Power of Attorney Abuse in Texas: How It Happens and What You Can Do About It

A power of attorney is one of the most useful tools in estate planning and business. It allows someone you trust — called the agent — to handle financial transactions, manage property, and conduct business on your behalf. But that same power, when misused, can result in devastating financial losses for families.

As a Texas litigation attorney who handles contested estate matters, I see power of attorney abuse regularly. It often involves the unauthorized transfer of real property, draining of financial accounts, or self-dealing by the agent. In many of these cases, the principal — the person who granted the power — either doesn’t know what happened or was unable to stop it.

What Does a Power of Attorney Actually Allow?

A power of attorney is a legal document that grants another person the authority to act on your behalf. The scope can be broad or narrow depending on how the document is drafted. Some powers of attorney are limited to a single transaction. Others are general and give the agent authority over virtually all financial and legal matters.

A durable power of attorney remains effective even if the principal becomes incapacitated, which is one reason it is so commonly used in estate planning. But that durability is also what makes it dangerous in the wrong hands. If the principal can no longer monitor what the agent is doing, the opportunity for abuse increases significantly.

The Fiduciary Duty an Agent Owes Under Texas Law

Texas law imposes a fiduciary duty on anyone who holds a power of attorney. This is the highest duty recognized under the law. It means the agent must act solely in the principal’s best interest — not the agent’s own interest and not in the interest of other family members.

When a fiduciary’s conduct is challenged in court, the burden shifts. The agent must prove that the transactions they carried out were authorized, fair, and in the principal’s interest. This is a high standard, and agents who have used a power of attorney to benefit themselves often cannot meet it.

Common Examples of Power of Attorney Abuse

The most common forms of power of attorney abuse I encounter in my practice involve the transfer of real property — land or a home — from the principal to the agent or to the agent’s family members without the principal’s knowledge or consent. Other frequent scenarios include draining bank or brokerage accounts, changing beneficiary designations on financial accounts, using the principal’s funds for the agent’s personal expenses, and making gifts to the agent or the agent’s children that the principal never authorized.

Sometimes the abuse is intentional. Other times, the agent simply doesn’t understand the legal constraints of their role and treats the principal’s assets as if they were their own. The legal consequences can be the same either way.

A Real Case: Power of Attorney Used to Transfer Family Land

I handled a case in a rural North Texas county that illustrates how power of attorney abuse plays out in real life. A father owned agricultural land that he intended to leave to one of his sons — the son who worked the land and raised cattle on it. The father had granted another son power of attorney to help manage the father’s business affairs.

Instead of using that authority for its intended purpose, the agent son — unhappy that he was not the one receiving the land — used the power of attorney to execute a deed transferring the father’s property to himself and several siblings. The deed was filed in the county records without the father’s knowledge.

When the son who was working the land discovered what happened, he came to me. I filed suit for breach of fiduciary duty. During the litigation, the agent son claimed the transfer was what the father wanted. That’s the most common defense in these cases — “that’s what they told me to do.” But in this case, the father was alive and made clear that he never authorized the transfer. It was his land, and he intended to decide who received it. After contested litigation lasting over two years, the case was resolved through a settlement that put the property back where the father intended.

What to Do If You Suspect Power of Attorney Abuse

If you believe an agent has misused a power of attorney to transfer property, drain accounts, or engage in unauthorized transactions, you should consult with a litigation attorney promptly. These cases are time-sensitive. Once assets have been transferred or spent, recovery becomes more difficult. Key steps include gathering whatever documentation you can — the power of attorney document itself, deeds, account statements, and any communications with the agent — and getting a legal assessment of whether the agent’s actions were authorized and whether they breached their fiduciary duty.

It is also worth noting that these disputes arise on both sides. If you are the agent and someone has accused you of misusing a power of attorney, you need legal representation as well. The burden of proof in fiduciary duty claims falls heavily on the agent, and the stakes are high.

Talk to a Texas Power of Attorney Litigation Attorney

Power of attorney disputes require an attorney who handles contested estate and fiduciary matters — not a general estate planning attorney. These are litigation cases that often involve depositions, document discovery, and trial. If you are dealing with a power of attorney dispute in Texas, call my office at (800) 323-1857 to discuss your situation.

J. Michael Young is a litigation attorney at Wynne, Smith & Young PLLC in Sherman, Texas. He handles contested estate, probate, and life insurance beneficiary disputes across Texas.. (800) 323-1857