Is there a law that prevents a caregiver from cleaning out the bank account of an elderly person?

If your Uncle is still of clear mind he can still give his money to whomever he wants. If he has dementia to a point that he can no longer understand the consequences of handing his money out, then there is an issue.

Usually if a caregiver is from a license Agency, he/she is not allowed to take any money. Unless it is an occasion gift card or $$ that is in a low amount and if that is allowed by the Agency.

Maybe it is time for the Uncle's Power of Attorney to see if he/she can start taking over the finances, such as the bill paying, etc. I remember my elderly Dad was more than happy to get that chore off of his plate :)

How many years? $30K a month? $360K a year extra? Really?! Surely the caregiver can afford to retire by now?

FF since NephewPOA posts that he discovered this while auditing his uncle's finances, I think we can assume that the getting things in hand process has already been begun.

His doctor has agreed to declare him mentally incompetent next week when he goes in for an appointment. I spoke to the doctor yesterday. I have explained I am taking over ALL finances as his POA. He still insists on keeping this caregiver.
Mainly I was wondering if it was legal to give a caregiver that kind of money (Probably $4k to $5k per month was for his expenses...the rest just disappeared in checks written to the caregiver and checks for cash). She is not hired through an agency, and his arrangement with her was to pay her in cash. I am sure she is "off the grid" as far as IRS or any other government taxes. Would not surprise me if she is on welfare as well.

His doctor has agreed... When did your uncle's doctor conduct his assessment? Or do you mean that the doctor has agreed to do that next week?

You said above that "for years" this caregiver has been siphoning off $30,000 per month, which we'll adjust to $25,000 per month to allow for the legitimate expenses which you mention in your second post.

As a minimum, at the very least, that means that you are saying this woman has relieved your uncle of more than half a million dollars.

Seriously? Is that what you mean? Is that what you put to her when she told you your uncle had been "helping out"? Over half a million dollars?

Very helpful indeed.

In Massachusetts, I would have recommended that you call elder services. Don't
Be surprised if once you take over your uncle's finances and she is no longer earning 30k a month JFS she is no longer interested in caring for your uncle.

I have a hunch that the caregiver may very attractive.

Grace + Peace,

Bob

Since the POA was clueless what was going on for "years" especially that the uncle is wealthy--it sounds like the POA was also neglectful and you too are after his money. Cheers. Typical vulture family just after the money. With that kind of money he could have had around the clock private nursing care from a reputable agency, or live in a fancy high-class nursing home. 

To find out if it's "legal" for someone like your uncle to have given away all that money, you will probably need to look into your state laws. Many states have statutes protecting "vulnerable" adults.

Usually your options are to contact Adult Protective Services and/or consult with an elder law attorney.

An elder law attorney in your state should be able to help you understand if you can make a case that this was illegal and/or abusive, and whether it's worth trying to recover anything from the caregiver.

But attorneys are expensive, so you may want to do some more research first.

I don't think that's fair, Cetude. The nephew was given power of attorney by his uncle, but that doesn't mean his uncle gave him any opportunity to use it. And as long as the uncle's competent, the nephew couldn't even look at a single bank statement without the uncle's permission. He's finding stuff out now, and he's pretty horrified by it apparently.

I'm just hoping to hear more about whether this kindly gentleman really has handed over that amount of money. I am agog.

You know, the original poster has never come out and said that he is officially the POA...

POA has to be set up *before* cognizant decline. Otherwise it will be court appointed guardian. POA has a responsibility and if they didn't exercise it oh well.

The POA cannot exercise his responsibility without the permission of the person for whom he holds it, unless and until that person is recognised to lack capacity; and if you cannot do something, you cannot be held responsible for not doing it.

I am in the process of giving POA to someone now. I am 53. I do not expect him to need to exercise it for some time, if ever. The whole point is for it to be there in case, because you never know and if you wait until you do know you're likely to be too late.

Tinkster, true. I was taking his screen name of NephewPOA as a clue.

Cetude, what a hateful comment. If you can't say something helpful, don't say anything at all.

We encourage people to sign POAs in advance, while they are able and have the capacity. Nephew was no doubt named some time ago. Uncle has caregiver, things seem to be going well, uncle is paying caregiver. Then, boom, something happens which causes nephew to start looking, and what he finds is horrifying. You can try making a report to the local police and/or elder protective services, but I would not be surprised to find that caregiver has suddenly "left the area."

A gift is a gift is a gift.

Check with your attorney but, a gift is a gift is a gift....

If it's been going on for years why question it now?

RayLin, that depends on how the gift was given. Checks written to cash? That raises a red flag for me. Who signed them? Who cashed them? Where? (One case I know was discovered by the grocery store - caregiver was cashing the checks for groceries, then going to customer service window to buy lottery tickets.) What form of "permission" did he grant? "Go ahead, take something for yourself"? Often an elder's ability to appreciate numbers is one of the first things to go. Does he know the difference between $3000 and $30,000?

If all those payments were really gifts, an independent investigation by elder protective services should be able to clear it up. But on the surface it sounds like a fleecing.

I was assigned POA for my mother several years ago, but until recently never had reason to do anything with it. But things changed recently and now I need to start exercising the POA.

Sounds like he was paying for the "services" of the caregiver. That would mean they are an employee and those payments need to be reported to the IRS. A lawyer may costs $$ but looks like at least a consultation is in order to see what your options are. Most Eldercare lawyers will do a free consult.
It is hard enough to find someone to care for the elderly without someone like that taking $ they obviously weren't earning

That money would have been mine had I owned it. And if I had any caretaker cleaning me out I would fire them right on the spot! You don't use anybody else's money for your personal use without their permission. I wonder where the caretaker was when the brains were being handed out. Out picking daisies?

You should talk to a good estate attorney & CPA firm with forensic accountants. Giving away more than $14,000 per year has estate tax implications. There is probably no way to recover the funds, but the elder's tax returns could be revised for the last 5-7 years to show payments to this caregiver above board, as a contractor. This would then be taxable on the contractor/fleecer's part. You might not be able to get blood from a turnip, but the IRS sure can. Sic 'em!

Another problem is that he should have been paying SS taxes for this woman--of course she doesn't want him to, but he can have to cough up all those taxes for all the years he has been paying her, and probably she will too. When you say off the grid do you imply she may be undocumented? The situation is illegal whatever, but not only for her, for your uncle as well. There is also a limit on how much you can gift to an individual in one year. I think it is around $14,000 a year, and he gives more than that in one month??? You need a tax attorney!

I agree with Country mouse. A POA only comes into effect once the person is incompetent to handle their own affairs. I think you should consult a lawyer but then you won't be able to get the money back. If the doctor declares you Dad incompetent, take all checkbooks, debit and credit cards out of the house. Have a contract between u and her. Depending on what she does, pay her accordingly.

I agree with Country mouse. A POA only comes into effect once the person is incompetent to handle their own affairs. I think you should consult a lawyer but then you won't be able to get the money back. If the doctor declares you Dad incompetent, take all checkbooks, debit and credit cards out of the house. Have a contract between u and her. Depending on what she does, pay her accordingly.

30K a month? wow, I get zero. I'm new on this forum; can anyone tell me what 24/7 in-home carers are paid?

There is no law other than the sheer gall and outright audacity of the caregiver accepting this money. I hope she has sleepless nights.
And OldBob-spot on correct, no doubt!

I suspect that if you get an attorney you can negotiate some sort of 'settlement' with the caregiver that will allow you to recover a material portion of the 'gifts' and keep the caregiver out of jail.

Bummer - late to the party. Anyhoo-

While the post itself seems legitimate enough - older person not thinking clearly being financially taken advantage of... the dollar amounts seem too outrageous to be accurate.

As Countrymouse points out - nearly half a million dollars a year? But $5,000 - $6,000 is okay as it's probably monthly expenses?!! What does this old guy do and/or buy each month cause that's a whole lot of Depends!

One would assume he owns his house so it's not rent... And I have to believe someone with that kind of money to give away has someone - besides the caregiver - in his life, like an accountant, attorney, - even someone at the bank who would have noticed something.

Seriously, old men with mighty big balances in their check books just don't live solitary lives with a lone caregiver being given half a million a year - minus of course the $5,000 - $6,000 a month for Depends and cigarettes. Not to mention a doctor willing to write up a incompetency diagnosis based on a phone call with a POA nephew, without having any tests to back it up. I mean, even if it's obvious the man is incompetent there will need to be test results if it is to stand up in court. Sure, all of this - it's possible but highly unlikely. I'm just sayin'...

I'm not a lawyer or accountant, but I think cash gifts of 14,000 or more get reported to the IRS...