Supporting elderly clients through Anti Money Laundering checks in a digital world
For legal and conveyancing matters the legal position is clear. Anti Money Laundering checks still apply regardless of age. The Money Laundering Regulations require firms to identify and verify clients, to understand the purpose and intended nature of the work, and to scrutinise transactions when necessary by looking at the source of funds. Sector guidance for lawyers also makes clear that understanding both source of funds and, where appropriate, the client’s wider source of wealth, must be done in a way that is proportionate to risk.
At the same time, the rapid move to digital onboarding has created friction for some older clients. Independent research finds that age remains the strongest driver of digital capability, and that although most people in their sixties and seventies are now online, confidence and key skills can lag. Older adults are also more likely to say that online banking feels too complicated or insecure, and they are more likely to prefer in person or telephone channels. These are reasonable concerns, not resistance. They reflect lived experience, security awareness and different comfort levels with technology.
Fraud risk also shapes these reactions. The latest industry figures record more than one billion pounds of losses to scams and unauthorised fraud in a single year, and charities report ongoing worries about scams that target older people. Caution about linking bank accounts or sharing data is therefore understandable and needs to be handled with patience and clarity.
Where onboarding friction usually appears, and how to ease it
Elderly clients tell us the most confusing parts of digital onboarding are understanding what counts as source of funds, knowing which documents can prove address, and deciding whether it is safe to connect a bank account through an online service. Those concerns are consistent with national evidence showing that a significant share of older adults avoid online or mobile banking due to perceived complexity or security risks. If you see hesitation at these points, assume it is a sensible safety reflex rather than a refusal to cooperate. Slow down, explain why the step is needed, and offer an alternative route where possible.
A simple way to reduce friction is to give examples in plain English. For source of funds, explain that acceptable evidence could include pension letters, a paper statement showing long term savings, or documents that show proceeds from a property sale. For proof of address, confirm that recent council tax, utility bills or official government letters are fine. If a client is uneasy about connecting a bank account online, offer a non digital route such as a branch printed statement or a secure document scan taken in the office. That blend of options matches research suggesting that older people benefit from face to face help and clear, step by step support.
Practical guidance when a client lives in a care home
First, check that the client is able to take part in decisions and understands the purpose of Anti Money Laundering checks. The Mental Capacity Act and its Code of Practice are clear that capacity is decision specific and time specific, and that you must not assume incapacity because of age or diagnosis. If you are unsure, arrange a calm conversation in a private room, avoid jargon, and consider a short written explanation in large, clear text. If doubt remains, seek a medical view in line with the Code and keep a note of your reasoning.
Second, adapt the verification method. Many care home residents do not have reliable access to personal devices. Offer in person verification, take secure copies of identification using your own equipment, and ask the care home for a letter on headed paper to support the address record where appropriate. Ensure the conversation happens in private and be alert to coaching or undue influence in shared spaces. The Law Society’s guidance on meeting the needs of vulnerable clients supports this approach and stresses the importance of communication adjustments and privacy.
Third, confirm authority where an attorney or deputy is involved. Ask for the original or a certified copy of the Lasting Power of Attorney or the court order. You can check the Office of the Public Guardian registers when you need to verify that an attorney or deputy has been appointed. Keep copies and record how you satisfied yourself that instructions are valid.
Practical guidance when a client has medical or cognitive difficulties
Begin with support, not assumptions. Many medical conditions do not affect the ability to instruct a lawyer. Offer shorter meetings, allow breaks, speak slowly and provide written summaries. If the client asks to involve a relative or carer, agree a structure that includes time alone with the client so that you can confirm understanding and consent. If capacity is uncertain, follow the Mental Capacity Act Code of Practice and consider whether a brief confirmation from a clinician would help. Record your analysis in a clear file note.
If the client cannot engage with a mobile app, use an office based process. Take a secure photograph of identification, accept paper statements, and certify copies in line with your firm’s procedures. These practical steps align with legal sector guidance that expects you to meet customers where they are, while still meeting the core verification duty.
If the client mentions memory loss or a dementia diagnosis, take extra care with explanations and pace. National data indicate that many people in later life live with dementia or cognitive impairment, and diagnosis rates have risen. That does not automatically change how you complete Anti Money Laundering checks, but it does mean you should plan for clear communication, private conversations and careful notes of consent and understanding.
Practical guidance where there is little or no family support
Some elderly clients have few relatives able to help. Offer in person appointments and telephone support. With the client’s permission, you can liaise with care home administrators to obtain address confirmation. If the client struggles to gather documents, consider supervised document collection during a visit and use your firm’s secure scanning to avoid reliance on the client’s device. These steps are consistent with Law Society guidance on working with clients who may lack capacity and on meeting the needs of vulnerable clients.
Source of funds and source of wealth, and when you can take a proportionate view
The Legal Sector Affinity Group guidance says you should have procedures to understand the client’s source of funds and, where relevant for the matter risk, the client’s wider source of wealth, with the level of evidence matching the risk profile of the client and the work. The Law Society explains the distinction, and the Regulations set out when scrutiny of source of funds is required as part of ongoing monitoring. In other words, you do not apply the same depth of enquiry in every case. You scale it according to risk.
A lighter touch is usually reasonable when funds come from long standing and predictable sources such as a State Pension, an occupational pension, long held savings or the proceeds of a property owned for many years, and when the value and pattern of the transaction is clearly consistent with the client’s circumstances. In such cases, a pension letter and a short run of paper statements may be enough evidence. This remains consistent with the simplified due diligence concept in government guidance, provided your firm level and matter level risk assessments indicate low risk. Keep a short note explaining why you considered the risk low and why the evidence was sufficient for this client and this matter.
By contrast, you should ask for deeper source of wealth evidence when large or unusual sums are involved, when the client cannot clearly explain the origin of their money, when there are signs of pressure from a third party, or when funds move in ways that do not fit the client’s known financial picture. Some supervisors publish stricter expectations. For example, the Council for Licensed Conveyancers has advised its regulated firms to obtain source of wealth alongside source of funds in every matter, which underscores the importance of knowing your own supervisor’s rules. Whatever your regulator, record the rationale for the depth of checks you chose.
It is also worth noting that the JMLSG guidance for regulated financial firms and the SRA’s own materials both emphasise the risk based approach. The principle is the same for law firms even though the detailed rules differ. Your task is to identify the real risk in front of you and calibrate the checks. Document what you did and why.
A short word on scams, safety and trust
Older clients are right to ask questions about security. Industry data show that criminals continue to defraud UK customers on a very large scale, and older adults consistently report concerns about the safety and complexity of online banking. Treat those concerns as a safeguarding signal, not an obstacle. Offer telephone or face to face alternatives, explain how you protect data, and reassure clients that there is always a non digital route if they prefer it.
Working Example
Below is a fully rewritten, paragraph-style example where the donor is too far away for an in-person meeting, and the gift is £90,000. The scenario is handled using a practical, proportionate, and legally compliant AML approach for an elderly client living in a care home.
Worked Example: Elderly Donor, £90,000 Gift, No Face-to-Face Meeting Possible
Mrs A is ninety years old, lives in a residential care home several hours away, and has full mental capacity. Her family live in other regions of the country and cannot assist with administrative tasks. She wishes to make a £90,000 gift to her granddaughter to help with the purchase of a first home. The family explain that travel is impossible due to the distance and her frailty, and they express concern that she cannot cope with detailed source of funds or source of wealth checks. Mrs A herself explains confidently, during a telephone or video call, that the money originates from savings built up over many years, originally derived from funds left to her by her late husband.
When a face-to-face meeting is not possible, the first priority is still to communicate directly with the client. A scheduled video call is ideal, but if Mrs A struggles with video technology, a telephone call supported by a care home staff member is acceptable. During the call, you confirm that Mrs A understands she is giving £90,000, that the money is for her granddaughter’s house purchase, and that she knows she will not retain the funds once the gift is made. Her answers demonstrate that she has full capacity and is making the decision freely. A clear record of this conversation is essential and serves as evidence that she is capable of providing instructions.
Identification must then be carried out in a way that respects her limitations but still meets regulatory standards. Since travel is not possible, you request copies of her passport or driving licence. Care home staff can assist by taking photographs or scans using the home’s equipment or a secure app if available. To verify her address, you can request a written letter from the care home on headed paper confirming her residency. These steps are compliant with AML regulations and recognised as reasonable adjustments where clients cannot attend in person.
The next task involves handling the source of funds and source of wealth checks. Because the gift is substantial, a simple verbal explanation is not sufficient. However, the guidance allows for proportionality, taking into account the client’s age, vulnerability and the logistical barriers. Mrs A’s explanation is consistent with what would be expected of someone in her circumstances: savings accumulated over her lifetime and money inherited many years ago. You therefore request limited but meaningful evidence that supports her account, such as recent paper bank statements. Care home staff can assist her with locating these documents or can help her request printed statements from the bank if she no longer receives them automatically.
Once you receive the statements, you check that the £90,000 sits in an account that has been in her name for a long period and that the movement of funds appears stable and logical for an elderly person living in a care home. If the balance has been consistent or reflects savings from earlier life, this strongly supports her explanation. You do not need to trace funds back decades, but you must be satisfied that the money is genuinely hers, legitimately obtained and consistent with her profile.
Throughout the process, it is important to remain alert to potential undue influence. The family’s comment that Mrs A is “too frail” to comply may simply reflect concern, but you must ensure they are not directing or controlling the decision. Your private conversation with Mrs A, even by telephone, confirms that she is acting of her own free will. The fact that she can articulate her wishes independently is key.
Once these steps are completed, you make a detailed file note explaining how you verified identity remotely, how you confirmed capacity, what evidence you obtained for source of funds and source of wealth, and why these steps were proportionate given that the donor is elderly, physically frail, and geographically distant. You note that the transaction is consistent with her financial background and that there were no indicators of risk.
With these measures in place, the £90,000 gift can be completed safely and compliantly, without placing unnecessary strain on a vulnerable but capable client. This approach blends regulatory requirements with compassion, practicality and a realistic understanding of the needs of elderly donors who cannot attend in person.
Bringing it all together
The ageing of the population means more older clients will be buying and selling property, managing estates, making gifts and donations, and seeking advice. The legal duties around Anti Money Laundering do not change with age, but the way we carry them out should reflect evidence about how people actually live, bank and communicate. National research shows that older adults are active but often cautious about digital tools and more comfortable with human contact. That calls for processes which remain safe and robust, but which also give practical alternatives, clear explanations and patient support.
When a client lives in a care home, has medical difficulties, or has limited family support, begin with dignity and clarity, check capacity carefully, verify authority when an attorney or deputy is involved, and adapt the method of verification to the person in front of you. When assessing source of wealth, use a risk based approach anchored in your regulator’s rules, take a proportionate view where the risk is low and the picture is clear, and escalate the depth of enquiry when the risk is higher. Doing these things protects clients and professionals alike and builds the trust that older clients look for when they come to you for help.
Sources referred to in this article
- Office for National Statistics and Department for Work and Pensions materials on older workers and employment trends. (Office for National Statistics)
- Centre for Ageing Better analysis on work in later life. (ageing-better.org.uk)
- Money Laundering Regulations 2017, Regulation 28 and HMRC guidance on simplified due diligence and ongoing monitoring. (Legislation.gov.uk)
- Legal Sector Affinity Group and Law Society guidance on source of funds and source of wealth for the legal sector. (Solicitors Regulation Authority)
- Council for Licensed Conveyancers compliance note on source of funds and source of wealth expectations. (clc-uk.org)
- Lloyds Bank Consumer Digital Index 2024 and FCA Financial Lives 2022, for evidence on digital capability, channel preference and security concerns. (Lloyds Banking Group)
- UK Finance Annual Fraud Report 2024 and Age UK programme research on scams affecting older people. (UK Finance)
- Mental Capacity Act 2005 Code of Practice and Law Society guidance for vulnerable clients. (GOV.UK)
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