Dementia and Power of Attorney

I was talking to a friend last night who's also dealing with a relative with dementia, and he said that he can't get legal/financial Power of Attorney for her because she's already been medically diagnosed with dementia.

I was wondering if that is strictly true. I had my mother's POA redone at a prestigious law firm to give me POA when she was already clearly in mental difficulty. She already had a POA document, but it named my older brother, who had died.

This guy is dealing with his aunt, diagnosed with dementia. who is buying things she doesn't need when she doesn't have the money to pay for them. He has been with her to her bank to get authority to control her accounts, which they gave him, but when I asked him if he'd gotten full POA, that's when he said it couldn't be done.

I read elsewhere that if the person in question can still comprehend what he or she is doing, then a person diagnosed with dementia can still confer Power of Attorney.

Has anyone dealt with this situation?