In the UK Financial Ombudsman News Issue 124, Jane Vass Head of Public Policy, Age UK summarises the charity’s view of the issues surrounding successfully putting in place power of attorney arrangements, in dealings with the banks and finance businesses.
The decision to seek a power of attorney reflects or anticipates a difficult situation in the life of the person concerned and their circle of immediate family and friends.
Loss of mental and/or physical capacity is distressing for the affected person and for those close to them. It may also exacerbate other problems such as shortage of money, cost of care and strained relationships.
Frequently, the decision to seek a power of attorney is preceded by a period of informal assistance with banking and paying bills, including the use of the affected person’s bank card and PIN, which breaches their contract with their bank and voids protection from loss!
Calls to Age UK’s information and advice service suggest there can be practical difficulties in using powers of attorney because of the need to formally identify the parties involved, which often means making visits to banks and service providers with photo identification.
The difficulties arise from the inherent complexity of the situation or from shortcomings in organisational procedure and/or staff training. Organisations are generally better at doing things they do all the time, but can stumble when a staff member is carrying out a procedure they haven’t used before or have used only rarely.
Some of the challenges raised with Age UK arise from the fact that the dependent person has already lost significant mental capacity, so it may be too late to set up a power of attorney. Instead, carers may need to go to the Court of Protection – a more costly procedure – for a deputy to be appointed (different rules apply in Scotland).
While banks and service providers will already have procedures in place to support people who are no longer able to manage their own money, Age UK evidence shows that customer experience is very variable.
Ongoing work is needed to ensure that all staff and branches are made aware of the legal rights attached to powers of attorney and have a consistent system for helping customers use them – including procedures that take account of the practical challenges faced by carers and dependents when trying to comply with systems of identification and verification.
Service providers also need to make sure they have a clear system for recording powers of attorney so that customers and their attorneys aren’t inconvenienced in subsequent transactions.
Sources: www.financial-ombudsman.org.uk (Ombudsman News Issue 124 – March/April 2015)