In the last of four articles about using a Power of Attorney or Deputyship Order to make gifts, we talk about what happens when Attorneys overstep the mark and make unauthorised gifts?
The Office of the Public Guardian (OPG) can investigate any gifts or spending made on the half of the Donor.
The Attorney must keep the Donor’s assets separate from their own or anyone else’s (except long held joint accounts) and must keep a complete and accurate record of all transactions they make for the Donor. This includes gifts to themselves and others and the reason for making them.
Deputies must include gifts in the annual report to the OPG, who have the power to investigate complaints and concerns about an Attorney’s actions.
If the Attorney makes gifts beyond their authority without Court approval, the OPG may
- Apply to the court to have the Attorney removed or suspended
- Apply to the court for the Deputy’s security bond to be called in – the bond provider would then seek repayment from the deputy personally
- Instruct the Attorney to apply for retrospective approval of the gift
- Ask the Attorney to have the gifts returned
- Refer the matter to the police
- The court may arrange a hearing before a judge, for the Attorney to explain their actions. This emphasises why record-keeping about the gift is crucial.
- A new Attorney may be authorised to take legal action to recover gifts.
- Where large gifts have been made, the OPG may ask the police to investigate. Fraud by abuse of position is a criminal offence
These are not happy outcomes. Be very careful making gifts and do not readily accept gifts when you are someone’s Attorney. If they insist, and why shouldn’t someone make a gift if they want to, get an independent solicitor to talk to them about it to make sure they have the capacity to make it and to have a note of reasons why. Keep thorough records. It does not matter how good and honest your intentions are if you fail to prepare for challenges or end up in a police interview with no information to back you up. Don’t let this all put you off- if in doubt, get advice first!