Money

How to stop elder financial abuse at the hands of loved ones

'Inheritance impatience' is one of the drivers of elder financial abuse, writes Christine Long.

Feeling itchy to get your hands on your inheritance? You might want to be careful about where that thought leads.

"Inheritance impatience" is one of the drivers of elder financial abuse. At its ugliest it can see people cross the line into criminal behaviour.

Difficulty paying bills and social withdrawal can be signs that an older person is being abused financially.
Difficulty paying bills and social withdrawal can be signs that an older person is being abused financially. Photo: Riitta Supperi

Last week Wollongong man Toby Di Comun Williams was sentenced to at least a year in jail for using a power of attorney to fleece his father out of $157,000 of his life savings.

Di Comun Williams was appointed in January 2014 when his father, Shane Williams, was debilitated by anxiety, depression and alcoholism. The 27-year-old then opened new accounts and used credit cards in his father's name to make thousands of dollars of purchases, including a new car and expensive holidays.

Elder abuse is defined by any action that improperly uses an older person's assets. Illustration: Michael Mucci
Elder abuse is defined by any action that improperly uses an older person's assets. Illustration: Michael Mucci 

The court heard Shane Williams now lived with his brother because he was unable to financially support himself.

In another case, Queenslander Sharon Young was charged in October last year with the fraudulent use of a $200,000 trust established for her 80-year-old mother.

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The 55-year-old allegedly sold a property belonging to her mother and used the proceeds to pay off her own personal debts and buy properties for herself in Western Australia and Queensland.

It's also alleged she placed her mother in a nursing home with no financial support for accommodation, living and medical expenses.

Elderly people are often reluctant to speak up about abuse by family members.
Elderly people are often reluctant to speak up about abuse by family members. Photo: Alejandro Moreno de Carlos

Terry Lawrence, Acting Detective Superintendent, Queensland Police Service Fraud and Cyber Crime Group, said Young's actions constituted "elder abuse".

The Fraud and Cyber Crime Group was contacted by the Adult Guardian and Public Trustee, which had been alerted to the situation by Centrelink.

The case is listed for a committal mention in the Pine Rivers Magistrates Court this week.

Elder abuse is any behaviour or action within a relationship of trust that harms an older person. It includes financial, psychological, physical, sexual, social abuse and neglect.

Once the money is gone it's very hard to get back.

Rob Critchlow, NSW Police Detective Superintendent

Elder financial abuse in particular is the illegal or improper use of an older person's property, finances and other assets without their informed consent or where consent is obtained it is by fraud, manipulation or duress.

The World Health Organisation estimates that one in 10 older people experience abuse each month, with financial abuse prevalence rates estimated at 1 to 9.2 per cent.

Australia has no national data on elder abuse. But it's an issue that is garnering increasing attention as the population ages and house price growth and rising superannuation savings are creating the wealthiest generations ever to retire.

It is currently the subject of a NSW Upper House inquiry and was scrutinised by Victoria's Royal Commission into Family Violence last year.

The Financial Services Council convened a round-table discussion on the issue late last year and in January the Queensland government promised to direct more than $18 million into combating the issue.

This week the fourth National Elder Abuse Conference is being held in Melbourne.

Analysis by the National Ageing Research Institute of Seniors Rights Victoria's helpline data sheds some light on elder abuse. Of those reporting abuse in the two years to June 30, 2014, 61 per cent reported financial abuse and 59 per cent psychological or emotional abuse.

Often the two go hand-in-hand. Mary Ciantar from the NSW Elder Abuse Helpline and Resource Unit observes: "If someone is coercing a person to sign documents or threatening to place them in residential care, withholding affection and isolating an older person from their family, friends and activities – that [psychological] abuse allows the [financial] abuse to occur."

Victims are mostly women (72.5 per cent) and perpetrators male (60 per cent).

Almost all alleged perpetrators (92.3 per cent) were related to the older person, with two out of three their son or daughter.

Perpetrators are often middle-aged. Calls to Queensland's Elder Abuse Prevention Unit in the five years to June 30 2015, found about 40 per cent of the perpetrators were aged between 40 and 54 years.

And the amounts involved can be substantial. In 2013-14, the Elder Abuse Prevention Unit found a total of $56.7 million was misappropriated from 139 elder abuse victims.

It comes in different guises: pension-skimming; using the older person's bank account or credit card without their consent; denying them access to their money or bank statements.

It can involve a loan that is never paid back or the misuse of a power of attorney. Someone may be coerced into changing their will or other legal documents.

The "assets for care" exchange is often at the heart of it. As Age and Disability Discrimination Commissioner Susan Ryan observed at the Financial Services Council round-table, an older person may be persuaded to transfer their home to a child on the understanding that a granny flat and care will be provided.

"When the handover happens and the elderly parent is left destitute little can be done typically because there was no proper legal agreement in place," Ryan says. "Typically, the older person did not seek independent legal or financial advice."

Jenny Blakey, a manager at Seniors Rights Victoria, says adult children are most likely to become abusive if they themselves are struggling with mental illness, gambling or addiction issues, potential business failure or other financial problems.

As she told the Victorian Royal Commission into Family Violence, in the most extreme examples older people sign over their house or go guarantor on a loan, sometimes without realising what they have been asked to sign.

"This is particularly an issue when people come from a culturally and linguistically diverse background," she said.

"They may rely on adult children to translate and conduct affairs for them and if they are asked to sign something, they will.

"Then suddenly later they find that the house is not theirs; it is mortgaged to the hilt for some other reason; there's been no repayments; and they have to leave."

NSW Police Detective Superintendent Rob Critchlow says older people who are isolated or dependent on others – perhaps as a result of dementia – are among those most at risk.

Even those with full capacity may think of the situation as "family difficulties" rather than abuse, says Blakey, adding they may wrestle with the implications of speaking up.

It's a situation that makes it vital for other family members – as well as friends, neighbours, community carers and lawyers or financial services professionals – to be aware of the warning signs.

Red flags include difficulty paying bills; unexplained disappearances of possessions; significant bank withdrawals or unusual activity on their credit card or bank statement; or changes to a will. Missing items such as medications or hearing aids can be cause for concern. So can a change in demeanour and attitude.

Social withdrawal can be another indicator. If someone is doing something untoward they may try to isolate the older person. Or they may dominate a meeting with a financial planner or accountant, not allowing the older person to speak. "Beware the hovering carer," warns Critchlow, advising financial professionals to get their instructions from the person who will bear the loss.

"Once the money is gone it's very hard to get back," says Critchlow, adding that the ripple effect of someone being defrauded later in life is significant. "It means you probably lose your home; you lose access to medical support; you may even lose access to your community … which you rely upon for your wellbeing."

Preventing elder financial abuse

Prevention and early intervention can protect older people from devastating losses.

Jenny Blakey, a manager at Seniors Rights Victoria, advises people to think carefully before entering into arrangements that involve a loan or a transfer of money or property in exchange for care.

Seek independent advice and put in place a family agreement, or at least document it, she says.

Consider whether you can claim a property interest or be compensated later for what you contribute; how it will affect your pension and tax; and the effect a granny flat investment will have if you move into aged care later on. Make it clear whether it is a gift or a loan.

A power of attorney can provide protection if a person loses capacity to manage their own financial affairs. It can include limits such as withholding the power to sell your home. You can also give powers of attorney to more than one person and either give them the power to act separately or require decisions to be made jointly. Ensure that the people appointed has the financial capacity and the time to manage your affairs.

For further information, see Seniors Rights Victoria's booklet Care for Your Assets: Money, Ageing and Family or Queensland University's fact sheet Minding the Money. Each state and territory has an elder abuse helpline where people can raise issues, seek advice and obtain referrals.

How one family dealt with a tough situation

"I don't think at any point my sister maliciously planned to hurt Mum. It was the circumstances that she was going through in her life which was very stressful and she lost control of her own behaviour."

That is the way Susan* describes a situation that unfolded in her family when her mother was in the early stages of dementia and her sister, Diana*, moved into her mother's house to care for her. At the time Diana was going through a relationship breakdown.

They agreed to add an extra bedroom to the back of the house for Diana.

"It ended up being the reverse," says Susan. "Diana moved into the front of the house and Mum was out the back of the house."

Susan describes her late mother as "very outgoing", "caring" and "friendly", so she was very concerned when her mother seemed both frightened to go home and very anxious about doing something that might make Diana angry. One night her mother broke down in tears at Susan's place.

Shortly afterwards, several other people – from her mother's church, relatives and a hospital social worker – contacted Susan to express their concerns about her mother's wellbeing.

One person had witnessed Diana shouting aggressively at her mother. Another had heard similar verbal abuse. The possibility of elder abuse was mentioned.

Susan and a concerned neighbour met with Diana and their mother to discuss the situation. Diana agreed to move out of the house. Relatives took over joint management of Susan's mother's financial affairs via powers of attorney. Her house was sold and she moved into supported accommodation.

It was then that about $40,000 of unexplained expenditure was uncovered.

"As my relatives were tidying up my Mum's financial affairs they said there's tens of thousands of dollars missing here; we don't know where it's been spent," Susan recalls.

With the difficult living situation resolved, the family decided not to pursue the money and possibly get Diana in legal trouble.

What happened still has ramifications, as Susan no longer has a relationship with her sister. With hindsight she says if she'd had "any inkling" how things would turn out she wouldn't have let her sister move into their mother's house.

* Names have been changed.

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