The death of a relative brings with it a number of legal challenges for heirs. This includes the regulation of banking transactions. Who may immediately make withdrawals from the deceased's account? Which person is obliged to provide information to others in these matters? Who has which authorizations for transactions?

It is not uncommon for authorized representatives to make large withdrawals or transfers from the account before or after the death of the deceased. In some cases, the deceased's account is even emptied completely. Has the account been plundered? What rights do heirs have vis-à-vis co-heirs and authorized representatives?

The most important facts at a glance

  • If an account has been emptied after the death of the account holder with power of attorney, this may be unlawful
  • Heirs should revoke existing powers of attorney as soon as possible after the death
  • In a legal dispute, the authorized representative must prove that he or she handed over the money from the account to the testator
  • In many cases, heirs have the right to recover money already disposed of by authorized representatives

Bank account may continue to be used after the death of the account holder

Legally, a bank account continues to exist and can be used even after the death of the account holder. For example, existing standing orders are still executed. However, the credit balance in the deceased's bank accounts is included in the estate. As an heir, you automatically become the account holder after the death of your relative.

In practice, some banks prevent unauthorized disposals by blocking the account after the account holder's death. However, account blocking is not required by law. Therefore, authorized representatives who have a power of attorney after death can continue to withdraw money from the account or initiate transfers.

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Withdrawing money from a deceased person’s account with / without power of attorney

Two groups of persons are still entitled to dispose of the account after the death of the account holder:

  • Beneficiaries
  • Authorized representative

In any case, the heirs are entitled to dispose of the property after death. They only have to prove their entitlement to inherit to the bank. If there are several heirs, dispositions from the account may only be made jointly by the community of heirs.

If an authorized representative who is not entitled to inherit has emptied the account, this is only permissible if the power of attorney survives the death. However, such a power of attorney does not usually include the right to use the money for your own purposes. Such dispositions are not usually part of the competence of the authorized representative. This is because the power of attorney usually stipulates that disposals are to be made on behalf of the account holder.

Authorized representatives who make or have made disposals from the deceased's account are therefore often liable to pay compensation to the heirs. Sometimes the conduct of the authorized representative can even be prosecuted under criminal law. In particular in the case of embezzlement according to § 266 StGB.

Account plundered before death

Unauthorized withdrawals from the deceased's account may have taken place before the death of the deceased. Quite a few heirs even have to deal with account looting. This means that particularly large amounts were withdrawn illegally or even the entire account was emptied.

In such cases, it does not matter whether the account was plundered with a general power of attorney or a simple bank power of attorney. More importantly, the authorized representative must also prove that the money was used for the account holder's benefit before death. In case of doubt, heirs should dispute this and take legal action.

What should heirs do after the account holder’s death?

From a legal point of view, the heirs of the previous account holder become the new owners of the account balance upon his or her death. To avoid unauthorized dispositions, the heirs should take the following measures vis-à-vis the bank:

  • Informing the bank about the death of the testator
  • Ask the account-holding institution to block the accounts
  • Revoking powers of attorney

The heirs have the right to revoke existing powers of attorney for the accounts at any time, as they legally take the place of the deceased account holder. Based on Section 168 sentence 2 BGB, it is sufficient for an heir to do so. This is also possible without the consent of the co-heirs. After revocation, former authorized representatives may definitely no longer withdraw funds from the account.

As many heirs initially have only limited insight into the account movements , they should request these from the bank immediately. If the heirs discover unauthorized dispositions by an authorized representative, compensation may have to be claimed from the authorized representative.

Heirs have the right to reclaim unauthorized withdrawals from authorized representatives. This applies both to dispositions before and after the death of the testator. Section 667 BGB plays a central role in such legal disputes.

This obliges the authorized representative to either hand over withdrawn funds to the account holder or to use them on the account holder's behalf. The so-called claim to surrender is transferred to the heirs after the death of the account holder.

Enforce your claims for compensation

In practice, account dispositions by authorized representatives often become a problem for heirs. The authorized representative must provide the heirs with information and proof that the money was used for the deceased.

It is not uncommon for authorized representatives to refuse to provide information to the rightful heirs or to be unwilling to provide evidence or make the appropriate use of the money credible to the heirs. This can have serious consequences for authorized representatives. They are often obliged to pay compensation to the heirs.

When taking action against authorized representatives who have made unauthorized dispositions, it is extremely important to clarify the facts as a basis for all further steps. Above all, information must be obtained from the authorized representative. If these are refused, it is advisable to consult a lawyer and , if necessary, to file an action for disclosure.

For affected heirs who suspect unauthorized dispositions from their relative's account, CDR Legal offers an initial meeting by telephone.

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F.A.Q.

What is a health care proxy?

A health care proxy is a document that authorizes a person (the principal) to make decisions in the event of physical or mental impairment. The power of attorney holder is authorized to make decisions regarding finances, medical treatment, housing and other personal matters. A health care proxy is an important document to ensure that the wishes of the principal are taken into account in the event of physical or mental impairment.

How long does it take to close an account after a death?

Closing an account after a death can take several weeks. The exact duration depends on various factors, such as the type of account, the number of heirs and the type of inheritance. As a rule, the heirs are asked to submit a copy of the death register, a copy of the will and a copy of the inventory of the estate.

What can I do with a general power of attorney?

A general power of attorney enables a person to authorize another person to carry out certain actions on behalf of the principal. With a general power of attorney, the principal can, for example, authorize another person to carry out banking transactions on behalf of the principal, buy or sell real estate or settle other legal matters on behalf of the principal.

What happens after the will is opened?

After the will has been opened, the heirs are notified and the distribution of the estate is initiated. The testator may have drawn up a will regulating the distribution of his assets. In this case, the heirs must follow the instructions in the will. If there is no will, the inheritance is distributed in accordance with the statutory provisions of inheritance law. The certificate of inheritance is issued and the heirs receive their share of the inheritance.

How long should documents of deceased persons be kept?

Under German law, private individuals are not subject to any fixed statutory retention obligations for the documents of deceased persons. The German Civil Code (BGB), the German Commercial Code (HGB) and the German Fiscal Code (AO) all have different retention periods. It is therefore always recommended to keep certain documents for certain periods of time in order to be able to assert claims or provide evidence. We recommend the following: 1. wills, deeds of gift and notarized estate documents: lifelong safekeeping to avoid any inheritance disputes in the event of an emergency. 2. registry office certificates (birth, marriage, death certificates): lifelong retention, as they may be required for evidence. 3. tax documents: at least until receipt of the relevant tax assessment notice, preferably three years beyond that. 4. bank documents/account statements, credit documents: at least three years, preferably longer, especially after large payments have been made. 5. court judgments, default summonses: keep for 30 years, see § 197 BGB.

When does the probate court get in touch?

The probate court will normally respond within 8 weeks of the application for probate being filed. In some cases, however, it may take longer for the probate court to get in touch. It is therefore advisable to contact the probate court regularly to find out the status of the application.

What is a power of attorney?

According to the German Civil Code (BGB), a power of attorney is a power of representation granted in a legal transaction. Power of representation in turn enables the authorized representative to carry out a large number of legal transactions in his own name but on behalf of the represented party.

What is an authorized representative not allowed to do?

An authorized representative may not abuse the rights of the authorized representative, i.e. they may not act on their own behalf, but only in the interests of the authorized representative. He may also not attempt to defraud or take advantage of the authorized representative. Furthermore, an authorized representative may not make decisions that may affect the rights or interests of the authorized representative without the latter's consent.

How long is a health care proxy valid for?

A health care proxy is valid as long as the testator is alive and does not revoke it. As long as the testator is alive, he or she can revoke the power of attorney at any time. If the testator dies, the power of attorney loses its validity.

What is a sub-authorization?

A sub-authorization allows the person concerned to conduct business and make binding declarations on behalf of another person. The sub-authorized representative is the representative of the actual principal himself, not of the authorized representative who granted the sub-authorization. The person who has been granted a sub-authorization must act for the principal and not for the person who granted him the sub-authorization.

How long can an estate account be held?

An estate account can be held for as long as is necessary for the settlement of the estate. This usually takes until all of the deceased's assets have been distributed and paid out to the heirs. In some cases, however, it may be necessary to keep the account open for a longer period of time in order to pay inheritance tax or meet other financial obligations. It is therefore important that the heirs and administrators of the estate regularly check whether the account is still open and whether further action is required.

How long do account statements of deceased persons have to be kept?

Account statements of deceased persons must generally be kept for 10 years. This period begins with the death of the deceased and applies to all accounts that existed during the lifetime of the deceased. It is important that account statements are kept carefully, as they are needed for inheritance and tax procedures.

What does a general power of attorney cost?

The costs of a general power of attorney depend on how it is drawn up and the assets of the principal. It is important that you consult an experienced lawyer to ensure that the general power of attorney is issued properly.

Where can I obtain a health care proxy?

A health care proxy can be obtained from a lawyer or notary. A health care proxy is a document that authorizes a person (principal) to make decisions on behalf of the principal in the event of illness or an accident. The grantor of power of attorney can instruct the grantee to make decisions about medical treatment, finances and other personal matters. A lawyer or notary can help you draw up a power of attorney that meets the legal requirements.

What is an authorized representative not allowed to do?

Like any form of power of attorney, an account power of attorney can have a framework. The authorized representative may not act beyond this agreed scope. Furthermore, he may not act in his own name, but makes a declaration on behalf of the client. An authorized representative may not use the identity of the represented party to make unauthorized account transactions and overdraw the account. However, as is so often the case, legal permission is not the same as legal ability. In many cases, the transactions of the authorized representative listed above are effective in the external relationship with third parties. The principal must then take this into account. However, in the internal relationship between the principal and the authorized representative, the latter is then obliged to pay compensation.

What must a power of attorney contain?

A power of attorney must contain a range of information in order to be valid. This includes the name of the principal, the name of the authorized representative, a clear description of the powers of the authorized representative, a date on which the power of attorney becomes effective and a signature of the principal. It is important that all information is correct and complete so that the power of attorney is legally valid.

What does a power of attorney beyond death mean?

A power of attorney after death is a type of power of attorney that is still valid after the death of the principal, known as a post-mortem power of attorney. It enables the authorized representative to make decisions on behalf of the testator that are still effective after the testator's death. This includes the administration of the estate, the preparation of a will or the handling of banking transactions. Such a power of attorney is a very important measure to ensure that the testator still has control over their assets after their death. Finally, it can also be issued in order to represent the respective heirs after the succession.