Financial Abuse – how to spot the signs

19 July 2021

There are several reasons why someone may need the assistance of a financial deputy, stemming from incapacity due to an accident or a consequence of old age. There is however a darker side to this type of work that Court of Protection lawyers are seeing more and more of. This relates to those who have suffered some form of financial abuse and/or undue influence.

Within the last few years, the number of cases that have been referred to professional deputies by the Court of Protection that include an element of financial abuse has soared. With over 3,000 investigations conducted by the Office of the Public Guardian (“OPG”), the supervisory body for all attorneys and deputies, in 2019-20 alone. Over 30% of these investigations resulted in court proceedings and potentially the removal of an attorney and/or the appointment of a professional deputy. This is a worrying trend and one that only seems to have been exacerbated by the COVID crisis.

In many cases, the abuse has been inflicted by those who are closest to the person in question, and the aftermath can have devastating consequences on their financial position and also their health and wellbeing.  It is therefore vital that the signs of financial abuse can be spotted as early as possible to limit the damage caused and to help those who are suffering.

Who commits financial abuse?

In many of our cases, the people who commit the financial abuse are often the people you would least expect, including family, friends, neighbours and carers – those with whom the victim is closest and trusts and relies upon. In many cases they are the people that have been specifically appointed to protect the assets of the abused, such as an attorney or attorneys under a Lasting Power of Attorney/Enduring Power of Attorney (“LPA”/“EPA”), a deputy or other professional. It is the relative ‘closeness’ to the victim that allows ease of access to their finances and is why many of these cases go unrecognised. 

If someone has caused financial loss which would be deemed as financial abuse or undue influence, it does not necessarily mean that the abuse was intentional. In many cases the abuser has an honest belief that they have a legal or moral right to the funds. For example, where a child has been appointed to act as attorney under an LPA and proceeds to take funds held by the parent on the premise that it is an ‘early inheritance’. This is just one in a number of scenarios that may be deemed as financial abuse by the Court.

Examples of financial abuse or undue influence

Below is a non-exhaustive list of examples that may constitute financial abuse and/or undue influence and of course there are many different ways in which this type of abuse can occur. The abuse below may occur where the victim still has mental capacity to make their own decisions or where they may lack all mental capacity to make any decisions regarding their financial affairs (this would be where an attorney or deputy may be appointed):

  • Use of cash funds;
  • Use of credit or debit cards;
  • The transferring of funds from a victim’s account;
  • The transferring of benefits or other income into the attorney/deputy or a third party’s account;
  • The setting up of Direct Debits or Standing Orders for payment of items that are not for the victim;
  • Influencing or instructing the sale of assets, such as property or investments;
  • Influencing or instructing the purchase of assets;
  • The buying of expensive items, such as cars,  computers and often justifying those as being for the benefit of the victim when the victim has no need of them  .;
  • ‘Gifting’ of assets, particularly in some cases where the abusers are of the view that the State should fund the care fees of an elderly person and thus attempt to deprive these assets toward care costs;
  • The ‘early inheritance’ stance (as detailed above);
  • Deprivation of assets such as non-payment of care fees or utilities; and
  • The changing of legal documents such as a Will, trust, investment or pension.

Signs to look out for

It is an unfortunate fact that many cases of financial abuse will go unnoticed and/or unreported. Most victims tend to be reluctant to discuss their financial affairs with others due to embarrassment or undue influence from the person committing the abuse. In many cases where the victims lack capacity, they may not have the ability to understand what is happening to them to be able to ask for help.  Therefore it is important that subtle signs of abuse are noticed where they can be, such as:

  • Changes in spending habits;
  • Lack of cash funds where there may previously had been plenty;
  • Non-payment of essential items such as care fees, utilities, basic food and washing supplies;
  • Changes in appearance, level of personal upkeep and living standard;
  • Changes in mood and behaviour;
  • Threatening comments or behaviour of those in close contact with the victim;
  • A sudden drop in asset value;
  • Unexpected or sudden sale or purchase of items where there had been no previous like spending or intention;
  • An increase in spending by those close to the victim who may have direct access to funds; and
  • Unexpected changes to legal documents where there had been no prior intention by the victim.

Again, these are just a handful of the potential signs of financial abuse that can occur, so it is always best to be vigilant.

For those who are acting in a professional capacity, such as attorneys or deputies, then it is a fundamental part of your role to be aware of the authority you have, as well as the legal restrictions placed on you. Merely having an LPA or Deputyship Order does not give blanket authority to take any action regarding the donor’s financial affairs as any decisions you make must be in that person’s best interests. If you are unsure, it is always best to check the LPA or Order and seek professional advice where necessary.

What to do if you suspect financial abuse

If you suspect someone is the victim of financial abuse; please contact the OPG if you are aware that the person is a donor under an LPA or deputyship. If there is no LPA or deputyship in place, or you are unsure as to whether there is one, please contact social services to raise a Safe Guarding Alert. Both organisations will look to make further enquiries and, if necessary, take steps to protect and prevent any further abuse.

Further information

If you have any concerns about capacity, or if you are contemplating making a LPA for the first time, please get in touch with our team for more information. 


About the author

Lauren Eyre joined Kingsley Napley's Court of Protection team in 2017, she deals with the management of deputyships, with a focus on clients diagnosed with dementia and those that have suffered medical negligence resulting in serious brain injuries and long term impairments. Lauren qualified as an Associate, Chartered Legal Executive via CILEx in 2020.


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