Attorney Financial Abuse – What Are The Options?

A Lasting Power of Attorney (LPA) is an extremely useful document that gives a person’s chosen attorney, may it be a close family member, a friend, or even a law firm, the legal authority to make decisions on their behalf.

The Property and Financial Affairs LPA gives the attorney vast financial powers including making bank transfers, taking out loans, making gifts, buying and selling property all for and in the name of the donor. Unfortunately, that amount of power over someone else’s life savings and assets can be all too tempting for a minority of attorneys.

Financial abuse by attorneys against donors

Back in 2015, KPMG conducted a survey that revealed a shocking number of financial abuse was carried out by family members against the elderly. The most common offenders were aged 50-70, stealing from an older family member, usually taking advantage of donor’s declining mental and physical health, and/or lack of technical and technological knowledge. The results can be financially and emotionally devastating for the donor.

In the event of abuse being suspected, there are ways and means of dealing with it. So what can be done?

1. Revoke the LPA

If the donor still has mental capacity, they can contact the Office of the Public Guardian (OPG) to have the LPA and any associated powers revoked. They can then make a new LPA appointing other suitable attorneys. Alternatively, the OPG can bring proceedings in the Court of Protection against the attorney(s) in question which can result in revocation, and an order to pay back sums.

2. Deputyship

If the donor has already lost mental capacity and their LPA will need to be revoked, consider applying for a deputyship to take over the responsibility of and safeguard the donor’s property and financial affairs. An appointee may be required to handle the donor’s state pension and/or benefits in the meantime.

3. Speak to the authorities

Remember, financial abuse is a criminal offence and must be reported to the police. Contact should also be made with Adult Social Care if the donor is elderly and vulnerable, and also with the OPG for additional guidance on what can be done to protect the donor and to start proceedings if needed.

To safeguard the donor’s assets, notify the donor’s bank and financial institutions to stop further transactions from being made and to investigate previous fraudulent ones.

4. Legal action

In addition to notifying the police of any criminal offences, the donor may have a claim against the offending attorney to recover any losses either directly through the attorney’s theft of the donor’s assets, unlawfully benefiting from the donor, or causing a loss in the mismanagement of funds.

Warning signs to look out for:

• Unusual changes in the donor’s expenditure;
• Unexplained withdrawals and/or transfers;
• Unusual gifts (consider the recipient, the amount and timing);
• Property and bank accounts changing names;
• Sudden appearances of ‘friends’ who may be influencing the donor; and
• The attorney’s reluctance to talk about the donor’s finances other than for confidentiality reasons.

If you suspect someone is being financially abused, consider all of the above options and speak to an appropriate professional.