How LPAs leave vulnerable people open to scams And why we need to take action! 1
About Switchfoot… 2
About us Rebecca Trudgett FCA • Chartered Accountant • Fellow of the ICAEW • 15 years experience • Founder of SwitchFoot Accounting • Leader in Cloud Accounting • Specialist Xero only practice • App Advisory • Modern bookkeeping 3
About us Sebastian Elwell FPFS TEP • Chartered Financial Planner • Independent • Fellow of the PFS • Full Member of STEP • Member of SOLLA • PFS Retirement & Later Life Specialist of the Year Finalist 2020/21 4
Scams, Frauds, Financial Abuse Remote - impersonal Remote – Personal Personal Cloning Cards Phone Scams Theft • • • ID Theft HMRC Scams Financial abuse within the • • • Direct Debit Fraud ‘Fake Bank’ family • • Insurance Providers? Pension Scams Coercive control • • • Unnecessary services Pension Scams • • ‘Chugging’ • “ ‘Suckers lists’ • Pensions freedoms are set to turbo-charge financial abuse 5
FCA occasional paper No. 8: Consumer Vulnerability What is vulnerability? “A vulnerable consumer is someone who, due to their personal circumstances, is especially susceptible to detriment, particularly when a firm is not acting with appropriate levels of care.” 6
FCA occasional paper No. 31: Aging population and financial services Demographics “It’s well established that the UK population is on average getting older. It is plausible that one in three babies born today can expect to celebrate their 100th birthday. While one in six of the UK population is currently aged 65 and over, by 2050 one in four will be. This changing demographic will have ramifications for public policy.” 7
LPA Vs Deputyship Order LPAs CoP Deputyship Order Administratively complex • Administratively simple Higher cost • • Relatively low cost Delays in the system – High demand • • Largely unsupervised Ongoing supervision from the OPG • • Oversight by OPG (if concerns raised) Annual Deputy Return • • Attorneys chosen by donor Deputy Bond • • Flexible document (clauses can be added) • 8
Headlines The Law Gazette 2017 I would never sign a power of attorney - retired judge 9
AGE 83 2015 – 2020 – 2024 - 2032 10 10 10
Accessible Wealth Risk Unsupervised Vulnerability 11
Psychology of Abuse – SFE Conference 2019 Kathleen O’Hara MA LPC Caroline Bielanska TEP ‘ Family dynamics and elder victims of fraud & abuse ’ OPG and Nudge Theory Victims – “most people are compliant when they are told the rules; some need to understand the reasons behind ‘Independent with no designated financial the rules, before they are compliant; and a small caretakers’ number will ignore the rules, regardless of the consequences. If Nudge theory were applied to ‘Social Isolation’ lasting powers, nearly all attorneys would make legally Signs – compliant decisions” ‘Elder isolation’ ‘Not allowed to speak for her/himself’ ‘Controlling behaviour’ ‘Unaccounted for transactions’ Upstandership – ‘attention, awareness, knowledge, response ability’ 12
“If Nudge theory were applied to lasting powers, nearly all attorneys would make legally compliant decisions” Caroline Bielanska June 2019 SFE Conference 2019 13 13 13
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