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In an over-litigious society such as ours, what we say isn't as important as what we can prove. If you confront the person first and threaten exposure, you're giving them the opportunity to cover their tracks and come up with the ghost paperwork needed to make you look like a malicious, vindictive tattletaler.

If you "report" the individual, you must have substantial (preferably written) proof. Simply file a complaint with the appropriate agency for fraud. You'll know the perpetrator is being investigated when he/she starts trying to find out who the accuser is. Just don't tell him/her anything until it all comes out in the wash, the rinse, or the lint. Then again, you don't have to say anything unless you really want to rub their face in it. After all, they asked for it, didn't they?
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As the POA for my mother-in-law, I would hope that the family would be the first ones to talk to me about how I spend her money. I may or may not have a good answer for them, but it would be preferable, at least to keep harmony in the family.
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