Rules Relaxed But Fears Of Financial Abuse Still Worry Experts

The second lockdown ushers in new waves of concern over financial abuse from experts, despite Lasting Powers of Attorney (LPAs) rules on face-to-face meetings being relaxed.

For Talk Money Week, specialists at leading national law firm are raising awareness of LPAs and how the situation around them has changed since the first lockdown.

In July this year the Office of the Public Guardian (OPG) unveiled a new digital system for the LPA process, which has since come under criticism for only letting financial institutions see a summary of information rather than the person’s specific instructions – potentially exposing the elderly and vulnerable to financial abuse.

In a bid to increase the amount of LPAs being taken out, their website states ‘you don’t need a lawyer to make an LPA, unless you have unusual or specific requirements’ – but experts at leading national law firm Irwin Mitchell say the decision is too important not to make without one.

Expert Opinion

“Making a property and affairs LPA involves an enormously important decision: to give another person control over your wealth, which likely you have spent your lifetime building. They also involve a number of responsibilities, duties and limitations, many attorneys and donors do not know about.

“LPAs should be made, in almost every case, pursuant to legal advice and education. Solicitors are an important safeguard for vulnerable clients because they act as another level of oversight and layer of protection, which is particularly important in light of the second lockdown which could well be extended.” Nicola Bushby - Partner

The second lockdown rules are slightly different; anyone looking to make an LPA with the help of a solicitor is now able to as long as social distancing rules are observed. LPAs need in-person or ‘wet’ signatures, and must be independently witnessed.

However, we are likely to see more certificate providers of LPAs – the people who make sure the person getting an LPA understands the consequences and is free from any undue influence – carrying out their checks over the phone or via a video call, rather than in person, which is open to exploitation.

It’s a worrying situation, made worse by increasing delays from the OPG in processing complaints about financial abuse. In its latest annual report from July 2020, there were 3,099 investigations in 2019/20 compared to 2,883 the previous year.

Nicola continued: “We’ve recently seen a delay by the OPG of nearly two years in processing a complaint about financial abuse. This means it may be necessary for people to take their own action if they suspect a loved one’s finances are the subject of abuse and want to stop further abuse, or they have been wrongly accused and do not want matter hanging over them, nor the administration of their relative’s finances impeded by the delay.

“Once again talking to a solicitor is highly recommended in this situation, who can help you with your application to the Court of Protection. It can be a long and expensive process, not to mention emotionally draining, so having the support of a professional who deals with these kinds of applications all the time is an invaluable resource.”