The Dangers of an Online Lasting Power of Attorney

Elderly welfare groups and solicitors have expressed concern at the Financial Conduct Authority’s (FCA) suggestion that Lasting Powers of Attorneys (LPAs) should be granted online.

The body states that the requirement for a ‘wet’ signature (i.e. signing the document with a pen and paper), should be scrapped.

However, members of Solicitors for the Elderly have stated:

“We are extremely concerned by the FCA’s push for fully digital Powers of Attorney. Although we welcome initiatives that make LPAs more accessible, the security of older and vulnerable people is paramount. Under the current system, the FCA’s vision of a secure, end-to-end digital LPA registration process is simply not possible.

“Removing the requirement of a wet signature has the potential to put thousands of people at risk of fraud and financial abuse. An LPA requires the understanding and consent of the donor, but without the witnessing of a physical signature, what is to stop a family member or friend registering a document on someone else’s behalf, perhaps even without their knowledge?

“LPAs are extremely powerful and complex documents, and the prospect of being able to take control of someone else’s bank account and even their property with the few clicks of a button is frankly reckless.”

The purpose of an LPA

An LPA is a legal document that allows a person/s you appoint, known as an Attorney, to make decisions on your behalf, should you lose mental capacity.

There are two types of LPA – a financial & property LPA and a health & welfare LPA.

Under a financial and property LPA, you can assign powers to someone you trust to manage things such as:

  • paying your bills
  • selling or renting out your home
  • collecting and managing benefits and pensions
  • take care of your investment portfolio

A health & welfare LPA provides the ability for your attorney to look after personal care and health choices.  They can decide for example:

  • where you will live and whether you should move into assisted care
  • collecting and administering your medication
  • deciding what you should eat, wear and your recreational activities
  • accept or refuse life-sustaining treatment on your behalf

You can elect to have one or both types of LPA, and the extent of the Attorney’s powers is entirely up to you.  You may also select different attorneys for each type of LPA.

Can LPAs be open to abuse?

Recently, retired Judge Denzil Lush created controversy when he declared he would never have an LPA because it could have a “devastating effect” on family relationships.

In a new foreword to his book, he states the “lack of transparency causes suspicions and concerns which tend to rise in a crescendo and eventually explode”.

He says the Ministry of Justice (MoJ) has been “disingenuous” in promoting LPAs.

The legal document’s popularity has been the result, he says, of a “vigorous campaign” by the MoJ and its agency, the Office of the Public Guardian (OPG), which administers the system.

Although Mr Lush says that he has huge respect in the legal community, his comments drew some raised eyebrows.  Chris Keenan, a director Solicitors for the Elderly, commented:

“Senior Judge Lush’s comments have given rise to fears that LPAs are a direct avenue for financial abuse. However, his comments must be put into context, as his 20-year career at the Court of Protection will have presented him with the very worst cases of financial abuse.

“An LPA can be a positive and effective legal tool, which ensures your wishes are respected should you ever lose capacity. Senior Judge Lush’s comments should highlight the clear need for professional advice when considering powerful legal documents of this nature.”

However, there is no doubt that if an LPA is not created carefully, with the Donor receiving expert legal advice on all aspects of the document, including selecting the appropriate Attorney/s and the extent of the powers they are granted, abuse can occur.

The sad case of Frank Willett illustrates this.

A veteran of Dunkirk and Normandy appointed his neighbour, Colin Blake, his Attorney in 2003 when he was suffering from dementia.

Mr Blake began stealing large sums of money weeks after the Enduring Power of Attorney (a predeceasing document to the LPA) was granted.  By the time the Office of the Public Guardian investigated, and revoked the power of attorney and the Court of Protection appointed Mr Willett’s daughter as deputy, all the money was gone.

It is tales such as this that demonstrate why the security around granting LPAs, if anything, should be increased.  The world is facing a dementia pandemic – by 2050 around 131.5 million people worldwide will suffer from the condition.  To ensure those people can live a life of dignity, LPAs will become an essential part of lifetime planning.  Unfortunately, the more LPAs there are, the more opportunities for elderly exploitation and abuse will exist.

Solicitors who specialise in elderly law are highly-trained and experienced in ensuring those entering into an LPA are doing so of their own free will.

Examples of the safeguards they will adopt when drawing up an LPA include:

  • listening to the donor’s requirements in person, rather than having the LPA being created by computer software
  • advise how to select an Attorneys, including information on the qualities required and an honest evaluation of the capabilities and trustworthiness of the Attorneys selected
  • discuss with Attorneys their duties and responsibilities under the LPA
  • emphasise to Attorneys the importance of acting in the best interests of the donor and provide guidance on ensuring this occurs

None of this would be present under the FCAs proposal to allow people to fill in an online form.

In summary

Protecting the elderly from emotional, physical, and financial abuse is becoming an ever-more important challenge as the population continues to age.  Therefore, it seems almost absurd that the FCA would contemplate the idea of an online-generated LPA, which could easily be hacked by cyber-criminals or created by unscrupulous friends and neighbours.

Investing in experienced legal advice provides the best chance of an LPA working in the spirit in which they were intended – to allow a trusted person to make decisions on behalf of a person who no longer can and provide them with the best quality of life.

And that type of protection and love is priceless.

Hart Reade Solicitors are a full-service law firm with offices in offices in Eastbourne, Hailsham, Polegate and Meads.  We hold a Lexcel accreditation from the Law Society of England and Wales, and are members of Solicitors for the Elderly.  To make an appointment with one of our private client solicitors about creating an LPA, please phone our office on 01323 727 321.