Access with peace of mind

Being locked out of the bank account of a family member, even when you have permission from the account holder, is a reasonably common complaint to the Banking Ombudsman Scheme.

This is an example of the fine balance between convenience and protection. Banks are obliged to protect customers’ privacy, keep accounts secure, and look out for scams and financial abuse. However, they are also obliged to support older customers and those with disabilities. The cautious approach to providing access to another customer’s account can sometimes cause frustration and stress.

Setting up an enduring power of attorney (EPOA), and providing your bank with the necessary documents well in advance, is a sensible way to ensure your family can support you if you become ill or lose capacity. You can use an EPOA to appoint a trusted friend or relative as your attorney, giving them the authority to manage your property and affairs.

Problems arise when the bank does not have certified copies of the relevant documents. Even if you have a signed EPOA, before you can access another customer’s account you need to prove you are who you say you are, and that you have permission from the customer.

The bank will usually need to see the original, or a certified copy of the EPOA, plus a copy of your attorney’s ID. A certificate of non-revocation, a legal declaration that says there has been no change since the power of attorney was put in place and there is no intention to revoke it, may also be required.

Last financial year we received 32 complaints relating to EPOAs, including 12 where family members were having difficulty accessing the customer’s accounts using an EPOA. Since July last year we’ve received 22 complaints. When bills and expenses are left unpaid, problems can escalate.

For example, Jacquie’s* father appointed her as his attorney under an EPOA, so she could manage his property. In early 2020, he had a serious accident and was unable to manage his finances. Jacquie, who was living in Australia, needed access to her father’s bank accounts to pay urgent expenses.

The bank told Jacquie she’d need to provide ID and a certified copy of the EPOA at a branch. Due to Covid-19 travel restrictions, she had no way of getting home to New Zealand. Jacquie contacted us and we discussed it with bank. The bank contacted Jacquie again, and was able to arrange access to her father’s accounts. A good outcome after a stressful time for Jacquie.

We all want to know our money in the bank is secure. Sadly, we often receive complaints about the devastating impact of scams, and about family members trying to take advantage of elderly or incapacitated relatives. Studies show 1 in 10 older New Zealanders have experienced some form of elder abuse.

As banks are obliged to protect our accounts, they are also obliged to treat all customers fairly and reasonably, which includes providing extra assistance to customers experiencing vulnerabilities, such as Jacquie’s father. We expect banks to take proactive steps to support their customers when they need it.

To prevent future difficulties with access to your accounts, we recommend talking to your bank early, ideally when you set up your EPOA. If you can provide a certified copy of the relevant documents to your bank while you’re healthy and able, you’ll make things smoother for your family if they need to take care of you down the road.

* Not her real name

If our end game is broad, we will all take on roles that may not feel passionately aligned, but that serve some greater goal.

The Banking Ombudsman Scheme offers free and independent help to bank customers.