When someone close to you can no longer manage their own finances or make decisions about spending their money, there’s a real risk that money could be misused or essential bills left unpaid. Sometimes, family members try to help without the right legal authority; other times, vulnerable people are at risk of being exploited. Acting early to safeguard assets protects the person and reduces the chance of future disputes, when emotions are high as estates are being distributed and money has been spent.

Here, the contentious probate and trusts team at Switalskis looks at how the Court of Protection provides a legal safety net when someone can no longer manage their own affairs.

How the Court of Protection protects finances

When a person loses mental capacity and no valid lasting power of attorney (LPA) or enduring power of attorney (EPA) is in place, the Court of Protection provides a legal safety net. It can appoint a deputy to manage that person’s property and financial affairs, pay bills, collect income, and maintain or sell assets such as property when necessary.

Deputies must follow strict duties under the Mental Capacity Act 2005. They have an obligation to:

• Act in the vulnerable person’s best interests.
• Keep finances separate and maintain accurate financial records.
• Seek the court’s permission for major transactions.
• Provide annual reports to the Office of the Public Guardian (OPG), which supervises deputies and investigates financial abuse where concerns are raised.

Putting the right legal authority in place early prevents informal money management situations that could be questioned later. Accurate records of how finances were handled make it easier to manage someone’s finances during their lifetime and later when the appointed persons settle the estate, it can reduce the risk of probate disputes, such as allegations of financial abuse, and show that the person’s wishes were followed.

Why financial safeguarding matters for future probate disputes

Good financial safeguarding while someone is alive supports both their wellbeing and the smooth administration of their estate later. When the Court of Protection appoints a deputy or oversees major decisions, it creates a clear legal record of how money and property were handled. A deputy will often be a close relative or friend, but it may also be a professional such as a solicitor. 

Without this oversight, there is a risk of financial abuse or exploitation. If there is evidence of large or unusual gifts made shortly before the person’s death, property sold for less than its true value, or unexplained movements of money between accounts, families may later raise questions about how their loved one’s affairs were managed.

If the person lacked mental capacity but their will was changed or assets were transferred, this can trigger challenges about testamentary capacity or undue influence during the probate process. This usually leads to considerable delays and distress to family and beneficiaries. 

A clear paper trail is central to financial safeguarding. Records showing why and how decisions were made can later demonstrate that a vulnerable person’s finances were managed appropriately. It may also be beneficial to make gifts and other distributions out of the person's finances, for their own benefit or to avoid considerable tax implications upon death or beforehand. Where an attorney or deputy has acted without proper documentation, or there are unexplained transfers, sales, or gifts, these gaps can become grounds for a claim for financial abuse or abuse of powers. 

Having the Court involved, or acting under a properly granted lasting or enduring power of attorney, helps avoid these disputes by showing decisions were made lawfully and in the vulnerable person’s best interests.

Health and welfare decisions alongside financial safeguarding

The Court of Protection does not only deal with money. Where a person has lost mental capacity, the court can also make health and welfare decisions on their behalf - for example, deciding where someone should live, approving or refusing specific medical treatment, and regulating contact with certain people. The court may appoint a deputy to make health and welfare decisions, or issue court orders to reflect its decisions and provide legal authority. This can reduce the risk of later disputes about care arrangements and spending.

Families often assume these issues are separate from financial safeguarding, but they often connect closely. Care costs, living arrangements and decisions about selling property can influence the size and structure of someone’s wealth and eventually their estate.

When local authorities and safeguarding teams become involved

Local authorities have statutory safeguarding duties under the Care Act 2014 and can raise concerns where a vulnerable adult may be at risk of financial abuse or cannot make safe decisions about their affairs. In urgent cases, they can apply to the Court of Protection for interim orders - such as freezing bank accounts or approving a change of living arrangements - while a full investigation is carried out.

If the local authority becomes involved with your relative’s property and financial affairs or personal welfare, it is wise to seek legal advice immediately. A solicitor can review the proposed action, advise family of their options and present evidence of the person’s wishes and apply for your appointment as a deputy or litigation friend where appropriate. This protects your loved one’s best interests and makes sure family input is considered in any court proceedings.

The specialist court is responsible for protecting vulnerable individuals by assessing mental capacity when someone may have lost capacity and needs help managing their affairs.

Taking action if you’re worried about financial abuse

If you’re concerned that someone who lacks capacity is at risk of financial abuse or that their assets are being mishandled, there are actions you can take. You may also have concerns about someone’s estate after their passing and how someone managed their finances during their life. Start by gathering as much evidence as you can - this might include bank statements showing unusual withdrawals, unpaid bills, records of property sales or gifts, and notes of conversations or concerns raised by other family members.

If you have concerns about a registered LPA, EPA or a court appointed deputy, contact the Office of the Public Guardian to make a report. This body has the power to investigate attorneys and deputies and step in if there are safeguarding concerns. The OPG can request financial records, question decision-making, and, where necessary, limit or remove an attorney’s or deputy’s authority.

It’s also vital to seek specialist legal advice. As solicitors experienced in contentious probate matters the experts at Switalskis can advise on the best next steps, apply for urgent protective orders where assets are at immediate risk or begin the process of appointing a deputy to manage a person’s affairs safely.

How Switalskis can help

At Switalskis, we understand how distressing it can be to worry about a loved one’s finances. Our Court of Protection solicitors combine specialist legal knowledge with a compassionate, practical approach. We can:

• Challenge misuse of an LPA or EPA and report concerns to the OPG.
• Apply for deputyship orders, statutory wills and urgent protective measures.
• Build clear, persuasive evidence to protect a vulnerable person’s assets and reduce the chance of later probate disputes.

If you’re concerned about someone’s financial affairs or want to reduce the risk of future conflict, contact Switalskis today. Call 0800 138 0458 or get in touch through our website and one of our solicitors will respond at a time that works for you.