Will Your Financial Institution Accept Your Legal Documents?

Banks, brokerage firms, and investment companies are cracking down on the policies pertaining to a person's use of a General Durable Power of Attorney (GDPOA) to conduct account changes or transactions on behalf of the account holder.  Changing beneficiary designations can be an integral part of estate planning, and the task of doing so is sometimes executed by a person other than the actual account holder.

We realize that the activity of liquidating accounts or changing beneficiary designations by someone other than the account holder can be viewed by financial institutions as a questionable activity.  However, sometimes the account holder is unable to make account changes himself or herself due to an illness or other reason that prohibits him or her from doing so.  The agent listed in the GDPOA needs to be able to conduct the account transactions quickly without getting push back from the financial institution about the agent's authority to do so.  Unfortunately, sometimes the financial institution refuses to cooperate.

Banks are usually more willing to accept a GDPOA, but we know for a fact that at least two well-known investment companies will not accept any powers of attorney other than the internal POA forms that the investment companies have created themselves.  Another investment company will accept a GDPOA other than its own form but requires additional documentation submitted by an attorney that validates the authenticity of the GDPOA before allowing an agent to conduct transactions on an account holder's behalf.

The moral of the story is that you shouldn't automatically assume that a financial institution will accept your GDPOA.  We suggest that you contact your financial institutions and ask what their requirements are for you to allow another person to conduct business on your behalf.  You should be proactive about this task because you don't want to be in a situation where you are physically or mentally unable to make a needed account transaction but your agent unable to help you because the financial institution will not accept your GDPOA.