Attorney Investment Management Compliance Checklist
A Practical Reference for Attorneys Managing Financial Assets Under a Lasting Power of Attorney
Attorneys appointed under a Property and Financial Affairs Lasting Power of Attorney carry legal responsibilities that many do not fully appreciate when they accept the role.
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Where the donor's estate includes investments — whether a share portfolio, investment bonds, ISAs or other managed assets — those responsibilities extend beyond day-to-day financial management. Under the Trustee Act 2000, attorneys are subject to the same investment duties as trustees. They must apply the standard investment criteria, consider the suitability and diversification of investments, and in most cases take and have regard to proper advice from a suitably qualified professional.
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Failure to meet these obligations is not a technicality. It can result in a formal complaint to the Office of the Public Guardian, personal liability for financial loss, or – in serious cases – removal as attorney.
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This checklist is designed to help attorneys manage investment responsibilities in a structured, documented and legally defensible way. It does not replace professional legal or financial advice, but it provides a framework for demonstrating that your duties have been considered and discharged with appropriate care.
Section 1: Confirming Your Authority
Before taking any action in relation to investments, confirm the following:
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The LPA for Property and Financial Affairs has been registered with the Office of the Public Guardian and is currently valid.
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You have a certified copy of the registered LPA available to provide to financial institutions and advisers.
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You have reviewed the LPA carefully for any restrictions, conditions or guidance relating to investments or financial management.
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You are satisfied that acting in relation to investments is in the donor's best interests and consistent with any guidance provided within or alongside the LPA.
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Where there are co-attorneys, you have confirmed whether you are required to act jointly, jointly and severally, or subject to any specific conditions in relation to investment decisions.
Section 2: Assessing the Donor's Circumstances
Investment decisions made on behalf of a donor must be appropriate to that individual's specific situation. Before engaging an investment adviser or reviewing an existing portfolio, document your assessment of the following:
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The donor's current financial position — assets held, liabilities, income sources and anticipated expenditure.
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Current and likely future care costs, and how these should be reflected in the investment strategy.
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The donor's age and likely time horizon for investment.
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Any prior investment arrangements, including mandates, risk profiles or adviser relationships already in place.
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The donor's known wishes, values and attitude to investment risk — drawn from any guidance provided in or alongside the LPA, previous conversations, or written statements made by the donor while they had capacity.
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Whether any restrictions on investment arise from the LPA itself or from other legal arrangements.
Section 3: Appointing a Professional Investment Advisor
Under the Trustee Act 2000, attorneys managing significant investments must take proper advice. Selecting and formally engaging a qualified investment professional is not optional in most circumstances — it is part of fulfilling your duty.
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When appointing an adviser:
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Confirm that the individual or firm is authorised and regulated by the Financial Conduct Authority (FCA). This can be verified at no cost via the FCA Register at register.fca.org.uk.
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Satisfy yourself that the adviser has relevant experience of managing assets on behalf of attorneys and vulnerable clients.
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Document clearly why this adviser was selected, including any alternatives considered.
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Ensure written terms of engagement are in place before any investment activity begins, clearly identifying your role as attorney and the basis on which instructions will be given.
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Confirm that the adviser understands the legal framework within which you are operating and is aware of the restrictions or guidance contained in the LPA.
Section 4: Investment Policy Statement
An Investment Policy Statement (IPS) is the formal record of the investment mandate you have agreed with your adviser. It should exist for every managed portfolio held on behalf of a donor.
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The IPS should document:
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The investment objectives — capital preservation, income generation, growth, or a combination.
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The donor's risk tolerance and the basis on which this has been assessed.
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Income requirements and the anticipated timing and amount of withdrawals.
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The investment time horizon.
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Any asset classes, sectors or instruments that are excluded or restricted.
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The basis on which the adviser will report performance and how frequently reviews will take place.
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Ensure the adviser confirms in writing that they will manage the portfolio in accordance with the IPS. Review the IPS whenever the donor's circumstances change materially.
Section 5: Oversight and Ongoing Monitoring
Appointing an adviser does not discharge your ongoing responsibility. Attorneys retain a supervisory duty and must take steps to ensure the investment strategy continues to be appropriate.
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At each review period:
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Obtain written investment reports from the adviser covering performance, portfolio composition and any changes made.
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Review whether investment performance and portfolio construction remain consistent with the IPS.
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Assess whether the donor's circumstances have changed in ways that require the IPS or mandate to be updated – including changes in care needs, income requirements or life expectancy.
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Consider whether the adviser continues to be appropriate for the role.
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Document your review, the findings and any decisions or instructions given.
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The frequency of formal reviews will depend on the complexity of the portfolio and the pace of change in the donor's circumstances. Annual reviews are a minimum; more frequent monitoring is appropriate for larger or more complex estates.
Section 6: Record-Keeping
Attorneys are required to keep clear, accurate records. In the event of a complaint or investigation by the Office of the Public Guardian, your records are your primary means of demonstrating that you have acted properly.
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Maintain records of:
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All investment decisions made, including the rationale and the date.
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All communications with the investment adviser, including meeting notes, correspondence and reports.
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Copies of the IPS, all investment reports and all terms of engagement.
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Any professional advice received and the basis on which you acted upon it.
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All reviews conducted and the outcomes of those reviews.
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The donor's financial records must be kept entirely separate from your own. This is a legal requirement, not a matter of good practice.
Section 7: Best Interests - Ongoing Assessment
The obligation to act in the donor's best interests is continuous. It does not cease once an investment mandate is in place.
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At each formal review, and whenever circumstances change, ask:
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Does the current investment strategy still reflect the donor's needs, circumstances and known wishes?
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Have income requirements or anticipated care costs changed in ways that affect the appropriateness of the current portfolio?
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Is the level of risk in the portfolio still appropriate given the donor's age, health and financial position?
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Is there any conflict of interest — actual or potential — that should be disclosed or managed?
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Should further legal or financial advice be sought before proceeding?
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Where there is material change or genuine uncertainty, take advice before acting. Documenting that you sought advice — and what you did with it — is itself evidence of acting in the donor's best interests.
Record of Review
Date of review: __________________________
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Attorney or attorneys conducting review: __________________________
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Summary of findings:
__________________________________________________________________
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Actions taken or instructions given:
__________________________________________________________________
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Next review date: __________________________
Related Guides
The following resources expand on several of the issues raised above:
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7 Questions to Ask Before Creating an LPA — the key decisions to work through before you draft the document.
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Attorney Guidance on Investment Management — what the law requires of attorneys who manage financial assets.
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If you would like to discuss your own arrangements, the team at Wills, Tax & Trusts Ltd. is here to help.
Speak With Our Team
If you are acting as an attorney and would like guidance on your investment management responsibilities, or if you are in the process of creating an LPA and want to ensure it is properly structured, the team at Wills, Tax & Trusts is available to help.