Financial abuse prevention
Banking industry package helps to combat this silent crime
The Australian Bankers’ Association (ABA) has developed a package of materials to promote good practice and clearer processes for banks so they can better support customers who may be vulnerable to financial abuse or who want to plan ahead and manage their financial affairs, especially as they get older.
The banking industry is concerned about financial abuse and it wants to work together with interested groups to prevent this silent crime.
The ABA’s financial abuse package consists of:
- Industry guideline – Protecting vulnerable customers from potential financial abuse: As a framework to banks, this industry guideline explains what financial abuse can look like, how it can impact customers and the bank’s relationships with their customers, and how banks staffs can respond.
- Consumer fact sheet – Protecting yourself from financial abuse: This fact sheet is a plain English guide which provides information about financial abuse and outlines the steps customers can take to better protect themselves, their money and their property.
- Industry guideline – Responding to requests from a power of attorney or court-appointed administrator: This industry guideline explains how these different arrangements work legally across Australia, how they are used by bank customers and their substitute decision-makers, and provides a framework for how banks should respond to these arrangements.
- Consumer fact sheet – Setting up power of attorney to help manage your banking needs: This fact sheet covers what customers need to know in order to set up power of attorney arrangements to manage their banking needs and what they can expect from banks. Customers must weigh up the risks and benefits and make a decision based on what matters most to them, without pressure from anyone else because these arrangements can be misused.
- New tool to help detect financial abuse of Australians - Following a successful trial with major banks, Capacity Australia, with support from the Australian Bankers’ Association (ABA), has released a simple online education and assessment tool to help bank staff combat rising financial abuse of vulnerable people.
Financial abuse is a serious issue with far reaching consequences for individuals, their families and the community. It can happen to anyone, but some people may be at greater risk, including older Australians, people with a disability, people experiencing mental illness or emotional challenges, and people who are socially isolated.
Financial exploitation of a vulnerable person is a deeply challenging area for banks. Every customer’s situation is unique and banks have an obligation to protect their customers’ privacy, maintain the bank’s duty of confidentiality, and to not unnecessarily intrude into their customers’ lives. To intervene or question a customer inappropriately, or without due consideration and sensitivity, may cause embarrassment for the customer, or possibly damage the customer-banker relationship, or even result in greater vulnerability for the customer. Consequently, in cases of suspected financial abuse, it’s important to be both vigilant and cautious.
Issues can also arise when customers put in place power of attorney arrangements which determines how their money and property will be handled if something happens to them, or to manage a period away – such as, a holiday or a period of illness. Unfortunately these arrangements can also be misused. When a customer is no longer able to manage their own affairs, it is not unusual for a Court or Tribunal to appoint a substitute decision-maker, such as an administrator or guardian.