LLoyds wills blunder creates inheritance mess for hundreds of families

Hundreds of bereaved families could be forced to unravel estates wound up years ago after Lloyds Banking Group discovered a vast trove of old wills it could not match to customers.

Lloyds confirmed the massive storage blunder, revealed by the Financial Times, which has left it scrambling to reunite about 9,000 families with loved ones’ wills.

Families could belatedly find that sizable sums of money and other assets were handed to the wrong beneficiaries, and have to disentangle old bequests to ensure they are distributed correctly.

Wills blunder: Hundreds of bereaved families could be forced to unravel estates wound up years ago

Lloyds said the number of customers who suffered detriment was in the low hundreds. 

In 90 per cent of cases wills were superseded by a newer version, while in others copies of wills were held elsewhere, or had been settled through the intestacy process but in line with the deceased person’s wishes. 

The bank has promised those affected will be ‘fully compensated’, including covering any new legal costs, and that money and assets will not be clawed back from those who wrongly received them.

The wills were found among some 190,000 valuable papers stored by Lloyds’ ‘safe custody’ service, which was shut to new customers in 2011, according to the FT story by Nicholas Megaw.

It said Lloyds discovered it was holding envelopes which it could not match to customers, and has been working to sort this out since July. 

The bank has now centralised items and digitalised papers it still holds under the safe custody scheme, the story adds.

A Lloyds Banking Group spokesperson said: ‘Up until 2011, the bank offered a safe custody service where customers could store important items. 

‘In a small proportion of cases, it’s become clear that we did not trace a customer’s will when we were notified of their passing. 

‘We are investigating each case individually and where appropriate making contact with representative of these estates. 

‘We are deeply sorry for the distress and inconvenience this has caused and will ensure that those affected are fully compensated.’

Michael Culver, chairman of Solicitors for the Elderly, said: ‘Lloyds Bank failing to pass on the wills of 9,000 deceased customers, will no doubt have caused huge distress to the families involved. 

‘This processing failure is likely to have led to estates being wrongly distributed, contentious probate claims, negligence claims against executors and administrators, issues with tax payments and ultimately the last wishes of the deceased not being honoured.

‘I’d recommend that the families affected make a complaint to the Financial Ombudsman and make a counter claim against Lloyds directly. 

‘Solicitors specialise in making and storing wills, so it’s best to seek their support rather than using high street banks, and it’s always advisable to register a will.’

Emily Deane, technical counsel at the STEP trade body of inheritance professionals, says: ‘This is a disappointing and concerning story which raises an important issue. 

Did you store a will with Lloyds? 

Are you worried a late loved one’s will was left in Lloyds’ safekeeping, and their estate went to the wrong people? Contact [email protected].

‘We would advise people against storing a will in a bank safety deposit box because it will not be accessible to the executor until they get probate – and this cannot be granted without a will. 

‘If someone has an existing will stored in this way, we would recommend moving it elsewhere to ensure it is accessible and its whereabouts known to their executor(s) in the event of their death. 

‘Two options would be storage with a solicitor (if applicable) or with the Probate Service for a fee of £20.’

Dan Garrett, chief executive of will writing service Farewill, said: ‘The fact that a bank as reputable and as well-established as Lloyds can demonstrate such a poor handling of documents which can drastically impact the lives of thousands of grieving families is startling. 

‘Dealing with deaths has always been bottom on the list of priorities for banks, which can be really tough for the families left to pick up the pieces. 

‘There needs to be more focus and attention from the UK’s financial institutions who still handle thousands of the UK’s wills and estates, but there’s only so much that can be done in an industry which is still outdated and unnecessarily complex.’

Many banks have axed safe deposit services, although Metro Bank gives customers this option.

Lloyds offers safe deposit boxes via some branches, at a cost of £200, £325 or £475 a year depending on size. 

Jewellery, gold, house deeds and hard drives can be kept in them, but wills and cash are banned. 

 

 

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