Member Article

New moves by banks could freeze joint bank accounts

A specialist in Wills and Probate has warned that a move by high street banks could leave joint accounts frozen if one of the accountholders becomes mentally incapable.

Carolyn Tilly, Partner with Tilly Bailey & Irvine Solicitors and head of the company’s Wills and Probate department, reported that the British Bankers’ Association has issued new guidance making it common practice for high street banks to freeze withdrawals (apart from existing mandates) from a joint account should they discover that one party is mentally incapable. The account would then remain frozen until a Power of Attorney is produced or a deputy is appointed through the Court of Protection, which is a long and costly procedure.

Mrs Tilly said: “Until now, joint accounts, where either party could sign, would allow day to day money to continue to be available. However, this move by the banks could cause couples sudden financial difficulties.

“The banks are entitled to change their mandate terms whenever they wish, and now the only way to ensure joint accounts are not frozen is to be a step ahead of the banks. We must now recommend that all joint account holders, of whatever age, should put in place a Lasting Power of Attorney. Each person is then legally entitled to act on behalf of the other should the other lose mental capacity, allowing continued access to bank accounts.”

A Lasting Power of Attorney (LPA) is a legal document which allows a person to name another who they trust to make decisions on their behalf about property, financial affairs and/or personal welfare should they be no longer able to make those decisions themselves. Mrs Tilly adds, “An LPA is an important document and I would recommend advice be taken from a legally qualified person to avoid the risk of complications or abuse.”

Tilly Bailey & Irvine Solicitors holds free ‘Wills and Probate’ surgeries at its offices in Hartlepool every Thursday and Stockton every Wednesday, and has recently begun an additional weekly surgery every Wednesday at its Wynyard offices. An appointment for any of these surgeries can be made by calling 0800 052 6824.

Tilly Bailey & Irvine Solicitors is the Tees Valley’s largest full service law firm with offices in Hartlepool, Wynyard Park, Stockton on Tees and Barnard Castle.

This was posted in Bdaily's Members' News section by Tilly Bailey and Irvine Solictors .