Financial abuse is a serious and far reaching problem that can happen to anyone, but some people, like the elderly, people with a disability or other vulnerable and isolated people are at greater risk.
Increased house prices and reasonable superannuation balances can mean that some older people are in a good financial position. This can lead to family members feeling a sense of entitlement, with some people referring to it as inheritance impatience.
Exact elder financial abuse numbers are difficult to come by – but numbers will increase as population ages, by 2055 Australia’s population is expected to grow to 40 million, around 25% of them will be over the age of 65.
Sign the petition - You can help make a real change
Sign this petition to contact your relevant State/Territory Attorney-General, and the Federal Attorney-General, asking for them to introduce three key changes to help better recognise, report and stamp out elder financial abuse.
Bank staff on the frontline
Bank staff often see first-hand elder financial abuse, but they need to be vigilant and cautious when faced with a possible case of financial abuse. 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.
Banks will continue to offer ongoing training to frontline staff to help them identify and assist customers in difficult and sensitive situations.
Australia’s banks will work with governments and other key stakeholders to help ensure that all of the necessary measures, legislation and training are put in place to help protect older Australian’s from being abused financially.
Challenges for bank staff and the solutions
There is no one place for bank staff to report suspected cases - Australia needs an appropriate designated organisation where staff can report the suspected elder financial abuse for investigation.
It’s difficult to assess customer competency.
Power of attorney legislation is inconsistent across the country, which makes it complicated to detect and report abuse. Banks are calling on Government’s to introduced standardised legislation across the country.
To help check the legitimacy of a power of attorney banks want a national power of attorney register to be established. This would help all financial institutions verify the authority of a power of attorney or court-appointed administrator when they present themselves as acting on behalf of a customer.
Protecting yourself from financial abuse
Always protect your bank and financial cards, cheque books and other important documents. Never hand over a PIN or password to anyone.
If someone asks for money, discuss it trusted family member or friend before agreeing.
Get your affairs in order. Talk to your bank about setting up direct debits and pre-authorised bill payments. Consider who has third party authorisations over your accounts and ensure that they trusted.
Keep a track of your bank accounts, investments and other assets.
Put in place arrangements, like a power of attorney, for how your money and property will be handled if you can no longer communicate your wishes effectively.
Always read contracts and other documents carefully and never sign anything under duress, seek legal advice when in doubt or contact police if you think you are being abused.
Common types of elder financial abuse
Abusing power of attorney - Abuse can occur if someone with attorney power uses it to take a person’s assets for themselves.
Pressure, threats and intimidation - This occurs when someone attempts to force an older person to sign over ownership of assets, or make them a beneficiary of their will.
Fraud and scams - When a third-party deliberately sets out to falsely gain a person’s trust in order to defraud them and secure an unlawful gain.
Abusing family agreements - Often families enter into informal agreements that are designed to help everyone, but have no legal backing (eg. older parents sell their home and split the profit with adult children). These agreements can unintentionally create various risks of abuse.
Improper use of funds - when someone who lawfully has access to an older person’s money uses it for their own advantage.
Theft - Older people are particularly at risk, especially where they have care needs. Thieves can exploit an older person’s specific physical or mental vulnerabilities.
Inheritance impatience - When adults feel entitled to their aging relatives’ assets. This could cause them to try and take their assets from them, such as by stealing money from their bank accounts, or transferring parents’ assets into their name.
Guarantors gone wrong - Often older parents will help their adult children purchase a home or start a business by becoming a guarantor to a loan. It can lead to instances where the older parents lose their home, despite there being no bad intent.
Failure to provide promised care - This occurs when an (often well-intentioned) arrangement for family members to provide care to older relatives in exchange for financial assistance breaks down.
Emotional blackmail - This can be one of the least visible forms of abuse, such as an adult child refusing access to grandchildren except in return for a loan or an emotionally-dependant adult child abusing their parents by demanding money.
It’s estimated that up to one in ten Australians will be affected by elder abuse each year.
Exact numbers are hard to come by as it often goes unreported.
The most common form of elder abuse is financial.
Abuse can often cost victims their life savings.
By 2050 those over 65 will make up around 25% of the population.
Professor John McCallum – CEO & Director of Research, National Seniors Australia
‘Exact numbers are difficult to come by as elder financial abuse happens within private homes, often going unreported because of embarrassment or unpleasant family dynamics.’
Lewis Kaplan – CEO, Older Persons Advocacy Network (OPAN)
‘Elder financial abuse is a national crisis that needs a national solution.’
Nathan Rees – National Assistant Secretary, Finance Sector Union
‘Our members are frontline bank workers right across the nation. We are committed to protecting Australian seniors from financial abuse and exploitation.’
Ian Yates AM – Chief Executive, COTA Australia
'The situation as it stands is completely unacceptable and we need to do much more to actively prevent financial abuse of older Australians from occurring.'
Open Banking will allow customers, at their request, to share their personal information with other financial institutions to allow them to find a better deal on expenses such as electricity bills, telecommunications and other items.