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Jewish World Review March 14, 2005 / 3 Adar II, 5765

Jan L. Warner & Jan Collins

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Consumer Reports

Can I recoup Dad's stolen SSI cash? | Q: Because my father lives on the other side of the country, he gave me his power of attorney to handle his finances and health care. I am an only child, and my mother died two years ago. At 86, Dad is in good physical health, but he has memory loss and can't handle his own finances. He doesn't drive, and he depends on others to help him get around. His income is from Social Security and a small pension.

Because it was so difficult to obtain his bills and get them paid due to the distance, six months ago, I engaged a firm that advertised expertise in handling money and paying bills for seniors. As a condition of hiring, my father and I made the head of the group Dad's representative payee for his Social Security.

I travel quite a bit with my job, and when I finally got around to reviewing Dad's bank records, I found his account to be overdrawn, some of his recurring bills in collection for nonpayment, and a number of ATM withdrawals. Dad never had an ATM card and wouldn't know how to use one. When the "business" did not return my calls, I traveled cross-country to close out the bank account. Is there anything I can do about the money that has been stolen from my father? I have learned that more than 20 other people have had the same problem with this group.

A: Social Security does not accept powers of attorney, but uses the "representative payee" system. The Social Security Protection Act of 2004 was signed into law to protect against these types of abuses by representative payees that are becoming more frequent. In all, close to 8 million Social Security and SSI recipients have "representative payees" — that is, folks appointed by the Social Security Administration to receive and manage benefits for beneficiaries. While the majority of these fiduciaries are family members, a growing number have been non-family members or organizational entities like the one you hired, certified community-based nonprofit agencies, and others.

Under the 2004 law, the Social Security Administration can, among other things, 1) Replace misused benefits under certain circumstances; 2) Require private representative payees to be both bonded and licensed; 3) Monitor certain representative payees; 4) Disqualify those convicted of felonies, etc., as representative payees; and 5) Recover misused money as overpayments to the representative payee by taking income tax refunds and engaging in the collection process.

While family members and organizations who've misused Social Security benefits when serving as representative payees have been prosecuted and convicted, we think a little planning on your part could have avoided a long legal process. Without being critical of your efforts, which we know were intended with your father's best interests, we believe the situation could have been handled better.

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First, we see no reason why you would want anyone but yourself serving as your father's "representative payee." If the Social Security benefits were directly deposited into your father's account, why appoint anyone else? Here, we think you were looking for trouble. Second, your father's telephone bill and other utilities could have been paid electronically.

Third, you could have engaged paid nonmedical caregivers. For example, Home Instead Senior Care ( is a nationwide service that can be accessed to do your father's shopping and take him where he needs and wants to go. Fourth, you should have reviewed and audited his account every month — not every six months; and, if you did not have the time, you could have hired an accountant local to your father to do so. With bank accounts available online, you could and should have kept up with the spending weekly.

That said, you should contact the Social Security Administration and ask for their help in trying to recover your father's money. You should also contact the local Better Business Bureau and police in your father's locale. Financial abuse of seniors must come to an end.

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JAN L. WARNER received his A.B. and J.D. degrees from the University of South Carolina and earned a Master of Legal Letters (L.L.M.) in Taxation from the Emory University School of Law in Atlanta, Georgia. He is a frequent lecturer at legal education and public information programs throughout the United States. His articles have been published in national and state legal publications. Jan Collins began co-authoring Flying SoloŽ in 1989. She has more than 27 years of experience as a journalist, writer, and editor. To comment or ask a question, please click here.


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Mom may have written me out of her will
Ensuring gifts to grandkids are used for college
Readers rail against politicians; homes showing less restraint
Can I be paid from my uncle's cash?
How can we afford my husband's rehab?
Rule your money from the grave
Planning from a distance
Our fight to improve Mom's care
The long path to deducting at-home care
Getting respite for adult caregivers
Do we tell the kids they're not in our plan?
HIPAA hurts careless life planners
Son's sins infect Mom's care
The sudden pitfalls of an immediate annuity
Furious at home's poor care of Mom
How the government bilks seniors
Solid answers about osteoporosis
The taxing affair of gift giving
Searching for a facility that offers independence
Does anesthesia enfeeble the elderly?
Warning about 'Do Not Resuscitate' (DNR)
Why is Mom such a hoarder?; Medicaid law may leave child homeless
Brother's reaction to Mom's death angers siblings
Unwisely reducing drug dosages
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My parents need a caring lawyer
Can banks reject powers of attorney?
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Sister's early death sparks family estate war
Poor financial planning leaves Dad cash-strapped
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Pay employer taxes for caregivers?
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Parents' trustee choice a hidden blessing
Finding the money for home care
Elderly mom is sweet on a hunky aide
'Ziva' gets the scoop on nation's nursing homes
Care decisions for 'elder orphans'
Seeking help for dementia victims
Read admission-package 'agreements'; booting a patient once Medicaid kicks in
Can the kids block our cash flow?; childless couple agonizes over whether to use
powers of attorney or a living trust to manage our assets

Control your assets from the grave
Slacker son will blow his fortune; lawyer's role in "estate-planning"
Mom remarried and spent my inheritance; doesn't want daughter-in-law to receive anything from estate
Can we stop our brother from swindling us?
What Gifting Will Disqualify You From Medicaid
The 'magic' language for a power of attorney agreement
Is care insurance a healthy choice?
Is there protection against Medicaid costs?
Long-term care insurance comes up short
HIPAA -- too much privacy?; nursing home doc could care less
Private pay nursing home residents pay more
Separated families should use care managers
What Makes Up a Caregiving Team?
Who is the client, parents or children?:

© 2004, Jan Warner