People who are thinking of setting up a Lasting Power of Attorney (LPA) are being urged to tread carefully, after a Freedom of Information request revealed that an increasing number of Britons are appointing attorneys who are inexperienced or ill-equipped for the job.
According to data cited in City A.M. this week, the number of investigations into the dubious actions of appointed deputies or attorneys has risen sharply in the past year.
In fact, the number of investigations launched in 2017/18 was a shocking 45 per cent higher than in 2016/17, with 1,647 investigations opened into attorneys and 82 enquiries launched to examine deputies.
Commentators have noted that the increase in investigations can be linked back to the fact that LPAs are growing increasingly popular across the UK.
An LPA, which can enable a trusted friend, family member or loved one to look after the financial affairs of someone who has lost mental capacity, can prove to be vital in instances where a person has developed dementia, or any other serious mental health condition.
However, if families do not take great care when setting up an LPA, the consequences can potentially be devastating, whether this is due to an ill-appointed attorney abusing their power, or a simple mistake made by someone who was ill-equipped to act in accordance with the law.
In one anonymous case documented by City A.M., a son in law who was appointed to act as an attorney for an elderly woman gifted a sum of £324,000 to his wife (the woman’s daughter).
The man claimed that he had made this move due to Inheritance Tax (IHT), but a Judge later found that the £324,000 was too large a gift, due to the fact the elderly woman’s estate totalled more than £1 million. In this instance, the wife who had received the gift was ordered to ‘restore’ a large chunk of the money.
The rules governing LPAs, Wills and IHT are complex and confusing, which is why families should always seek the advice of a specialist solicitor from the very outset.