Can I challenge transfers made under a power of attorney if I suspect my grandfather lacked capacity?

Short answer: Yes — you can challenge transfers made under a power of attorney (POA) in Arkansas, but success depends on the facts, the timing, and the legal grounds you raise (for example, lack of capacity, undue influence, fraud, or breach of fiduciary duty). Act quickly to preserve evidence and legal options.

Why this matters

When someone signs a power of attorney, they authorize another person (the agent or attorney-in-fact) to act on their financial or property matters. If the principal (here, your grandfather) lacked the mental capacity to understand the POA or was coerced, transfers made by the agent can be attacked in court as void or voidable. Arkansas law recognizes that agents owe duties and that POAs must be made when the principal had sufficient capacity.

How Arkansas law frames capacity and POAs

Arkansas provides statutes and probate procedures that govern powers of attorney, guardianship/conservatorship, and related disputes. In practice, courts look at whether the principal had the mental ability at the time the POA was executed (and at the time of the transfers) to understand the nature and effect of the document and the transactions it authorized. When you raise a challenge, you are asking a court to find the POA invalid or to hold the agent accountable for wrongful transfers.

For background on Arkansas statutes and probate procedures, see the Arkansas Legislature and the Arkansas Courts probate/guardianship resources:

Common legal grounds to challenge transfers

Lack of capacity at execution: If your grandfather could not understand what a POA does or the consequences of authorizing an agent, the POA — and transfers made under it — may be void. Capacity to sign a POA is typically a lower standard than testamentary capacity but still requires understanding the nature and effect of the act.
Undue influence or coercion: If someone pressured, threatened, or manipulated your grandfather to sign the POA or to authorize transfers, a court may set aside the POA or the transfers as having been procured by undue influence.
Fraud or forgery: If an agent forged a signature or misrepresented the document’s contents, those actions can invalidate the transfers and expose the agent to liability.
Breach of fiduciary duty: Agents must act in the principal’s best interests. Self-dealing or transferring assets to themselves or others for improper benefit can lead to civil liability and reversal of transfers.
Failure to follow formal requirements: If the POA lacked required signatures, witnesses, or notarization under Arkansas law, it might be ineffective.

Evidence the court will want to see

To challenge transfers, collect and preserve evidence promptly. Useful evidence includes:

Original POA document and any copies; bank and transfer records showing what changed and when.
Medical records, physician notes, or cognitive assessments near the time the POA was signed and during the transfers.
Witness statements from people who saw the signing or who interacted with your grandfather around that time.
Communications (emails, texts, letters) showing requests, instructions, or potential coercion.
Accountings, cancelled checks, and transaction histories showing who received funds or property.

Practical steps you can take right away

Get a copy of the POA and related bank records. Ask the institution where the transfers occurred to freeze suspicious transactions if possible. Explain you are investigating potential incapacity or wrongdoing.
Preserve medical records. Request copies of recent medical and mental-health records (you may need a court order or the principal’s written consent). Those records are often critical on capacity questions.
Document witnesses and facts. Make a written timeline of events, who was present at the signing, and any changes in behavior or cognition you observed.
Consider an emergency petition. If the principal currently lacks capacity and an agent is misusing funds, an Arkansas court can appoint a guardian or conservator and may issue temporary relief. Contact an attorney quickly — courts move faster when harm is ongoing.
Talk to an attorney who handles elder law, probate, or fiduciary litigation. A lawyer can advise whether to file a civil action to void transfers, seek an accounting, or pursue criminal referral if fraud is suspected.

Where to file a challenge in Arkansas

Procedures vary by county and by the relief sought. Common steps include filing a civil complaint in the circuit court (which handles probate and fiduciary disputes in many counties) to:

ask the court to declare the POA void or voidable;
seek return of improperly transferred funds or property;
request an accounting from the agent;
ask for appointment of a guardian/conservator for the principal if they currently lack capacity.

Arkansas courts have specific forms and procedures for guardianship and probate matters; check local court rules or the Arkansas Judiciary website for county-specific information. If you need help locating the right court forms or clerk, the Arkansas Courts site is a starting point: arcourts.gov.

Timing and deadlines

There are legal time limits and practical reasons to act quickly. Evidence (medical notes, witnesses, electronic records) can disappear or become harder to obtain. Some claims (for example, certain fraud claims) may be subject to statutes of limitation. Speak to an attorney promptly to avoid losing legal rights.

Potential outcomes

The court may declare the POA invalid and reverse or order restitution for improper transfers.
The court may order the agent to provide a formal accounting of transactions and impose sanctions for breaches of duty.
The court may appoint a guardian or conservator to manage the principal’s affairs going forward.
In serious cases, criminal referral may occur if theft, fraud, or forgery is uncovered.

When to involve law enforcement

If you uncover clear theft, forgery, or criminal deception (for example, blank checks signed and filled out later, forged signatures, or transfers to agents for no legitimate reason), consider contacting local law enforcement or the county prosecutor in addition to filing a civil action. Law enforcement can investigate criminal wrongdoing while the civil case seeks recovery.

Helpful hints

Act fast: preserve documents, bank records, and medical records as soon as you suspect wrongdoing.
Get the original POA if possible — copies can obscure alterations or missing formalities.
Note dates and behaviors: a timeline helps show decline in cognition or pressure by others.
Request an accounting in writing from the agent before filing suit — it may produce useful documents and sometimes resolves issues quickly.
Think about temporary court orders: they can freeze assets or stop further transfers while the court reviews the case.
Ask banks about their internal POA and elder-financial-abuse policies — many banks will review suspicious transactions and may place holds while a legal challenge proceeds.
Contact an attorney experienced with Arkansas probate, guardianship, or elder-law litigation. If you need help finding counsel, start with the Arkansas Judiciary site for court resources and consider the Arkansas Bar resources for referrals.