When my mother started going downhill, my sister took her into her home in Texas. My mother never put together a POA or a will. She is now receiving in home hospice care. I video called her and she is not even able to feed herself or walk. However, my sister said she is getting a POA taken care of right now and is going to the bank tomorrow. She claims the case worker is helping her and that Mom had no problem signing another document. I'm not sure what she is up to and I feel terrible thinking she's up to no good. I thought once a parent had full blown dementia that a guardianship is the only way to obtain a POA. She asked me for my address and phone for the POA, and I'm not sure why....
Guardianship and POAs are two different things.
POA is assigned by a principle giving the person assigned certain responsibilities usually when the principle can no longer make informed decisions. The POA may say that one or two doctors have to sign off that the person is incompetent. (There are immediate POAs but I don't think they are widely used)
Guardianship comes about when there is no POA and the person is already incompetent so can't assign a POA. Guardianship is expensive and overrides a POA, judge needs to sign off, and you report to the State. So you don't obtain POA thru Guardianship, Guardianship takes the place of a POA. POAs can be revoked by the principle if competent or the one assigned can step down. Not so with guardianship, a judge has to authorize any changes.
I agree with everything that funkygrandma59 stated, the only difference being the part about the lawyer keeping the document... where I live each PoA gets their own originally signed and notarized copy since places like the bank and facilities will ask the PoA to present it in person, and not a photocopy. But this can differ from state to state.
Does your mother have a documented diagnosis of dementia in her medical records? It's not just an opinion... Just because your mom is weak doesn't mean she is mentally incompetent. It may be that with no PoA in place and in order to make her care management easier the social worker is helping her get it in place now (better late than never, better than having to pursue guardianship). It may not be nefarious. You can certainly query your sister on this.
Your mom needs to be competent in order to assign a power of attorney. It isn't required to be done in an attorney's office or by an attorney, but it does have to be witnessed and notarized. The notary's job is not to determine whether your mother is competent but rather that she is indeed who she says she is. Her ability to sign her name is also not a sign of competency.
As someone else said, a bank isn't likely going to accept that POA. They want their own paperwork filled out, and I don't think it'd be a bad idea to notify them if your mom has indeed been diagnosed with dementia. However, if you don't think your sister is up to no good, it'd make like a lot easier to have POA than not to have it. She got to the point of hospice care without one, which is interesting.
I think you should have a frank talk with your sister and insist on being included in the loop on all this.