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Financial elder abuse is so distressing because it’s generally perpetrated by their nearest and dearest – a partner, children, relatives or friends. Photograph: Alan Porritt/AAP
Financial elder abuse is so distressing because it’s generally perpetrated by their nearest and dearest – a partner, children, relatives or friends. Photograph: Alan Porritt/AAP

Inheritance impatience: 'Our family has been wrecked by this experience'

This article is more than 5 years old

Those vulnerable to financial elder abuse are often let down by the legal system and people they should be able to trust most

  • This is part one of a series about aged care in Australia

When Anne* discovered that her older brother had spirited their elderly mother away, it was the dramatic climax of months of financial elder abuse that ended only with her mother’s death.

Talking about it on the phone from her home, she describes how her brother falsely claimed a carer’s allowance and other benefits before she became aware of the extent of the problem.

“I believe he had forged my mother’s signature and changed her will,” Anne says, explaining how she struggled through the courts and the New South Wales civil and administrative tribunal in the hope of protecting her mother and the mother’s assets.

Anne says that just before her brother took their mother back to her unit, she told Anne she was frightened of him.

“The police declined to intervene, saying it was a civil matter, and did not put an urgent intercept on his car. When I got the NCAT ruling, which determined that my mother still had the capacity to manage her own affairs, he had spent most of her money on gambling and alcohol. He then left her to die of neglect. The doctors told me she had not had her medication in over two weeks and was suffering from malnutrition,” Anne says, her voice breaking.

Susan* was faced with an equally horrifying situation, watching as her brother used their father’s gradual decline as an opportunity to chip away at the family’s farming assets.

“Unfortunately, my father had a business partnership with my brother,” she says. “Gradually I realised that my father was becoming demented and that the money was disappearing. My brother was living the high life, with TVs in every room for the kids, an in-ground pool and flash cars.

“I had power of attorney over my father’s affairs, together with my uncle. We sought legal advice and tried mediation, but my brother was having none of it.” Susan says she believes he was involved with drug trafficking. “I had to make several intervention orders and move away because of the risk of violence to myself because of his links to bikies.

“After my brother was arrested a couple of times, I called the elder abuse helpline and requested guardianship. The public advocate appointed an independent company to manage Dad’s affairs, but it took 12 months of me being at them for them to respond. They were over four and a half hours away in Melbourne. Even during guardianship, my brother managed to get his hands on $40,000 of Dad’s money. He was a sitting target.

“Two years of litigation against my brother cost thousands. Eventually the court decided that he had to pay my father’s legal costs. I got Dad into emergency respite and he now lives in care. But our family has been wrecked by this experience. The financial administrator now has a mortgage on the farm and my brother works on it.”

Financial elder abuse is one of the uglier consequences of rapidly shifting demographics. Photograph: John Stillwell/PA

Although there is insufficient hard data, according to statistics from Senior Rights Service, 5% of Australians will experience some form of financial elder abuse. Women are more likely to be victims of abuse by 250%, while two-thirds of cases are perpetrated by the adult children of the victims.

Whether it takes the form of exercising undue control, withholding or coercing, it is always traumatic and disempowering. What makes it so distressing is that it is generally perpetrated by those closest to the victim. In many ways, this makes it worse than the other increasingly common risk of being scammed by a total stranger thousands of miles away – impersonating a telco or computer technician, or via a dating site for seniors.

More common than physical harm, financial elder abuse is one of the uglier consequences of rapidly shifting demographics. Estate lawyer Donal Griffin from Legacy Law says he has seen an increase in cases that reflect societal disruption, as well as a rise in cases challenging wills.

“Baby boomers are the first generation who commonly remarried, often starting new families. This can lead to disputes over estates, prompting financial abuse,” Griffin says. “When a parent keeps changing their mind or moves their investments and it infuriates the beneficiaries, you have to ask yourself if there has been undue pressure or influence. Sometimes revenge can be brutal. I see more and more cases where a spouse has put their husband or wife into miserable care to reduce costs and save money, and the motives are unclear but very distressing for the family.”

Elder abuse campaigners Vicki Blackman and Maria Berry believe the system is letting people down. “Politicians are spending all this money on awareness campaigns, but they mostly just reach honest people which solves nothing. We need laws to change,” says Blackman.

Berry agrees: “It feels like this is a hidden epidemic, like domestic violence. One bit of advice I do give is to do an advanced care plan. And seek the help of a succession planner if you think there is going to be a dispute, and go to mediation or guardianship sooner.”

As parents live longer, children have to wait longer to benefit from any proceeds of the family estate they may be counting on to pay off a mortgage or take extended leave from work, leading to so-called inheritance impatience – a trait that can often prompt fraudulent appropriation. It often begins mildly, with the occasional misuse of a person’s pin number, before escalating into fraud.

One family who would only speak to the Guardian anonymously reported that their elderly mother, who lived alone on the NSW north coast, woke one day from a nap to find a distant long-lost relative by her bedside. While gaining her trust and affection, he prevented her children from speaking to her on the phone.

The tight-knit family became alarmed. Taking leave from work in Sydney, they set up a 24-hour roster to sit by her bedside, maintaining a constant vigil. At times this meant sitting across her bed from the man and duking it out in an unnerving, sleepless battle of wills. Their mother had drawn up a power of attorney, but was still sufficiently independent and lucid not to need anyone to act on her behalf. Now she hinted at changing her will. It took weeks for her sons to wear their cousin down. Eventually, sensing defeat, he disappeared as mysteriously as he had appeared.

The motives are complex. They include the baser, more venal aspect of human nature; the pressure of expectations, aspiration and gratification in a materialistic society; simple opportunism; and the increasingly digital, depersonalised world we live in. Governments, legal institutions, social services and banks are all grappling with the problem, with varying degrees of effectiveness.

Several nursing home managers who spoke to the Guardian confirmed that they see cases of children complaining about facilities as “a pretext to withdraw their parents from care to save money that they can then access”.

One social worker working with the NSW Public Guardian says he frequently observes instances of financial abuse “where the victim is either fully or partially aware of what is happening but decides it’s a trade-off for being able to stay in their home. We are powerless to interfere.”

Darryl Browne, the chair of the NSW Law Society’s working group on elder abuse, believes terminology matters: “To call it inheritance entitlement syndrome legitimises the behaviour. Better to call it theft.”

An accredited specialist in wills and estates, Browne believes an extension of the forfeiture rule would create an effective disincentive. “The rule says that if I kill someone, I can’t inherit from their estate. If we extend that to financial elder abuse, and we publicise it, I believe it would have a deterrent effect. Currently the rule applies in eight jurisdictions in the US.

“Another reform I believe we need is a public advocate. NSW is currently the only jurisdiction in Australia without one. If well-resourced and adequately embodied, it would be a useful way of reporting and investigating concerns in a way that was proactive rather than the reactive role of public guardianship.”

In South Australia, the new government has recently passed legislation, which is due to come into force in 2019, establishing an adult safeguarding unit. It is the first of its kind, created in direct response to issues identified as a result of the exposé on the state-government-run Oakden care facility. The South Australian minister for health and wellbeing, Stephen Wade, says the unit will “make it easier for the community to report suspected or actual cases of abuse or neglect of vulnerable adults and will be empowered to investigate issues”.

Currently, a petition by the Australian Banking Association is asking all states and territories to create a set of financial elder abuse safeguards that standardise powers-of-attorney legislation, which currently vary from state to state, as well as establish a national register for powers of attorney and set up a hotline for customers and bank staff to report suspected cases.

The banking industry is working to protect elderly people from financial abuse. Photograph: Dave Hunt/AAP

The ABA chief executive, Anna Bligh, says by the end of this year, the association will have revised guidelines about how to prevent financial abuse in place. “The challenges facing the sector on this issue are immense,” she says.

The 2016 guidelines, prepared with the financial ombudsman service, recognise that women are predominantly affected and recommend that banks need more specialised employees.

“Bank staff are at the frontline of the issue,” Bligh says. “Customer transactions are private and sensitive matters. We have done a lot of training to help staff identify red flags. At the same time, older Australians need to learn how best to protect themselves, even if they have no cognitive impairment. We suggest putting limits on transactions and requiring more than one co-signatory on any major withdrawal or transfer.”

The Commonwealth Bank recently launched the Safe and Savvy guide, intended to inform its senior clients (identified, soberingly, as anyone over 50) about what to be aware of and how to protect themselves. The bank has printed 50,000 copies of the guide to date and it is being translated into other languages.

The CBA’s customer advocate, Brendan French, put the information together following six months of consultation with ethicists and the aged care sector.

“One of the things that concerns me most from our research is that people with inclusion challenges are more readily [the] prey to this kind of abuse,” French says. “So if you live remotely or have a disability or limited financial literacy, that makes you more vulnerable. We need to identify the indicators, look at social cohesion and work closely with multicultural communities to create a safe space where people can talk to a trusted adviser in the bank without a sense of shame.”

Other recommendations include eliciting the support of personal doctors and accountants, keeping detailed written records and regularly reviewing any power-of-attorney arrangements. Safe and Savvy also offers tips such as temporarily locking credit cards, blocking ATM cash advances and setting a spending cap – all of which requires awareness and vigilance. But with mental health issues and gradual or sudden cognitive decline in the mix, things become infinitely more complicated.

The news is not all grim. One technology that could assist banking and legal representatives in providing up-to-date information on the validity of powers of attorney and financial transactions is blockchain. To date, the decentralised digital ledger has been primarily used by cryptocurrencies, but it has other applications and potential that could make it a lot harder to take advantage of vulnerable individuals. Secure, verifiable data may be the best protection we have against the darker side of human nature.

* Names have been changed

If you, or somebody you know needs help with advocacy regarding an aged care issue, you can contact the Older Person’s Advocacy Network (OPAN) on 1800 700 600 for free, independent advice.

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