By Donya Parrish, MCU VP- Risk Management

One of the common questions to the compliance hotline is whether someone with a power of attorney (POA) — known as the agent–  can change the terms of the principal’s account. It makes credit union staff uncomfortable, so I am glad when they call or email for direction.

The request is often to remove a joint owner or to add themself as a payable-on-death (POD) beneficiary. It might stem from a poor relationship with another family member, or a belief that the agent themself should be entitled to the funds after the principal’s death due to their assistance late in their life. Regardless of the reason, it helps to have staffed trained on how to respond to the ask.

Fortunately, our Montana Power of Attorney Act addresses the issue directly in 72-31-336. where it says that authority for certain actions does not fall under the general “financial transactions” or “all of the above” options on the POA form. Instead, they require the principal to “expressly grants the agent the authority” in the POA form. That includes authority to (c) create or change rights of survivorship and to (d) create or change a beneficiary designation, among other actions.

The Power of Attorney MontGuide says that the, “Montana Uniform POA Act lists certain actions the agent can take, but only if the principal specifically states the powers in the POA. The principal should carefully consider whether the additional powers below should be given to an agent as they could significantly affect the principal’s estate plan.” It’s a great resource to share with agents to help them understand their role, including expectations and limitations.