Banks and building societies will freeze a late customer’s account once they are notified of the death and usually will require a Grant of Probate before releasing funds to Executors.
The Grant of Probate is important as it ‘proves’ the Will i.e. confirms the validity of the Will and it confirms who the people authorised to administer the deceased’s estate are – the Executors.
In the absence of a Will, a Grant of Letters of Administration should be applied for which again confirms who has authority to administer the deceased’s estate.
What are the banks doing?
There used to be a standard amount that could be released without the need for a Grant of Probate.
However, this changed in 2017 when guidance was published for the banks allowing them to decide how much they would be willing to release without seeing a Grant of Probate or Letters of Administration.
Unfortunately, the banks have not agreed on a uniform amount and instead each bank has its own limit.
Despite this, it is now becoming increasingly (and alarmingly!) common for banks and building societies to release large sums of money, over and above their limits, to anyone who provides them with a death certificate and claims to be the person dealing with the deceased’s estate.
What should Executors and Administrators do?
This is of huge concern because money is being released to people who are not the Executors and Administrators of an estate (sometimes £100,000s!!). In most cases this tends to be a well-meaning family member who was trying to do their best, but in some circumstances the money can end up in the hands of an estranged family member (who has perhaps been left out of the Will) or in the hands of individuals who are deliberately acting fraudulently.
Recovering this money is then problematic, time consuming and costly for the Executors and Administrators.
Whilst it may be easier just to close the accounts and take the money without a Grant of Probate or Letters of Administration it can often cause more problems (and costs) in the end. The family and/or friends of a deceased should speak to a Solicitor as soon as possible following the death, to ensure that the estate is administered properly and without delay.
It is, of course, also important to ensure that you have prepared a Will to choose the people who you would like to deal with your estate following your death.
If you would like further advice about applying for a Grant of Probate or Letters of Administration or in relation to preparing your Will and Lasting Powers of Attorney, please do not hesitate to contact me on 01530 564 498 or c.day@timms-law.com.
