Detailed Answer

Short answer: Yes — you can challenge transfers made under a power of attorney (POA) in Indiana if you reasonably suspect the principal (your grandfather) lacked the mental capacity when the POA was signed or when the transfers occurred, or if the agent exceeded their lawful authority or engaged in fraud or undue influence. What follows explains how these challenges typically work in Indiana, the kinds of proof courts look for, common legal remedies, and practical next steps.

Which Indiana law applies?

The rules governing powers of attorney in Indiana are found in the Indiana Power of Attorney Act (Title 30, Article 5 of the Indiana Code). That Act defines how POAs are created, what powers an agent has, and the agent’s duties. See the Act: Indiana Code, Title 30 — Power of Attorney (IC 30-5). Civil procedures and time limits that may affect your claim are governed by Indiana’s civil code: Indiana Code, Title 34 — Civil Law and Procedure.

Legal bases for challenging transfers

You may have one or more of these grounds to challenge transfers:

Lack of capacity when the POA was signed or when transfers occurred: For a POA to be valid, the principal must have had sufficient mental capacity at the time of signing (usually able to understand the nature and consequences of the document). If transfers occurred while the principal lacked capacity, you can challenge those transactions.
Improper execution of the POA: If the POA wasn’t executed in accordance with Indiana law (for example, missing required signature, witness, or notarial acknowledgment when required), it may be invalid or limited in effect.
Agent exceeded authority: The agent must act only within the authority granted by the POA. Transfers beyond that authority can be reversed or the agent held liable.
Undue influence or fraud: If someone coerced, deceived, or manipulated the principal into signing the POA or into making transfers, courts can set aside transactions and restore assets.
Revocation or termination: If the principal revoked the POA before the transfers (or the POA was otherwise terminated by law, such as by the principal’s death), transfers after revocation/termination are invalid.

What remedies are available in Indiana?

If a court finds a problem, typical remedies include:

Setting aside or rescinding improper transfers and ordering return of funds.
Monetary damages against the agent for breach of fiduciary duty, conversion, or fraud.
Removal of the agent and appointment of a conservator or guardian if the principal lacks capacity and needs court-supervised protection.
Temporary injunctive relief or asset freezes to prevent further dissipation while the case proceeds.
Referral to criminal authorities if theft, elder abuse, or fraud is suspected.

What will a court want to see—types of evidence

To challenge transfers, you will typically need evidence such as:

Medical records and physician or neuropsychological evaluations showing cognitive impairment at the time of signing or transfer.
Testimony from witnesses who saw the principal’s state (confused, disoriented) or who observed the signing circumstances.
Original POA documents, notarizations, and witness statements about execution.
Bank records and transaction histories showing transfers, withdrawals, and the recipient accounts.
Communications (emails, texts, letters) that show fraudulent intent or coercion by the agent.
Expert testimony (medical experts, forensic accountants, handwriting experts) when necessary.

How the process usually works

1) Collect evidence and act quickly. Banks and agents can move or spend assets. Preserve records, request bank statements, and document your concerns in writing.

2) Ask the bank for information. Banks will release certain records in response to demand letters or court subpoenas. Many institutions respond to a formal written request from an attorney.

3) Consider a temporary court filing. You (or an attorney) can file a petition in probate or civil court asking the court to: (a) declare the POA invalid, (b) freeze or recover transferred assets, or (c) appoint a conservator/guardian for the principal if they lack capacity. Courts can grant emergency relief where there is imminent risk to assets.

4) Litigate or negotiate remedies. Cases often resolve by settlement, return of funds, or an order holding the agent liable. If facts are disputed, a trial may be necessary.

Hypothetical example (how it might play out)

Suppose your grandfather executed a POA and, within two weeks, the agent transferred $150,000 from his bank to a personal account and paid themselves $50,000 for “services.” Family members later discover medical records showing the grandfather had advanced dementia and could no longer understand financial transactions at the time. The family can (1) ask the bank to freeze remaining funds, (2) demand records and a copy of the POA, (3) file a petition in probate court to declare the POA invalid based on incapacity and to recover funds, and (4) seek appointment of a conservator to protect the grandfather’s remaining assets. The court will weigh medical evidence, witness testimony, and transaction records and may order the agent to return funds and be removed.

Timing and statute-of-limitations concerns

Time limits apply to civil claims. The specific limitation depends on the cause of action you pursue (e.g., fraud, conversion, breach of fiduciary duty). You should move promptly because delays can make recovery harder and may permit banks or third parties to claim good-faith defenses. See Indiana’s Civil Procedure statutes for limitation rules: Indiana Code, Title 34 — Civil Law and Procedure.

When to involve adult protective services or law enforcement

If you suspect criminal conduct (theft, elder abuse, financial exploitation), report the matter to local law enforcement and to Indiana’s Adult Protective Services or other state agencies that handle elder abuse reports. Criminal investigations can run parallel to civil efforts and sometimes expedite recovery or protection.

Do I need an attorney?

Challenging POA transfers can be fact-intensive and legally technical. An attorney experienced in Indiana probate, elder law, or civil litigation can:

Evaluate evidence and recommend legal theories (lack of capacity, undue influence, breach of fiduciary duty, conversion, etc.).
Prepare preservation letters and emergency petitions to freeze assets.
Coordinate medical records, expert evaluations, and forensic accounting.
Represent you in court and negotiate settlements if appropriate.

Important practical next steps

Preserve evidence: request bank statements, copies of the POA, and any communications about the transfers.
Obtain medical records and a chronology of the principal’s cognitive state around the dates of signing and transfers.
Talk to close family members or witnesses to document what they observed about the principal’s mental state and who had access to them.
Contact an attorney promptly to discuss emergency filings (asset freezes, temporary restraining orders) if assets are at immediate risk.
Report suspected financial exploitation to local law enforcement and relevant state agencies if criminal conduct is suspected.

Key statutory references and resources (Indiana):

Indiana Power of Attorney Act (IC 30-5): https://iga.in.gov/legislative/laws/2024/ic/titles/030#30-5
Indiana Civil Law and Procedure (limitations and remedies): https://iga.in.gov/legislative/laws/2024/ic/titles/034
Indiana Courts — basic guardianship and conservatorship information: https://www.in.gov/judiciary/self-help/guardianship/

Helpful Hints

Act quickly: banks may not be able to reverse transactions after weeks or months without a court order.
Preserve originals: keep original POA documents, case notes, and copies of all financial records you collect.
Document observations: write down dates, times, and specific behaviors that made you worry about capacity.
Get records early: request medical records and physician notes as soon as possible; these records can be crucial evidence of incapacity.
Ask for a forensic accounting if transfers are complex or many transactions occurred.
Be cautious with bank conversations: do not admit facts that could be interpreted as consent to transfers; instead ask how they preserve records and what they need to freeze funds.
Consider mediation for faster, less expensive resolution if the agent is willing to cooperate and return funds.

Disclaimer: This article provides general information about Indiana law and common practices when challenging transfers made under a power of attorney. It is educational only and is not legal advice. You should contact a licensed Indiana attorney about the specific facts of your case before taking action.