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For years, we’ve been advised of the benefits of setting up a lasting power of attorney (LPA) so that, if we lose mental capacity, someone will be able to step in for us and handle our affairs.
The message has worked. The number of LPAs has soared in the past 20 years with around six million currently registered, according to government figures.
But there’s also a problem. While we’ve been setting up the paperwork, some institutions appear under-prepared to play their role fully in an important area that requires plenty of collaboration. Having followed the LPA route, here’s potentially what to expect.
What’s on this page?
An LPA is a legal document that allows you to appoint someone you trust, known as your attorney, to make decisions on your behalf if you ever lose the mental capacity to do it yourself.
There are two types: one covering financial affairs and the other your health and welfare. In this feature we’re focusing on financial LPAs, which give your attorney the authority to manage your bank accounts, investments, property, and other financial matters. One important thing to remember: an LPA must be set up while you still have mental capacity, so it’s a job to get on with sooner rather than later.
Setting up an LPA can come with its own issues as we’ve covered elsewhere. But the real difficulties often begin when attorneys try to use the document, with many facing an uphill battle to handle their loved one’s financial affairs.
Philip Martin, CEO of Unique Financial Planning, has had an LPA in place for his parents for nearly 20 years but only started having to use it recently. He has found the practical experience deeply frustrating, describing it as a lottery.
“Right from the get-go, if you walk into a bank branch to say, “I’ve got power of attorney, here are all the details”, depending on who you speak to you’ll either get “yes, we can do something about that”, or “no we can’t”. Staff lack training on how to handle this. Some seem to make it up as they go along.”
The financial regulator is aware of the problem. The City watchdog, the Financial Conduct Authority (FCA), published a good practice guide for financial institutions when dealing with powers of attorney in 2023. But there seems to be a huge gap between awareness that there is a problem and doing anything about it.
Last year, the FCA reviewed how banks and building societies were handling power of attorney and found that the picture varied widely between different businesses. Given that most attorneys will need to deal with multiple institutions, there is a real need for a uniform approach to LPAs across the industry.
Emad Aladhal, director of retail banking at the FCA, says: “When banks and building societies get it right for their customers they can make a real difference at a difficult time.
"But when they fail to recognise and respond to customers who need more help, it adds to the stress. All firms should consider where they can make improvements.”
So, what should you prepare yourself for if you are going to act as an attorney in the future?
Once you have registered an LPA with the Office of the Public Guardian (OPG) you also need to register it with every bank, building society, pension provider, investment firm, and utility company that the person you are acting for has accounts with.
This can mean a lot of legwork, as many companies require you to do this in person. Not an easy task, if you don’t live near the person on whose behalf you are acting.
Joanna Clarke, head of personal current accounts at Lloyds Bank, says: “Many people only start thinking about LPA when they urgently need it. But planning ahead can make things much easier.
“One of the best ways to avoid delays is to make sure the paperwork is ready and contact your bank as early as possible.”
If you are lucky, the firm you are dealing with will accept a digital code, saving you the hassle of visiting in person. Any LPA registered with the OPG after September 2019 comes with a unique access code that allows organisations to verify LPA details online.
But not all institutions are set up to use the service. So, for older LPAs, you will need to bring either the original document or a certified copy. Photocopies won’t be accepted, and if you have accounts with multiple companies, you will need a certified copy for each one.
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, says: “If you have several bank accounts you will need to register with each one, so it’s a good idea to have several certified copies of the LPA available.”
You can read government guidance on how to certify a document here.
Managing accounts virtually is the norm these days with 84% of us using online banking, according to YouGov. It’s natural, therefore, that many attorneys would want to be able to log in to their family member’s accounts to manage them. But this is far from easy.
Some companies are set up to give attorneys their own digital logins, but many don’t. Without one, you will need to use the account holder’s own log-in details. This can mean that security verification texts, or calls, go to their phone rather than yours.
“I’ve had the ignominy of putting my dad, who’s got dementia, on the phone to verify that that’s what he wants to do with his account, thereby negating the entire purpose of an LPA. It’s ridiculous,” says Philip Martin.
“The optimum would be that I’ve got my own login to Mum and Dad’s account. It’s already verified. All the biometrics apply. I can operate it as though I were them. That’s what it should be.”
One thing that can cause further problems is if more than one attorney has been appointed. One bank confirmed to us that it can set up online access for a single attorney, but that it is impossible for joint attorneys as they need to act together – meaning decisions cannot be made unilaterally online.
Once you’ve figured out how to register your LPA with one institution you may find the process is completely different with the next, putting you back to square one.
You may also find how your role as an attorney is handled can change every time you contact the same company, depending on who you deal with.
There appears to be very little training on how staff should handle LPAs and virtually no consistency across the sector.
For example, what version of your LPA will be accepted can vary. Sarah Coles, head of personal finance at AJ Bell, says: “There have been reports of companies demanding to see originals and refusing to accept certified copies.”.
The industry acknowledges it needs to do better. Peter Tyler, director of personal banking at UK Finance, says: “Third party access and mental capacity continue to be a priority area.
“We know there is more to be done, and we are working with our members, government bodies, and third-sector charities to improve supported and delegated customer journeys and ensure greater consistency across the industry.”
The current system for acting as an attorney on a financial LPA can be frustrating. The industry is aware of the problems so, hopefully, things will improve in the future.
In the meantime, the best protection is preparation: get your LPA registered early, make sure you have plenty of certified copies ready, and consider how many attorneys you appoint. More than one can cause issues with accessing accounts online.
On a final bright, and perhaps surprising, note Philip Martin says that his parents’ local council, Perth and Kinross, has been adept when it comes to managing the handling of their LPA. He describes the experience as “seamless”.
“They know exactly who we are. I send the invoices off, and payment is made two weeks later. They manage it perfectly successfully,” he says. “The local authority seems to be able to do it. But a bank can’t.”
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