Sue is describing the moment she discovered that her late mother, Margaret (not their real names), who'd spent the last years of her life battling dementia, had had more than £14,000 stolen through direct debit fraud.

"To be told that that amount of money had been taken... I was outraged that someone could steal off my mother," Sue says.

And she is not alone in her concern. The charity Action on Elder Abuse is warning about the dangers of direct debits being fraudulently set up in the name of vulnerable victims.

The charity says it's concerned about loopholes and a lack of transparency within the current system.

But the Direct Debit scheme says its guarantee means companies that use it to take payments directly from customers' bank accounts are carefully vetted.
'Legitimately' set up

After being diagnosed with dementia in 2010, Margaret moved into a nursing home.

Three years later, at a point when Margaret could no longer care for herself, two direct debits were set up using her bank account details.

Over the next four years more than £14,000 of Margaret's money was stolen to pay the direct debits and it was only after she died in 2017 that her daughter Sue discovered what had happened.

Sue began trying to find out what had happened but was told by her mother's bank, Lloyds, that it had carried out an investigation and it had concluded the direct debits had been "legitimately" set up so it would not be refunding any money.

Most of the money stolen from Margaret's account was used to pay Vodafone, but the company told Sue it was unable to help or provide any details of who was receiving its services because of "data protection" rules.

Sue also contacted her local police force. It referred her to Action Fraud which said it was unlikely any further action would be taken.
Sue described the reaction from her bank as "disgusting".

"The whole thing was taking over my life. I didn't know where to go for help, I couldn't sleep. All day long I was on the internet trying to find out who else I could go to for help but there was nothing."

"I wrote and explained that my mum couldn't have set up these direct debits.

"I explained she couldn't feed herself, she couldn't go to the bathroom on her own, she was monitored all the time.

"She didn't have the capacity in her mind to think about setting up a direct debit and nobody listened. It was like [I] was being ignored and I had the feeling that because my mum was dead they [Lloyds] couldn't care less."

Direct Debit offers a guarantee which explains that companies wishing to use it to take payments directly from people's bank accounts have to go through a careful vetting process.

A spokesperson for the Direct Debit scheme said: "The billers [companies] are required to carry out payer verification checks when a Direct Debit Instruction is set up - details of the verification checks used by billers cannot be shared for obvious reasons."

The safeguards supposedly in place to protect vulnerable people, as well as the loopholes in the system, is something that Veronica Gray from Action on Elder Abuse says need tackling.

"This particular case highlights a lack of transparency in how the system operates. This level of passing the buck when elderly or vulnerable people fall between the gaps is just not good enough.

"The Financial Abuse Code of Practice, which is a voluntary code but which many banks have signed up to, is very clear about how financial institutions should treat vulnerable customers. Clearly this has not been used in this case.

"[Bank] staff are struggling to know what signs to look for and clearly don't have the skills to and expertise to identify patterns of abuse when they see them."

When it was contacted by BBC Money Box, Lloyds started a new investigation which concluded that its initial response was wrong and it would be refunding all of Margaret's money, plus interest and £600 by way of compensation.

A Lloyds spokesperson said: "We were very sorry to hear of the difficulties experienced by Ms Lee when dealing with her late mother's account. It should have been clear when her daughter contacted us in 2017 - following her mother's death - that Ms Adams would not have been in a position to arrange these Direct Debits.

"We would like to apologise for the distress and inconvenience caused by our handling of this case and have now arranged for a full refund of all the payments."

Warning signs

Vodafone said in a statement that it was also looking again at the case and would be providing the details of an individual who may have used Margaret's account to the police.

It added there were a "wide range of security verification and fraud checks when opening a new account", but that people can subsequently change the direct debit details. It also said it would welcome any initiative that further strengthened the direct debit system.

Whilst Sue is grateful that Lloyds have decided to refund the money stolen from her mother's account she just wants to make sure this can't happen to someone else.

"I really would like someone to be accountable for doing this. You know, for the police or somebody to find out who did this - in case they're doing this to somebody else.

"Lloyds should have looked into the fact that this account had laid dormant for years and then all of a sudden this money is coming out of it - surely that would ring a bell, that something's wrong there?

"And once you say someone's in a home with dementia and these things have happened surely that should mean something?"