My aunt has grossly abused her status as power of attorney over my grandma. What can we do?

There are tons of things you can do. Did the attorney mean that there is nothing you can do to get the money back?
Where is your aunt now? Is she still P O A?
1) The bank wants to know that there was fraud on the bank account. They will investigate it themselves.
2) The credit card companies want to know that another person is opening accounts fraudulently, using the money for self. Report ID theft. The banks are insured for this, your Grandma may not have to pay it back, your aunt could be arrested. A POA is not a permission slip to commit fraud.

Did the attorney mean that her daughter (your aunt) is the closer relative and you cannot legally remove or replace her as POA.???

How far are you or other family members willing to go to protect grandma?

Have you been to the County tax assessor's office or the County Recorder's office to see if Grandma still owns her home???

What do you mean, there is nothing you can do????

Bumping up

If they are misusing POA then you can take legal actions. Talk with the police, or who helped your Aunt become POA in the first place.

Taking out a loan in your principal's name... new one on me. Sounds like fraud, in fact: look at it from the loan company's point of view, would you give a loan to someone who couldn't represent herself?

Go to the police.

Here is an excerpt from an article I just read: "Family members who suspect a relative is misusing a power of attorney can go to court -- the rules are different in every state -- to lodge a challenge. The court will require the power of attorney to show how he or she has been using the money. The person with the power of attorney, the elderly person, and the person challenging the issue will all need their own lawyers. The judge may appoint a guardian to oversee the money." Quite frankly, I am not sure why authorities are not taking these types of claims more seriously. From what I have read about Adult Protective Services, etc., this is considered elder abuse and is not to be tolerated. Find another lawyer and call APS.

You can't file a police report?