15 Jan What can I do when a bank rejects a power of attorney?

Q. A bank will not accept a power of attorney that was drafted by an attorney. I was appointed power of attorney for my 92-year-old aunt in May. But the bank rejects it. What can I do?
— Perplexed

A. We’re seeing this question more often.

The rejection or refusal to honor properly prepared and executed durable powers of attorney by financial institutions has been a more frequent problem in recent years.

We looked at the law with Catherine Romania, an estate planning attorney with Witman Stadtmauer in Florham Park.

She notes that the New Jersey statute specifically provides: “With respect to banking transactions, banking institutions shall accept and rely on a power of attorney which conforms to this act and shall permit the agent to act and exercise the authority…”

However, she said, the institution can refuse to rely on a power of attorney under certain listed conditions such as where it believes the signature of the principal is not genuine, or the principal is dead, or if it believes the power of attorney has been revoked.

The institution should advise you of the reason for the rejection, she said, but unfortunately, most of the times the rejection is without explanation.

“The New Jersey statute does not specifically provide for any penalties should the bank fail to honor a properly executed durable power of attorney presented under circumstances not suggesting any bad faith or wrong doing on the part of the agent,” Romania said.

For example, the Florida statute indicates that a person rejecting a power of attorney in violation of the statute risks liability for damages including reasonable attorney fees and costs incurred in an action mandating its acceptance, she said.

In order to avoid this issue, it is best to provide a copy of the power of attorney to the financial institution for review by its legal department well in advance of the need for use of the document, Romania suggested.

Of course, that is not always possible.

“Insisting on the reason for the rejection in order that any issue can be addressed, or having your attorney speak with the institution may also, on occasion, resolve the issues,” she said. “Finally, where the principal is still competent to act, you as agent together with the principal can find another financial institution that is willing to accept the power of attorney and have the principal move all of his/her assets to the new institution so that moving forward, the agent can act for the principal.”

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This story was originally published in January 2026. 

NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.