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Loans and Mental Health

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M3ssiM3ssi Forumite
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First Post
MoneySaving Newbie
I hold Legal Power of Attorney for my father which was validated a few months before he was diagnosed with Alzheimer's. A few months after he was diagnosed a family member ,who had moved into my parents home, took out a couple of loans impersonating my father and using fathers bank account and credit cards for identity (they have the same initial and surname sfter changing their name on leaving prison). I did not discover these loans for some 18 months as my mother assured me that all was well. I eventually discovered the fraud and reported to the police. My mother refused to believe my sibling had done such a thing and did not allow the police to prosecute them. The Office of the Public Guardian advised that my parents bank accounts needed to be separated, which was done. The loan repayments I have refused to pay from my fathers account.
Things have dragged on and my sibling has now started referring the debt collection agencies to my address in my fathers name.
I have replied to the debt collection agencies stating the loans were fraudulent and they should take up the matter with my sibling, supplying a copy of the diagnosis and the LPA to them.
My question is - Is the loan contract valid seeing that it was signed in my father name AFTER he was diagnosed with Alzheimer's ? What can I do with these debt agencies other than keep referring them back to the sibling ?

thanks
M3ssi (apology for anonymity)
 

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Replies

  • zx81zx81 Forumite
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    Your father's mental health doesn't have any bearing on it as the loans were not taken out by him.

    However, if he has accepted responsibility for the debt by not pursuing the sibling, then it's now his debt.

    If he had applied himself, his mental health would only have been an issue if he had informed the lenders before applying.
  • M3ssiM3ssi Forumite
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    MoneySaving Newbie
    My father's Alzheimer's is that far advanced he has no concept of loans, he does not even understand the concept of a loan and is unaware he has been paying it. 
  • zx81zx81 Forumite
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    I understand. But that doesn't change the situation he is in unfortunately.  According to you, he wasn't the one who applied for the loan.
  • M3ssiM3ssi Forumite
    5 posts
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    MoneySaving Newbie
    And the debt collection agencies are stating "Before we can discuss this matter with you we would require authorisation to be provided by 'my father' ". Even though I have provided the a copy of the diagnosis and the LPA. 

  • zx81zx81 Forumite
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    Then you need to reinforce the POA with them. If they won't accept it, go to FOS.

    I assume the POS you have is the financial one?
  • LifesAGambleLifesAGamble Forumite
    44 posts
    10 Posts
    What a horrible situation.  I would ignore what family say and report the lowlife to the police and provide as much evidence as you can.  
    Life's a gamble, be lucky!
  • M3ssiM3ssi Forumite
    5 posts
    First Post
    MoneySaving Newbie
    Yes the LPA is Financial, I have now sent all the documents to both debt agencies again, asking for copies of the signed contracts in order to prove the signature is forged. Also threatened to report to Credit Services Association and Financial Conduct Authority if they don't start behaving.
    Have reported the sibling to the police on several occasions but they are loath to engage as Mother says he didn't do it / and she gave permission for them to do it???  
    Doesn't help that local authority social care got themselves involved but do not or verify any of the claims / facts despite being provided with hard copies of everything. Useless bunch of oxygen thieves are allowing them to continue taking parents money.

  • lees80lees80 Forumite
    160 posts
    100 Posts
    M3ssi said:
    Yes the LPA is Financial, I have now sent all the documents to both debt agencies again, asking for copies of the signed contracts in order to prove the signature is forged. Also threatened to report to Credit Services Association and Financial Conduct Authority if they don't start behaving.
    Have reported the sibling to the police on several occasions but they are loath to engage as Mother says he didn't do it / and she gave permission for them to do it???  
    Doesn't help that local authority social care got themselves involved but do not or verify any of the claims / facts despite being provided with hard copies of everything. Useless bunch of oxygen thieves are allowing them to continue taking parents money.

    Your mum cannot give permission for anyone to take out a loan other than herself. 

    If your father lacks capacity to manage his financial affairs, that is where the LPA kicks in. It is now your responsibility to manage his finances for him. Your mother and sibling should have no access at all to the account. 
  • Brock_and_RollBrock_and_Roll Forumite
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    My mother refused to believe my sibling had done such a thing and did not allow the police to prosecute them. The Office of the Public Guardian advised that my parents bank accounts needed to be separated, which was done. The loan repayments I have refused to pay from my fathers account.
    Things have dragged on and my sibling has now started referring the debt collection agencies to my address in my fathers name.

    Horrible situation, but look at this from the loan company's perspective. They believe that have a legally valid loan contract - representatives of the borrower are alleging fraud.....but refusing to prosecute the alleged fraudster. What does that tell you?
    This is a family matter - you either prosecute, or suck it up giving the relative a dusting as required.  Assuming you have LPA of your father's affairs if you carry on refusing to pay but not prosecuting all that is going to happen is that the recovery costs etc are going to eat into your fathers assets.

  • M3ssiM3ssi Forumite
    5 posts
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    MoneySaving Newbie
    There in lies the problem - my father did not make the contract , my sibling did and is backed by our mother. I am pushing for prosecution , but the local police (two man team covering a vast area) have chosen not to prosecute because of mother.
    The Court of Protection have ruled at as of the date of the diagnosis my father was not capable of making financial decisions, so therefore the loan contracts cannot be valid for either reason - fraud or mental capacity. 
    The debt belongs to the sibling or my mother, but the debt recovery companies are not listening. 
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