why I created the account as my Mom (account creation permitted as POA). You can do everything you need.

There must have been a quirk with your POA, as no additional signatures were needed for mine (durable POA). That's why they have lawyers review those documents.
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Re: Finding out your Power of Attorney is useless

Post by HomeStretch »

My experience with creating Fidelity POA/owner accounts for each of my parents and transferring their Vanguard accounts to Fidelity was the same as LadyGeek’s. No paperwork was needed from my parents. Which was a good thing as one of my parents was incapacitated and unable to sign anything.
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Re: Finding out your Power of Attorney is useless

Post by kodiac »

Both in 2021 and again in August 2023 wnet through this with Vanguard who in both instances hasn't accepted the NY State durable power of attorney drawn up by a lawyer. In 2021 submitted their full agent authority but they said issued for one of us two only limited (this become an issue this August.) They supposed, again, sent the full authority paperwork to the party weeks ago who hasn't received the docs. Vanguard has truly become exasperating as others have said.
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Re: Finding out your Power of Attorney is useless

Post by ResearchMed »

kodiac wrote: Mon Sep 04, 2023 2:09 pm Both in 2021 and again in August 2023 wnet through this with Vanguard who in both instances hasn't accepted the NY State durable power of attorney drawn up by a lawyer. In 2021 submitted their full agent authority but they said issued for one of us two only limited (this become an issue this August.) They supposed, again, sent the full authority paperwork to the party weeks ago who hasn't received the docs. Vanguard has truly become exasperating as others have said.

As of last month, Vanguard is *still* not accepting a valid DPOA that is on a form other than their own?
Sheesh.
That could be *such* a problem for someone no longer competent to sign a new document.

When was that PA law enacted, that required acceptance of outside POAs by any company doing business in PA...?

I thought I had read here that Vanguard and started to acknowledge that law.
Or has something changed in the legal situation?

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Re: Finding out your Power of Attorney is useless

Post by cas »

ResearchMed wrote: Mon Sep 04, 2023 2:41 pm
kodiac wrote: Mon Sep 04, 2023 2:09 pm Both in 2021 and again in August 2023 wnet through this with Vanguard who in both instances hasn't accepted the NY State durable power of attorney drawn up by a lawyer.
Or has something changed in the legal situation?
At least part of this issue is this Pennsylvania Supreme Court decision, which put financial companies operating in Pennsylvania (Vanguard is headquartered in PA) between a rock and a hard place with respect to accepting general durable POAs. Even at that time (2010), the PA law required the financial institution to accept the durable POA, but...
However, in Vine v. State Employees' Retirement Board, the Supreme Court ruled that there is no third party immunity if the power of attorney itself is not valid. This presents a real problem for all those "third parties," like banks. The problem is that a power of attorney is not valid if the principal is not legally competent when he or she signs it. Furthermore, a power of attorney can be revoked at any time by a competent individual. It is essentially impossible for any third party to know whether a principal was competent when the power of attorney was signed. Similarly, there is no way to know whether a power of attorney has been revoked, if the agent has the original power of attorney to show to bankers, or stock brokers, or other third parties. The Supreme Court's ruling now effectively requires that the third parties verify that the principal was competent when the power of attorney was drafted and that the principal has not revoked it. Basically, that's an impossible task, and raises the possibility that banks and other third parties will no longer honor powers of attorneys.
An additional problem at that time was that Pennsylvania law regarding durable POA did not comply with Uniform Power of Attorney Act, which introduced complications for financial institutions in PA in accepting durable POA drafted under another state's laws.

The PA legislature seems to have been trying every 2 to 4 years to fix PA law with respect to these problems, but apparently they keep not succeeding adequately, because they keep redoing it every 2 to 4 years. IANAL (or a PA resident), much less a lawyer with expertise in this particular sub-specialty, so following the legalese on exactly what the problem is at this point is beyond my interest and capabilities.

For additional reading, here is an additional (federal) lawsuit from someone who got irritated at all this and sued Vanguard. (spoiler: Vanguard won, but the plaintiff complicated his problems by his own behavior. One of the judge's comments:
Under the circumstances, Vanguard's requirements were clearly reasonable and did not breach the contractual requirements. The issue is not, of course, whether Vanguard provided good customer service to Peter, or whether it might not have found a way to resolve the dispute in a prompt and more amicable fashion. Nor is the issue whether Peter brought the problem upon himself by his own stubbornness and inflexibility. The issue is simply whether Vanguard breached the 2012 CAA. Because it did not, summary judgment will be granted to Vanguard as to that claim.
)
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Re: Finding out your Power of Attorney is useless

Post by cas »

kodiac wrote: Mon Sep 04, 2023 2:09 pm [...]They supposed, again, sent the full authority paperwork to the party weeks ago who hasn't received the docs. Vanguard has truly become exasperating as others have said.
If the person needing the paperwork has an online account and a printer (and I realize not everyone does, especially when elderly), then the paperwork is available online. Log in, type "agent authorization" in the search and then follow the prompts. For full agent authorization the end result is that they ask you to print out a pdf to take somewhere for the notarization + witness signatures.
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Re: Finding out your Power of Attorney is useless

Post by exodusing »

cas wrote: Mon Sep 04, 2023 4:01 pm
ResearchMed wrote: Mon Sep 04, 2023 2:41 pm
kodiac wrote: Mon Sep 04, 2023 2:09 pm Both in 2021 and again in August 2023 wnet through this with Vanguard who in both instances hasn't accepted the NY State durable power of attorney drawn up by a lawyer.
Or has something changed in the legal situation?
At least part of this issue is this Pennsylvania Supreme Court decision, which put financial companies operating in Pennsylvania (Vanguard is headquartered in PA) between a rock and a hard place with respect to accepting general durable POAs. Even at that time (2010), the PA law required the financial institution to accept the durable POA, but...
However, in Vine v. State Employees' Retirement Board, the Supreme Court ruled that there is no third party immunity if the power of attorney itself is not valid. This presents a real problem for all those "third parties," like banks. The problem is that a power of attorney is not valid if the principal is not legally competent when he or she signs it. Furthermore, a power of attorney can be revoked at any time by a competent individual. It is essentially impossible for any third party to know whether a principal was competent when the power of attorney was signed. Similarly, there is no way to know whether a power of attorney has been revoked, if the agent has the original power of attorney to show to bankers, or stock brokers, or other third parties. The Supreme Court's ruling now effectively requires that the third parties verify that the principal was competent when the power of attorney was drafted and that the principal has not revoked it. Basically, that's an impossible task, and raises the possibility that banks and other third parties will no longer honor powers of attorneys.
An additional problem at that time was that Pennsylvania law regarding durable POA did not comply with Uniform Power of Attorney Act, which introduced complications for financial institutions in PA in accepting durable POA drafted under another state's laws.
<snip>
Under that standard, I wonder why Vanguard's authorization form works better than a typical durable POA. Maybe it's not considered a POA and therefore doesn't have to comply?
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Re: Finding out your Power of Attorney is useless

Post by cas »

exodusing wrote: Mon Sep 04, 2023 4:39 pm
Under that standard, I wonder why Vanguard's authorization form works better than a typical durable POA. Maybe it's not considered a POA and therefore doesn't have to comply?
IANAL, but my guess ...

The full agent authorization form
1. Is specifically a *Pennsylvania* durable power of attorney, which gets around any problems with taking general durable POA documents drawn up under another state's laws
2. I think the signatures/notary on the full agent authorization form have to have been done very recently (I don't recall the time limit, but less than a month?) at the time Vanguard accepts the form, so that cuts down on the possibility of the person having changed their mind in the meantime. (i.e. it can't have been all signed and witnessed 10 years ago, with instructions to the agent to present it to Vanguard only when it becomes needed.) And I think there is a specific written method that has to be presented to Vanguard in order to revoke it, so it can't have been revoked without Vanguard knowing.
3. IIRC, has a section in there specifically releasing Vanguard from liability if they accept and act upon what is, to all appearances, a validly signed form.
Last edited by cas on Mon Sep 04, 2023 5:09 pm, edited 1 time in total.
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Re: Finding out your Power of Attorney is useless

Post by FreddieFIRE »

LadyGeek wrote: Mon Sep 04, 2023 1:57 pm Yes, that's why I created the account as my Mom (account creation permitted as POA). You can do everything you need.
Are you discussing creation of an actual brokerage account, or registering as a new user of the on-line system in order to access a brokerage account?
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Re: Finding out your Power of Attorney is useless

Post by LadyGeek »

After the assets were transferred from Vanguard and the account was established, I created an online login as my Mom. The POA allows me to do that. Fidelity confirmed my ability to create the login.

I also have "full access" to my Mom's account from my own, but there are a number of limitations which restricts me from doing things like trades and taking care of her RMD. So, the account as "her" is the best approach.

I could also call Fidelity and do everything I need as POA, but online is best for me.
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Re: Finding out your Power of Attorney is useless

Post by FreddieFIRE »

LadyGeek wrote: Mon Sep 04, 2023 6:08 pm After the assets were transferred from Vanguard and the account was established, I created an online login as my Mom. The POA allows me to do that. Fidelity confirmed my ability to create the login.
Did Fidelity confirm this in writing? And, if so, did they confirm that any losses that may occur while you're logged in as your mom would be reimbursed under their Customer Protection Guarantee?

https://www.fidelity.com/security/custo ... -guarantee
I could also call Fidelity and do everything I need as POA, but online is best for me.
I'm sure that most here would agree that online is easier. My concern is that Fidelity requires a phone call for reasons that we may not fully understand. I'm dubious that they would bless your simple work-around.
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Re: Finding out your Power of Attorney is useless

Post by LadyGeek »

Fidelity confirmed by phone call - by my calling the main support number and then discussing this with the local Fidelity advisor.

I may have also had this in a secure message from Fidelity, but they're automatically deleted after 90 days.

I don't see any difference between doing business by phone or with an online account as POA.

When my Mom and I were both at Vanguard, I was able to do everything I needed from my own account - including trades and managing her RMD. The only difference with Fidelity is that a dedicated login is needed to do the same things I could do at Vanguard.
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Re: Finding out your Power of Attorney is useless

Post by FreddieFIRE »

LadyGeek wrote: Mon Sep 04, 2023 6:08 pm I also have "full access" to my Mom's account from my own, but there are a number of limitations which restricts me from doing things like trades and taking care of her RMD. So, the account as "her" is the best approach.
Just fyi. I'm in a similar situation and was able to initiate a trade today (4 week T-bills at auction). What kind of trade have you been prohibited from executing?
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Re: Finding out your Power of Attorney is useless

Post by LadyGeek »

I was going by memory. Checking this again under my own account, I can execute a trade, but not a transfer. Only my own accounts show in the Transfer menu drop-down selection.
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Re: Finding out your Power of Attorney is useless

Post by FreddieFIRE »

LadyGeek wrote: Tue Sep 05, 2023 5:58 pm I was going by memory. Checking this again under my own account, I can execute a trade, but not a transfer. Only my own accounts show in the Transfer menu drop-down selection.
Thanks. Same here. Fortunately, transfers will be a much more rare occurrence for me. Does Bill Pay work under your POA access?
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Re: Finding out your Power of Attorney is useless

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Sorry, I don't use Bill Pay myself or for my Mom.
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Re: Finding out your Power of Attorney is useless

Post by Dead Man Walking »

The Ohio State Bar Association website explains Financial Powers of Attorney and summarizes Ohio’s Uniform Power of Attorney Act which became effective 3/22/2012. An Ohio Power of Attorney is durable unless it expressly states otherwise. Third parties such as financial institutions are NOT required to honor POAs.

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Re: Finding out your Power of Attorney is useless

Post by FreddieFIRE »

LadyGeek wrote: Tue Sep 05, 2023 8:04 pm Sorry, I don't use Bill Pay myself or for my Mom.
I've never used it for myself. Surprisingly, there are still entities out there that require monthly payments only by check in the mail. Bill Pay looks like a good option for that versus writing a check, filling out an envelope, using a first class stamp and making a trip to the mail box. Otherwise, I set up autopay wherever possible.
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Accepting Power of Attorney

Post by AAA »

[Thread merged into here --admin LadyGeek]

I recently learned that Vanguard will not accept a properly prepared Power of Attorney document, e.g., done by lawyer, notarized and witnessed, but requires the use of their own form which also has to be notarized and witnessed. It appears Fidelity has the same policy.

How is it possible that they can refuse to honor a proper legal document? Would there be any recourse if someone only found out about this policy when it was too late? Also, is this common at other financial institutions?
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Re: Accepting Power of Attorney

Post by RetiredAL »

AAA wrote: Fri Sep 15, 2023 5:42 pm I recently learned that Vanguard will not accept a properly prepared Power of Attorney document, e.g., done by lawyer, notarized and witnessed, but requires the use of their own form which also has to be notarized and witnessed. It appears Fidelity has the same policy.

How is it possible that they can refuse to honor a proper legal document? Would there be any recourse if someone only found out about this policy when it was too late? Also, is this common at other financial institutions?
Schwab will readily accept a lawyer created POA. Note that different forms are used for internal vs external. A call to a local office can get the right form sent to you.

I have not looked at Fidelity the last few years, but they used to just a few years ago. It was a different form than the standard Fidelity POA form and somewhat hard to find. Fidelity now has gone to an excellent all on-line process for the Fidelity POA.

It is fairly common for financial institutions was want their own POA forms to be used. The reason is simple: Their standard internal POA is processed by a clerk. An external POA means that their lawyers to review it.

edit to add:
I believe this is the form you submit along with the existing POA.

https://www.fidelity.com/bin-public/060 ... cation.pdf
Last edited by RetiredAL on Fri Sep 15, 2023 6:04 pm, edited 1 time in total.
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Re: Accepting Power of Attorney

Post by cas »

You may be interested in the "Finding out your Power of Attorney is useless" thread and possibly particularly interested in the part of the discussion that starts here about individual state level legal code (e.g. Uniform Power of Attorney Act participation or lack thereof) and case law (e.g. liability exposure) that may possibly be part of the reasons leading to the type of thing you are seeing.
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Re: Accepting Power of Attorney

Post by cas »

AAA wrote: Fri Sep 15, 2023 5:42 pm I recently learned that Vanguard will not accept a properly prepared Power of Attorney document, [ . . .]
Also, Vanguard lists an level of agent authorization called Agent Authorization for an Incapacitated Person that seems to be able to use a general durable POA in a pinch, with reportedly significant limitations and extra certification of validity. I don't recall anyone on bogleheads reporting using it in many years, and I have absolutely no idea of how the limitations and requirements have or have not evolved as the Pennsylvania legislature had tried to fix some of the problems with the way their legal code deals with POA in Pennsylvania (see discussion I linked above). (PA is relevant because Vanguard is headquartered in PA.)
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Re: Accepting Power of Attorney

Post by HomeStretch »

Fidelity accepts an attorney drafted DPOA. Complete their form, attach the DPOA and have it notarized (a local office will do it).
https://www.fidelity.com/customer-servi ... f-attorney

Vanguard will not accept an attorney drafted DPOA (or st least not a few years ago). You can make someone an agent. I managed my parents’s accounts as full agent for years until I ran into issues last year with their inexperienced CSRs. As one parent was incapacitated, I lost confidence in Vanguard and transferred their accounts to Fidelity which is much more POA friendly and accepted their attorney drafted DPOAs.
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