Taking steps to stop abuse
Banks need to collaborate with government agencies
THROUGHOUT Australia older people are losing their savings, property and homes through financial abuse, usually at the hands of people close to them such as an adult child or grandchild.
A sense of entitlement, “inheritance impatience” or opportunism can encourage people to ‘help themselves’ to an older person’s assets.
Elder abuse is not a new problem.
It has been occurring for generations, but it is only now serious steps are being taken to address it.
The extent of elder abuse in Australia is unknown, but conservative estimates suggest at least nine per cent of older Australians suffer from financial abuse.
However, we know that because of the hidden nature of the problem, most cases go unreported.
Sadly, most older financial abuse occurs within families, and is defined as the illegal or improper use of a person’s finances or property by another person with whom they have a relationship implying trust.
On October 1 this year the Commonwealth Attorneygeneral announced a suite of measures to address elder abuse.
These will include initiating a peak body focused on elder abuse, an online knowledge hub, and education materials to better support older Australians.
But, as Michael Riley, chief executive officer of the elder advocacy group Greysafe, notes: “We know the problems, we now need an action plan and timelines put in place to come up with solutions”.
The opportunities for elder financial abuse are exacerbated by the depersonalisation of banking services.
An increase in electronic services means that older people are more vulnerable to such exploitation than in the past.
Although criminal law addresses matters such as theft and fraud, low conviction rates indicate the difficulty of bringing an elder abuse matter before a court.
Furthermore, many older people do not want to pursue relatives in criminal proceedings – despite the experience, they wish to maintain family relationships.
Part of the solution may rest with banks and financial institutions which are often at the front line when instances of elder financial abuse arise.
There has been some reluctance on the part of banks and financial institutions to address elder abuse citing concerns regarding privacy obligations, legal liability, and the absence of a consistent reporting framework.
To date, some bank staff receive training to deal with elder abuse detection and banks follow the industry guideline, Protecting Vulnerable Customers from Potential Financial Abuse.
In the absence of a broad national reporting framework, there is no cohesive strategy as to how to deal with the elder financial abuse.
Furthermore, there are no whistleblower protections for bank employees who may be exposed to legal action from families in the event that financial abuse is not proven.
This can make bank employees reluctant to report suspected abuse. To address this, the Australian Law Reform Commission recommended that the Code of Banking Practice should ensure that banks be obliged to take “reasonable steps” to prevent the financial abuse of vulnerable customers.
SHORT CHANGED: Elder financial abuse has the potential to devastate individuals at the most vulnerable point in their lives as well as have a detrimental impact on society as a whole.