Advisers Highlight Room For Abuse In Power Of Attorney Process
Financial advisers discuss protecting clients who are the subject of a power of attorney registrations.
An ageing population is leading to a rise in the number of people taking over the financial responsibilities of others. Financial planner at Chapters Financial, Keith Churchouse warns that the children of those needing power of attorney orders are “not always the best option”. Often they “are not experienced in larger sums of money” meaning problems can arise.
Director of Dalbeath Financial Planning, Matthew Harris says that on rare occasions “the person who has been granted a guardianship can ask us to release money from an investment for a reason that we are not entirely comfortable with.” However he reports that “ a situation where a guardian or attorney has asked for a very large policy to be cashed in” has never happened to his company and that if it did, “we would certainly refuse to action it.”
Phil Young, managing director of compliance firm ThreeSixty Services explains that on such an occasion, the adviser must not “ just walk away from” the situation but “report it to the Court of Protection.”
In a report published last year the Financial Conduct Authority described firms approach to the matter as “patchy”. Their handbook specifies that “due regard” must be taken in ensuring customers interests are looked after.
Director of wealth management at Sedulo Wealth Management, Paul Lindfield details an instance when he did need to contact the relevant authorities when it was requested that investments meant for long-term care fees were converted into cash. He says “some advisers would have caved into this pressure, but we will always do what is right for our clients and maintain our ethics” ultimately it is still up to the individual advisers and is open to abuse.
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