Standard Bank Jersey Limited fined £20k for letting woman use dead partner’s account (August 2019)

Speed read

1. Standard Bank Jersey Limited was found guilty in the Jersey Royal Court after it admitted allowing a woman to use her deceased partner’s bank account to pay her rent and shopping bills.
2. Standard Bank Jersey Limited was sentenced for allowing the woman to access the account – which it accepted should have been immediately suspended – without obtaining paperwork required by the Probate Law.
3. Imposing the £20,000 fine – £15,000 less than the amount sought by the Crown – Lieutenant Bailiff Jurat Anthony Olsen said that the Court accepted that the bank’s staff had overlooked its own policy with the best of intentions in a bid to avoid hardship to their client’s partner.

Key issue for Jersey financial services

1. This is a case demonstrating one of the differences in Probate law between Jersey and the UK.
2. “Intermeddling” is a criminal offence in Jersey, that is,
   1. administering the assets of a deceased person without first obtaining a Grant of Representation.
3. On the other hand, in the UK it is legitimate and common practice to apply the deceased’s funds prior to obtaining the Grant of Representation for liabilities such as funeral expenses and inheritance tax.
   1. “Intermeddling” in the UK is an act showing an intention to assume the executorship which may invalidate a subsequent renunciation.

Key details

1. Crown Advocate David Hopwood, prosecuting, explained
   1. that the deceased, who died aged 80 in Kenya last year, was in a long-term relationship with a woman to whom he left the bulk of his estate.
   2. This included an account containing £49,953.41 at the time of his death.
2. Advocate Hopwood told the Court that the bank had a formal written policy to deal with what should happen when a client died which included
   1. blocking accounts until the formal grant of probate had been secured.
3. In this case, however, none of their own requirements had been complied with.
   1. Instead, a member of staff had agreed to keep the account open between the beginning of August and 7 November 2018 when the error was discovered and the account finally locked down.
   2. During that period, some £9,552.49 had been used to pay for rent, medical and restaurant bills, and shopping.
   3. When the error was discovered on 7 November, the bank spoke to the deceased’s partner who agreed to reimburse the account.
4. Later that month Standard Bank notified the Jersey Financial Services Commission and the Attorney General of their mistake. it said in a letter to the Attorney General.
   1. “The breach [of the Probate Law] resulted from an incorrect decision that the Bank’s normal procedure could be overridden in the circumstances,”

The fine

1. Moving for a fine of £35,000, Advocate Hopwood told the Court
   1. that although the amount of money involved was relatively small, Standard Bank’s offence had been exacerbated by the fact that they had taken a conscious decision not to lock down the account and had kept no record of the discussions leading to their decision.
2. Advocate Matthew Cook, representing the bank,
   1. offered an “unreserved apology” and told the Court that their staff, acting to try to help their client’s partner who was also his joint executor and principal beneficiary, had not appreciated the consequences of their actions.
   2. “There was no conscious decision to breach the Probate Law or to commit an offence. Had they realised the implications, they would not have taken the actions they took,” he said.
3. Advocate Cook explained
   1. that the bank had thoroughly reviewed its procedures in the light of the incident and had added further robust procedures to ensure that additional checks and balances were introduced in future.
4. Delivering the Court’s sentence, Lieutenant Bailiff Anthony Olsen noted
   1. that there was no intention on the bank’s part either to dissipate their client’s estate or to evade stamp duty, which was subsequently paid in full
5. In reducing the fine sought by the Crown, he said the Court took into account a number of mitigating factors including the voluntary admissions and guilty plea, the fact that there had been no loss to the estate, the revised policies implemented by the bank and its previous unblemished record.
   1. “The bank has behaved impeccably since the matter was discovered’, the Lieutenant Bailiff commented, as he imposed a fine of £20,000.

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