Misuse of Power of Attorney in the UAE: Legal Risks and How to Protect Yourself

A Power of Attorney (POA) is a powerful legal tool in the UAE that allows you to delegate authority to another person (the agent or attorney-in-fact) to act on your behalf. POAs are widely used for business transactions, property sales, court representation, banking matters, and even personal tasks.

However, while POAs are convenient, they also carry significant risks if misused. Unfortunately, cases of misuse of power of attorney in the UAE are not uncommon, and the consequences can be severe for both the principal (the person granting authority) and the agent (the one exercising it).

In this comprehensive guide, we explain:

• What constitutes misuse of a POA. 
• The common forms of abuse in the UAE. 
• The legal consequences under UAE law. 
• Practical steps to revoke, cancel, or challenge a POA. 
• Preventive measures to safeguard yourself from future misuse. 

What is a Power of Attorney (POA)?

A Power of Attorney is a legal document that authorizes someone else (the agent) to act on your behalf in specific or broad matters. In the UAE, a POA must be notarized by a public notary or a licensed private notary to be valid.

Types of POA in the UAE:

• General POA: Grants broad authority, such as handling financial, legal, and business matters. 
• Special POA: Limited to specific tasks, such as selling a property, representing you in court, or managing a single transaction. 

What Constitutes Misuse of a Power of Attorney?

Misuse occurs when the agent acts beyond the scope of authority, for personal gain, or against the interests of the principal. Under UAE law, this can amount to fraud, breach of trust, or forgery—all punishable offenses.

Common Forms of POA Misuse in the UAE

Misuse can happen in many ways. Below are the most frequent scenarios reported in the UAE:

1. Financial Exploitation

• Unauthorized withdrawal or transfer of money. 
• Selling property without the principal’s consent. 
• Using funds for personal investments. 
• Leaking sensitive financial details. 

2. Identity Theft

• Opening bank accounts in the principal’s name. 
• Taking out loans, insurance policies, or credit cards. 
• Misrepresenting the principal in financial transactions. 

3. Medical Exploitation

• Misusing medical insurance for personal claims. 
• Fabricating healthcare costs. 
• Using the principal’s identity to access medical benefits. 

4. Unauthorized Decision-Making

• Making major business or personal decisions without informing the principal. 
• Withholding documents or pressuring the principal into unwanted agreements. 

5. Using POA After Death

• Continuing to act with a POA after the principal’s death is illegal and considered forgery under UAE law. 

6. Neglecting the Principal’s Interests

• Failing to act in the best interest of the principal. 
• Forcing reconciliation, settlements, or negotiations that harm the principal’s rights. 

Legal Consequences of POA Misuse in the UAE

Misusing a power of attorney has serious legal implications:

• Criminal Penalties: The agent may face imprisonment or fines, depending on the severity of the misuse. 
• Invalidity of Transactions: Courts can nullify contracts or sales made under a fraudulent POA. 
• Civil Liability: The agent may be ordered to compensate the principal for damages. 
• Fraud & Forgery Charges: Using expired, revoked, or invalid POAs can result in criminal charges. 
• Article 453 of the UAE Penal Code: Misuse of a POA is treated as a breach of trust and may lead to jail, fines, or both. 

What To Do if Your POA Has Been Misused

If you suspect or discover POA abuse, you must act quickly:

1. Revoke the POA Immediately

File a revocation request with the UAE Notary Public or Court. If the agent refuses, pursue a legal case to prove lack of benefit or expired authority.

2. Notify Third Parties

Inform banks, government entities, or companies that the POA has been revoked to prevent further misuse.

3. Invalidate Harmful Transactions

Request the court to cancel any contracts, sales, or financial moves executed fraudulently.

4. File a Legal Claim Against the Agent

Demand accountability by asking for financial reports and evidence of their actions. Courts can impose civil and criminal penalties.

5. Collect Evidence

Keep copies of the original POA, bank statements, receipts, contracts, or any suspicious documents.

6. Consult a Specialized Lawyer

A lawyer experienced in POA misuse cases in the UAE can guide you through revocation, lawsuits, and recovery of damages.

How to Prevent POA Misuse in the Future

Prevention is always better than cure. Here are essential steps to safeguard your POA:

• Draft your POA with the help of a legal expert. 
• Limit the scope of authority clearly (e.g., one property, one bank account). 
• Specify expiry dates or conditions for the POA. 
• Require regular reporting from the agent. 
• Notify close family members about the POA. 
• Always notarize POAs through a licensed notary to ensure legal validity. 

FAQs

1. What are the powers of a special POA in the UAE?
   It depends on what is written in the document. It may cover property sales, court representation, or a specific transaction.
2. How can I avoid POA misuse?
   Hire a lawyer to draft it, define clear limits, notarize it officially, and keep monitoring.
3. What happens if an agent misuses my POA?
   You can revoke it, file a legal claim, and demand compensation. The agent may also face criminal charges.
4. Can a POA be used after the principal’s death?
   No. Any action after death is invalid and may be treated as forgery.
5. What is the penalty for POA misuse in the UAE?
   Under UAE law, penalties include fines, imprisonment, or both, depending on the severity.

While a power of attorney is an essential tool for managing your affairs in the UAE, it carries serious risks if misused. Whether you are delegating authority for business, property, or personal matters, it is crucial to set clear limits, work with trusted professionals, and act immediately if you suspect abuse.

At our Private Notary Services in Dubai, we provide:

• Drafting and notarizing secure POAs. 
• Revocation and cancellation of fraudulent POAs. 
• Legal consultation and representation for POA misuse cases. 

📌 Don’t let your POA be misused. Contact us today for expert legal protection.