Yes he's protected, but he should get his own criminal defense lawyer.
Your sister must have gone to the police. Criminal defense lawyers defend, they don't prosecute.
Your father, as a joint owner of an account is entitled to the money in the account on their own behalf. If your aunt was your grandmother's "attorney in fact" with a power of attorney signed by your grandmother, she had authority to act for your grandmother, but your father still was entitled to sue the joint account.
I don't know what you mean by "she had given the money to your dad." If that was true, then it wouldn't have been in their joint account.
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