A scathing new review by the Financial Conduct Authority (FCA) has exposed significant shortcomings in how UK financial institutions handle two of the most sensitive customer needs: dealing with death and registering powers of attorney.
The findings paint a bleak picture: emotionally raw families left chasing paperwork for weeks, frozen accounts making it impossible to pay funeral bills, and carers facing repeated requests for documents already submitted—often while managing their own mental health crises.
“Unacceptable Barriers for the Most Vulnerable”
The FCA reviewed procedures at a wide range of high street banks and building societies, uncovering a pattern of inconsistent processes, untrained frontline staff, and digital systems that fail to account for customers in crisis.
“The financial services sector must do better,” the regulator stated bluntly. “Too many customers are being forced to navigate complex, inconsistent procedures at the worst possible time in their lives.”
In one case cited in the report, a woman attempting to gain access to her late husband’s account to pay urgent household bills was turned away repeatedly due to “missing documents” that had already been uploaded. In another, a carer was forced to visit a branch four times before their power of attorney was recognised.
The FCA has ordered financial firms to overhaul internal training, create streamlined bereavement pathways, and ensure staff can escalate sensitive cases when needed.
Key Findings at a Glance:
| Failure Type | % of Banks Affected |
|---|---|
| Staff lacked bereavement training | 78% |
| Digital processes blocked access | 61% |
| Duplicate document requests common | 52% |
| No clear escalation route offered | 45% |
| Customers left financially stranded | 34% |
In a sector that prides itself on customer experience, the numbers tell a very different story.
Stories Behind the Stats: “It Was Hell”
For Janine Rawlins, the breakdown wasn’t abstract. It was personal.
After her father passed away last year, she spent nearly two months trying to close his accounts and settle outstanding utility bills. Despite providing a death certificate and legal documents, she was asked to re-upload them “three or four times” via different portals, and on one occasion, her call was disconnected while being transferred to the probate team.
“It was hell,” Rawlins said. “You expect compassion. What you get is cold, robotic roadblocks.”
She’s not alone. Social media is now filled with similar testimonies—some even warning others to avoid certain banks altogether when dealing with bereavement.
Power of Attorney? More Like Powerless
The review didn’t limit itself to bereavement. Customers attempting to register powers of attorney—used to help elderly or incapacitated loved ones manage their finances—also faced a wall of confusion.
Firms often required “wet signatures” sent by post, despite digital systems being in place. Some insisted on forms that were no longer legally required. In several instances, bank staff were unaware that powers of attorney even existed.
The result? Financial paralysis for carers already stretched thin.
“We’re not asking banks to play therapist,” said Naomi Lawrence, head of consumer advocacy group TrustFamilies. “We’re asking them to follow their own guidance, treat people with dignity, and make it easier, not harder, to do the right thing.”
Industry Response: A Mixed Bag
UK Finance, the body that represents banks and financial services firms, responded with a cautious statement:
“We acknowledge the findings of the FCA’s review and are working with our members to ensure continuous improvement in how bereavement and power of attorney cases are handled.”
Some institutions have already begun rolling out changes. NatWest and Lloyds have introduced dedicated bereavement teams and simplified digital forms. Others, however, have yet to publicly address the FCA’s review.
The FCA has said it will “closely monitor” progress and warned of potential enforcement action if firms fail to implement improvements.
What Comes Next
As part of its Consumer Duty framework introduced last year, the FCA now requires all financial institutions to “deliver good outcomes” for retail customers, especially those in vulnerable situations.
This review is widely seen as a test case for how seriously firms are taking those obligations.
The FCA has given banks until July 2025 to demonstrate measurable improvements, including:
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Faster case handling for bereaved families
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Mandatory training modules for frontline staff
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Elimination of unnecessary document requests
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A centralised system for tracking legal authority (e.g., power of attorney)
Failure to meet the new standards could result in fines, public censure, or even licence reviews.
Bottom Line
Grief is already hard enough. For families navigating loss—or caring for a vulnerable loved one—banking should be a source of support, not another source of stress.
This review is a wake-up call for a sector that, for too long, has hidden behind policies when what’s needed is basic human understanding.
