Elder financial abuse

Elder financial abuse normally refers to a purposeful breach in trust that causes financial harm to an older person.

Elder financial abuse is specifically the illegal or improper use of an older person’s property, finances, and other assets without their informed consent/understanding or where consent is obtained by fraud, manipulation or duress.

Financial abuse is more common than you might think, with thousands of cases occurring across Australia every year. It affects people of all cultural, financial and social backgrounds. Here are some resources and information on how to help avoid this situation yourself or protect a loved one.

Financial abuse can take many forms, and usually consists of purposeful actions over a period of time, rather than a single event.

Cases can include instances of pension-skimming, using a bank account or credit card without consent, or denying the older person access to their money or bank statements. It might involve a loan never being paid back or the misuse of a power of attorney or general authority. Someone may be duped into changing their Will or signing another type of legal document. Persuasion or threats might also be used. One example is persuading an elderly person to transfer their home to an adult child on the promise that a granny flat and ongoing quality care will be provided.

Whatever guise it takes, “inheritance impatience” can often be one of the main drivers of elder financial abuse and can leave an elderly parent destitute. Beyond financial loss, it can also limit a person’s access to a safe home, adequate food, or medical care. Other serious impacts include anxiety, stress and depression.

Elder financial abuse can happen when someone feels entitled to an elderly person’s money.

This can be a child, carer, relative, Power of Attorney, professional with privileges or trusted individual who may: 

• Make transfers to their own personal account.
• Make charges to the elderly person’s credit card or accounts without permission.
• Emotionally blackmail or demand monetary loans or gifts.
• Forcefully have them sign a new Will or appoint them as the Power of Attorney or Enduring Power of Attorney.
• Threaten neglect if the elder doesn’t do what they want.
• Make an elderly person feel they have no choices or are incapable of making their own decisions.
• Cause physical harm or excessive anxiety.   

The other common form of elder financial abuse is scams. Read about how to protect yourself from scams.

A ‘financial abuser’ can be someone you hardly know or someone you have known all your life. They could be family members, friends, acquaintances, a neighbour or stranger who befriends you. They may also be professionals or caregivers employed to help you.

Perpetrators of elder abuse are typically the very people you may trust the most. Adult children have been found to be most likely to become abusive if they are struggling with their own mental illness, gambling or addiction issues, potential business failure or other financial problems.

Older people who are isolated or dependent on others – particularly due to cognitive decline / dementia – are regarded as most at risk of elder abuse. Even those with full capacity can easily dismiss their situation as being a “family difficulty” rather than seeing it for the abuse it is, preferring not to involve authorities out of a sense of family duty.

That is why it often falls to other family members, friends, neighbours, and carers to be on the lookout for the warning signs.

Red flags can include problems with paying bills, valuable possessions suddenly missing without explanation, significant bank withdrawals or unusual credit card or bank statement activity, and changes to a Will or Power of Attorney. Having items like medications or hearing aids go missing should also be a concern, along with a change in a person’s demeanour or attitude. Social withdrawal can occur where an abuser actively isolates the older person to reduce the risk of them speaking up. Perhaps they dominate a meeting with a financial planner, lawyer or accountant to limit the older person’s opportunity to say something.

Warning signs

Some other signs that elder financial abuse could be happening to you or somebody you know are:

• The appointed Power of Attorney not following directions or acting in the interest of the individual to whom they provide care. Recent changes to guardianship or Power of Attorney documents may also be a problem.
• Forged signatures on cheques, bank accounts or legal documents.
• Unpaid bills, despite assigning that responsibility to a trusted person.
• An absence of mail, particularly delayed or missing bank statements.
• Stolen or unpermitted seizure of assets, property or possessions.
• The elder expressing feelings of guilt and obligation if the individual withholds financial assistance.
• Irregular and unusual spending patterns on the victim’s account.
• Large, unexplained transactions or transfers to family/third parties.
• Limited ability or means to prove that financial abuse is occurring.
• The individual lacking awareness of their financial situation.

Protect yourself from financial abuse

• Talk about financial matters with trusted family and friends. Set up the right support networks and have all the correct documentation in place to protect your financial future.
• Keep track of your finances by checking your bank statements regularly to make sure there have been no unauthorised transactions. Talk to your bank if you find any surprises. Consider asking your bank to guide you through setting up Online Banking or their banking app, so you can bank easily from home. You can also get them to assist you with notifications that appear in your email or via SMS. They can also help you put limits in place for transfer amounts or make your account ‘view only’.
• Open your own mail.
• Stay in touch with the people you trust and care about.
• If you lend money to someone, set up a repayment plan, record the signed terms of the loan which should include a repayment plan.
• Never sign a document or make a big financial decision unless you understand the terms and what your obligations are and if you’re unsure, seek professional advice.
• Ensure you never share your banking log in details, passwords, security codes, or PINs with anyone even if they claim to be from the bank, or a close friend/family member.
• Ensure you have an up-to-date Power of Attorney and send certified copies of important documents to a trusted person. Some organisations or solicitors can keep copies of these documents in your name.

Build a support network

To protect your financial future, it’s a good idea to set up your own support networks, appoint appropriate third-party representatives and have all the correct documentation in place. This could include establishing a Power of Attorney, third party authorisations and ensuring you have an up-to-date Will.

This network needs a contingency plan for support, should something not go as intended.

It’s important you trust your support network, they have the right values and capabilities to help you and there are no conflicts of interest. It’s good to have more than one person in your network.

People you could consider are:

• Bank Staff
• Legal Advisors such as solicitors and lawyers
• Family and Friends
• Medical advisors/experts
• Accountants
• Financial Advisors

How you can help a loved one

As a carer, supporter or relative of someone experiencing vulnerability, there are steps you can take to help protect them from financial abuse.

You should:

• Look out for warning signs.
• Help set up support networks that include independent people without conflicting interests in assets, who are reputable and accredited. This network can also include medical professionals.
• Report instances of abuse, fraud and scams to the bank and or relevant government departments.
• If you are appointed under a Power of Attorney, ensure you understand your own obligations and duty of care in managing the affairs of others.

We are here to help you. If you suspect you may be a victim of financial abuse, please have a confidential conversation with one of our friendly staff members either by calling 1300 131 844 or visiting your local branch.

Depending on your personal circumstances, we may:

• Hold or delay specific transactions within your accounts while we investigate.
• Based on the information available to us, confirm any person acting on your behalf has appropriate authorisation.
• Assist you to change your Online Banking details and PINs if applicable.
• Assist you to change your mail address for any mail we may send you, including a new card.
• With your permission, report the incident to relevant authorities.

1800 ELDERHelp 1800 353 374
A national free phone call providing information and advice on elder abuse. 

Adult Safeguarding Unit 1800 372 310
A contact if you suspect you or someone you know is being mistreated or abused.

Aged Rights Advocacy Service 08 8232 5377
The Aged Rights Advocacy Service (ARAS) offers a free, confidential and state-wide service to older people

Elder Abuse Phone line 1800 372 310

Be Connected
Be Connected is an Australia wide initiative empowering all Australians to thrive in a digital world. 

Council on the Ageing
COTA Australia’s role is to promote, improve and protect the wellbeing of older people in Australia as citizens and consumers. 

Elder Abuse Action Australia
A specialist organisation acting to eliminate elder abuse.

Read Stop Elder Abuse on the SA Health website.