Airline asking for power of attourney before paying compensation

My partner and I (both based in the UK) were delayed on a recent flight to Spain with Iberia airline. After a lot of back and forth communication between my partner and Iberia, they have agreed to pay us compensation.

However, they have told us they need the following information from us, in order to pay us:

In order for us to proceed with the payment, please send us the following bank details to e-mail cacgestionjuridica@iberia.es :

• Power of Attorney signed by all the passengers involved.

• A copy of the clients’ passports

• Bank details with the name and full address of the bank (street name and umber, post code and town/city)

• Account holder’s complete name, VAT number and postal address.

• Account number

• IBAN and SWIFT codes

We are unclear as to what "power of attorney" means in this situation. My partner thinks it is badly translated, and simply means that they want me to write and sign a letter saying she can claim the compensation on my behalf, but I'm not so sure. I'm obviously not very happy giving actual legal power of attourney to an airline, nor does this request make any sense to me.

We are also concerned about sending scanned copies of our passports, for the usual reasons.

Are these requests standard practice? Should we be concerned? Should we comply? What exactly do they mean by "power of attourney" and what should we send them?