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My mom has been diagnosed with dementia. Is it legal for her will, power of attorney or bank accounts to be changed with my mom having dementia? Can the Attorney and my Sister face legal issues for doing this?

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Here is an AC article about determining competency for signing legal documents:
https://www.agingcare.com/articles/elder-cant-sign-will-trust-power-of-attorney-153521.htm
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Having dementia is not proof in itself that someone is not competent to make their own decisions. For assigning a POA, for example, the person must understand what the document means and be able to identify the person she wants to have this authority.

If the attorney is not satisfied that Mother understands what she is doing and goes ahead with the documents anyway, then, yes, there can be some legal consequences.

If your sister is somehow coercing Mother and Mother is not acting of her own free will, that would cause legal trouble, too. The lawyer will probably meet with Mother alone.
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