Documenting Power of Attorney

by Mary Beth Guard

Question: I read an article you wrote about powers of attorney and I had a question. Should the POA held by the Bank be the original, a copy or a certified copy?

Answer: While the bank may want to request to see the original (to assess for itself whether it appears to have been altered or modified in any way and to assure itself that the copy is a true and correct copy of the original), the original should remain with the principal and/or the attorney-in-fact, rather than with the bank.

In most instances, the power of attorney will need to relied upon by numerous third parties -- not just the bank. Unless the principal has executed multiple duplicate originals, the principal will need to retain the original (or the attorney-in-fact will) and they will only be able to provide a copy.

So long as the bank takes steps to ensure the copy is legitimate, the copy is sufficient.

As BOL Guru Ken Golliher notes, some state statutes expressly state that a copy has the same force and effect as the original. Indiana law, for example, at IC 30-5-8-5, provides that a copy of a power of attorney which is certified as a true and correct copy has the same force and effect as the original, and it provides at IC 30-5-9-99(a) that a person refusing to accept the authority of an attorney-in-fact is liable to the principal and the principal?s heirs.

Make sure you know what your state law has to say on the subject. In the Indiana example given above, for example, Ken pointed outo that a third-party (such as a bank) relying upon a copy of a POA could request an affidavit from the attorney-in-fact to certify the copy's status as a "true and correct" copy.

Originally appeared in the Oklahoma Bankers Association Compliance Informer.

First published on BankersOnline.com 1/28/02