Words of prey
When Darren Ashton of Shirley, Birmingham, was recently jailed for defrauding an elderly couple over a ten-month period, this was a wake-up call for what can go wrong with power of attorney arrangements.
Marjorie Willits, 92, and Eric Dickinson, 87, lost £264,173.18 to their appointed attorney, who, among other things, used the misappropriated funds to prop up his business and fund a property dispute. Birmingham Crown Court sentenced Ashton to five years.
As reported in the Daily Mail, the police hope to recover as much of the misappropriated funds as possible by virtue of their powers under the Proceeds of Crime Act.
But Ashton was described by his defence lawyer as “financially destitute”. Therefore, it is unlikely the couple will get back all their money. Of particular note is the fact that Ashton was able to access their funds by virtue of being appointed as attorney for both Willits and Dickinson.
There is nothing in the press to suggest that there was any evidence of Ashton’s dishonest intentions at the time of executing the power of attorney. Indeed, it is acknowledged that there was a friendship between him and Willits and Dickinson ostensibly. Apparently they had made him a “significant beneficiary” of their wills. So it may have been impossible to detect potential fraud.
However, it does prove that steps should always be taken to minimise the risk of assisting in the preparation of an inappropriate power of attorney and, inadvertently, facilitating fraud.
Full picture
The issue is more than simply best practice. The Solicitors Regulation Authority code of conduct 2011 states that one outcome solicitors must achieve is: “…when deciding whether to act, or terminate your instructions, you comply with the law and the Code…”
It goes on to clarify that indicative behaviours to measure achievement of this outcome include ensuring that a client has capacity and is acting on their own volition. Both these points are particularly salient in the context of taking instructions for a power of attorney.
Elderly client practitioners know appropriate strategies for assessing the capacity of their clients, such as questions about personal details, financial and living circumstances, their family tree and their wishes. They also know that an opinion from the client’s GP may well be sensible and that it may be advisable to ask the GP to act as certificate provider (see ‘Identity Parade’).
Spotting undue influence issues may be more difficult. The Solicitors for the Elderly elder abuse strategy 2011 provides useful guidance for practitioners in this respect. In particular, it recommends that a solicitor should exercise greater care if taking instructions from a donor not previously known to them. More specifically, a donor must be seen alone for at least part, ideally all, of a meeting, and it is imperative to be aware of other people who may be present, or waiting outside – possibly providing prompts to clients.
Stay vigilant
Broader questions about any existing documentation, such as a will or an advance directive, as well as about family circumstances, can be useful indicators of whether or not the received instructions reflect a client’s true wishes. Also be vigilant when considering whom the client would wish to stipulate as a named person for notification; particularly if that is seemingly at odds with the family tree provided.
And steps can be suggested to safeguard against future abuse, such as encouraging the client to have more than one attorney. A further step is suggesting a restriction stipulating that accounts must be produced to a third party (such as an accountant or solicitor) on a periodical basis.
Unfortunately, none of the above precautions can guarantee the Ashton case will be the last of its kind. Determined fraudsters will undoubtedly continue to try to find a way of cheating the system and vulnerable people. For this reason, elderly client practitioners must stay vigilant. It’s the only way to ensure that they are ?doing their utmost to protect clients.
Matthew Evans is a partner at Hugh James