Am I in big trouble??

[Bigcoat1]

Hi Everyone,

i think I might be in big trouble. My mum passed recently. For the last 4 or 5 years I held power of attorney and handled all of her financial affairs. We never had a formal diagnosis of dementia etc, however she became Increasingly confused so I just took over.
mum was quite well off with around 150k in savings, an income of 2k per month and a mortgage free home. My finances have been difficult since my divorce.
On a few occasions I borrowed from mom’s account when I was desperate. I always paid the money back asap. I never discussed this with mum although I know she she would have consented.
her affairs are now being looked over as part of private etc and I’m terrified that this roll come to light and I’ll be in huge trouble.
I know I can’t undo what’s been done, but what should I expect to happen?

Everyone saying its no big deal, is not giving an educated answer.

I'm not immediately saying you will be in big trouble for it and in fact no one may ever find out, clock it or care BUT giving yourself a loan then paying it back is not allowed under the rules of POA and is considered financial abuse.

The account holder is not capable of making their own financial decisions, hence the reason for a POA therefore absolutely cannot agree to loaning you money, its not a grey area, it is very black and white and saying "no one will know you didn't ask" is ridiculous, it doesnt matter if you did and DM said "of course", she cannot make her own financial decisions...again, hence the POA.

If someone has found an anomaly in the accounts and its an official investigation by the Office of the Public Guardian, then yes, it probably will be discovered.

No,

Firstly a dementia diagnosis does not immediately mean a person lacks capacity - there is no way to prove she didn't OK you borrowing the money

and second, assuming it was all paid back there can be no question of anything untoward.

What they will be looking at is primarily the state of her finances now, and if its a council assessment, taking a cursory look back for any major expenses that could be classed as deprivation of assets.

Assuming the money was put back, you have nothing to worry about.

But in general it's best to be 100% transparent when acting as a POA (as I do for my mum) and keep everything separate and keep a log as to what was spent and why.

I agree that you abused your position and took advantage of a vulnerable person. Sad.

Thanks for posts. I’ll try and answer all questions here….

so I’ve always paid back what I borrowed. At the point of mums passing I had paid back £250 of a £500 loan.

when mum was able, she withdrew regularly lend/ give me money, so I know that she wouldn’t have an issue, even though I know it’s against the rules.

I do have a sibling but I am sole executor as my sibling isn’t very involved

I do feel very guilty but I’ve really struggled

That's not strictly true, I hold and use POA for my mum as she is housebound and disabled, its logged with the bank etc, but she still has full capacity - and can be fully involved with any decision making - she just can't do the tasks.

What the OP did was unwise, but unlikely to result in any issues, and given what is being done unlikely to be noticed.

OP, sorry, when you say her affairs are being looked at as part of private etc. what do you mean by that??

I only scan read your initial post and completely missed she had passed (condolences) and thought it was a care assessment.

Yes but if a lasting POA was in effect for financial decisions with you as trustee you were ultimately making the decisions irrespective of her input. In that situation if you paid yourself a loan from her account even with her consent you were breaking the law. If she was capable of making decisions then the POA should not have been effected. You cant have it both ways.

So who are you telling? (Apart from your friend). Surely if anyone with any authority asks questions you say mum loaned you money and you paid it back

Indeed, and I can't see why the OPs mums finances are being looked at for (I assume she means probate, not private)

As executor she should fill out IHT400 (if needed) and the probate form, nothing gets looked at in detail, been there and done it.

Then you distribute the estate. That's it.

I'm in Scotland, so it may be different elsewhere, although I believe the rules in England and Wales are the same, but a POA relating to Financial matters doesn't only come into play when the person granting the POA is incapable of making their own decisions. It comes into effect whenever the person granting it wants it to. I helped my Mum do her Finances from around 4 years before she died, but only did everything for her for around a year before she died - and we discussed everything I did before I did it, with her. She found it increasingly difficult to concentrate long enough, to deal with her financial affairs herself, but she was still able to say what she wanted to happen almost to the end. She was only deemed to have lost capacity 3 days before she died.

@Bigcoat1 If your Mother would have wanted to help you out with loans AND you have paid it back and there is a Paper trail showing the money was paid back, it is unlikely you will be in any trouble. You say she was never diagnosed with dementia, so why didn't you discuss it with her?

Literally no one is going to probe - as executor you just use the totals of monies, assets etc at the time of death and bung them into the probate form and if over the threshold IHT400 -

No one back tracks through bank statements forensically - it goes off, probate gets granted and you dole out the money.

If the OP has got an accountant involved or something, that's a massive waste of money, but even they won't go back through, its what was in the pot at death that counts.

Not sure that is correct @Weekmindedfool I have POA and when it was granted it is specifically noted my MIL who I have it for has mental capacity. I was told sometimes problems occur because people wait until too late to apply, and capacity is not there, so POA not granted as they cannot agree. I only have it because she physically cannot handle her affairs, ie go to the bank, use the internet etc.
I pay her bills using her account for her expenses, and occasionally it is easier to have payments to me, then to a third party, ie Tesco as I have an account but she doesn’t. The money then goes to Tesco for her shopping, but comes into my account first. This is with her explicit agreement, as she has capacity.
Maybe there are different types?

Dont tell anyone else. When it comes up. If it does just say your mum gave you loans and you paid them back .

Is it you think that your siblings is going to make it an issue?
have you put the rest of the last £250 you took back?

That's plain wrong!

If you paid it back and have a record then how do they know your mum didn't ok it? If however you took it and didn't pay it all back then yes that could be questionable. If you are executor just make sure you minus what you loaned off your total before splitting the money between anyone else so it's all above board.

your mum has passed away now, how would anyone know you didn't ask?

What you’ve done is totally unethical. Stop making excuses for yourself.

This is the risk you took when you “borrowed without asking” (stole) from your elderly mother.

Friend is probably just trying to be a dick because she knows you will be "coming into some money"

I struggle but I don’t have access to someone else’s money to dip into when I need it. I think you’re only bothered now because you know it might get found out, otherwise it wouldn’t have crossed your mind to worry about it. Realistically as it’s paid back I doubt anything will come of it, but it is naughty what you’ve done, your mum hadn’t consented to it, you are assuming she would have been okay with it which is something totally different.

But who is viewing it, and viewing it as theft - if you are executor then sorting out her finances falls to you, no one will be checking.

Only time that would happen is if the will was challenged or the executor challenged by a beneficiary..

Did you have an official POA? Issued bybthe office of the Public Guardian? POA for financial or welfare matters is for using when the person lacks the capacity to make their own decisions. It dosent sound like that was the case for you?

My exh blatantly fleeced his dm of 40k. The will went to court and nothing happened. He still got half her house with his db getting the other half.
You sound like a good dd. Stop thinking you are anything less.

My uncle drained my grandmothers bank account before she died. Nothing happend.