Banking Regulations for Power of Attorney & Joint Accounts

Whenever you have a joint bank account, and a power of attorney, it gives account holders certain rights when it comes to the account. Banking regulations are in place that allows the holder of a power of attorney and joint owners, the ability to perform certain transactions concerning a bank account. Anyone that has a power of attorney should know exactly what the document states including what authority they are turning over to their agent.


Joint Owners

If you have a bank account with joint owners, that means that either owner can access the account and perform transactions without the other owner being present. For instance, one owner can remove all funds, close the account and open a new account with only himself as owner if he chooses to do so. Each owner is equally liable for the account. If there are nonsufficient funds fees charged to the account, then both owners are responsible for the fees. If one of the owners dies, the other owner will have sole ownership of the account. The deceased owner can be removed from the account by bringing in a certified death certificate to a branch representative.


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Power of Attorney

If you have drawn up an instrument called a power of attorney, you are authorizing someone, including an organization, to take care of your personal affairs if it is not convenient for you to do so or if you are incapacitated. The person or organization you give this authority to is called an attorney-in-fact or an agent. If you have a general power of attorney, then your agent can handle a wide variety of activities which include banking transactions such as withdrawals, deposits, cashing checks, access to a safety deposit box and access to monthly bank statements. You might have such an agent if you are traveling out of the country or the state or if you don't have the ability physically or mentally to be responsible for your own financial matters.



If one of the owners of a joint bank account has given power of attorney to an agent, the agent can access the account just as if she were one of the owners of that account. The other joint owner will have to deal with the agent concerning all banking matters.



A power of attorney instrument is legitimate only if the person who signs the document is mentally competent. There is a chance that someone may want to challenge your mental capacity, especially if you are elderly. You may want to have a medical exam done by a physician and get his signature stating you are of sound mind and body when you are ready to sign the power of attorney.



A power of attorney document can also be revoked by the signer for any reason. Once the document is revoked, the agent no longer has the authority to perform any transactions on behalf of the principle or the owner of the account. If you decide to revoke a power of attorney, always put this in writing to make sure you are covering yourself if the need arises later on. You do not have to give any reason for the revocation of power of attorney.