Does a person with financial power of attorney, for someone,have to be accountable for how they manage that person's money?
Estate Planning Attorney
In a simple word, yes. The attorney-in-fact has a fiduciary duty to the principal to manage the money in the best interest of the principal.
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Estate Planning Attorney
Not only are they accountable to the principal they are accountable to the principal's Guardian, if any; the personal representative of the principal's estate upon the principals death; plus any prospective heir can ask the Court to require an accounting if they can show the principal is incapacitated and there is doubt or concern over the actions of the agent.
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Yes. The attorney-in-fact has a fiduciary duty to the principal that must not be abrogated or misused. An attorney-in-fact who abuses his or her authority is liable to the principal for damages.
Where a POA is in force, the type of POA is important - a limited power where authority is shared with the principal requires (in many instances) the attorney-in-fact to answer to the principal on numerous occasions and it may be more difficult to abuse the authority. However, where the POA exists because the principal is incapacitated and cannot make his/her own decisions, the attorney-in-fact may have more ability to misuse the funds.
It's also worth noting that an attorney-in-fact who reasonably acts in the best interests of the principal may not be abusing the fiduciary relationship, even if money is lost, if such losses are not foreseeable, or if the risk is not able to be mitigated (such as investments in the stock market).
Speak with an attorney if you believe someone you know is a principal whose attorney-in-fact may be abusing the fiduciary relationship. Or, if you're the attorney-in-fact and you have concerns about your actions, speak with counsel.
The foregoing is not legal advice, and nothing in the foregoing shall be deemed to create an attorney client relationship. If you feel you need to speak with an attorney regarding your issue, it is recommended that you contact an attorney with expertise in your area of inquiry. The information related above is purely for informational purposes, and should not be acted upon without speaking with qualified counsel familiar with you specific situation and the laws related thereto.