Be careful who you let near your purse strings

Power of Attorney is too important not to be given serious consideration, says Catriona Torrance

ITV’S 30 November Tonight focussed on problems with family members defrauding elderly relatives and highlighted that many people who have granted a power of attorney in England and Wales are not aware of the lack of safeguards.

It is suggested that there is a lack of transparency and accountability in the system which leads to a risk of abuse and could have devastating effects on the granter and on family relationships. But is this true in Scotland?

As with many things legal, the systems are different in England & Wales and Scotland. Scottish powers of attorney must be signed in the presence of a solicitor or practising medical doctor. This is to certify that you have full capacity, that you understand the nature and terms of what you are signing and that no-one is pressurising you into doing so.

English lasting powers of attorney are pro-forma documents, which in some circumstances are downloaded from the internet and certified by anyone who has known you for two years. There’s no requirement for the certifier to have any particular qualification, experience or, indeed, knowledge of powers of attorney. Scottish documents are much more detailed and tailored to your individual circumstances. If you don’t want your attorney to be able to invest your money in the stockmarket, or sell your house, you simply don’t give your attorney this authority.

It is very important to think carefully about who to appoint as attorney and one easy way to build in an extra safeguard is to appoint more than one person to act. You might also consider appointing a professional adviser to act alongside a family member. Joint attorneys are obliged to consult with one another when making decisions and each of them would be able to access and monitor bank accounts and thus keep a check on the other. If there are any concerns about how an attorney is operating, the Office of the Public Guardian in Scotland has the power to investigate.

There is a similar office for England and Wales, and both offices publish Codes of Practice that attorneys are expect- ed to follow and one requirement is to keep records of their actions. If serious issues with fraud and theft arise then the police can be alerted.

In Scotland, if you become unable to manage your own affairs and make decisions, and you do not have a power of attorney in place, an application can be made to court to appoint a guardian. This is a lengthy procedure, normally taking between 7-12 months, at a time when there is likely to be considerable stress already on family members and others, and the decision as to who to appoint is made by the court.

There have been suggestions that in England and Wales, under the current system, it might be better to have the court appoint the English form of guardian known as a deputy. This comes with additional scrutiny through the court application but also the additional expense of a special insurance policy and annual accounts. The cost could be £320 per year. The equivalent set-up and annual costs in Scotland (appointing a guardian) are often in the thousands, depending on the assets being managed.

We still believe that granting a power of attorney in Scotland is appropriate. There is a robust system for reporting any concerns raised by family members or other interested parties during the life of the granter. And before granting a power of attorney, discussions with your solicitor will help you decide who is best placed to take on the responsibility and what authority they should be given. Scottish solicitors are highly experienced in advising people on powers of attorney, getting to know your individual circumstances and making sure your best interests are safeguarded.

If there are any concerns regarding the appointment, these will be raised and discussed in detail to make sure you are completely satisfied that you are appointing the mostappropriate,trustworthy person to act on your behalf. Catriona Torrance is a Private Client solicitor at Balfour + Manson, Edinburgh.