Issue with Character Arm When Creating a Draggable Handle

I’m working on a character design, and I’ve run into a problem when creating a draggable handle for the arm. As shown in the attached images, when I move the arm into the scene, it doesn’t behave as expected—there seems to be some distortion.

Does anyone know why this might be happening or how to fix it? Could it be an issue with the rigging, weight painting, or the pivot point of the draggable handle? Any help would be greatly appreciated!

Thanks in advance!