Financial abuse of the elderly is on the rise as Australia’s population ages and dementia cases increase, with losses estimated to be in the millions. Queensland’s Elder Abuse Helpline has received a concerning 19.5% spike in calls in recent years, with losses of $56.7million sustained by just 139 victims who disclosed the magnitude of their loss.
People with dementia are increasingly vulnerable to financial abuse as dementia progresses, due to the gradual loss of ability and capacity to manage financial affairs.
Victims of financial abuse usually know the perpetrator, with research indicating that financial abuse of people with dementia is often perpetrated by family members and by people that they trust, such as neighbours and friends.
What is financial abuse?
The Australia Human Rights Commission defines financial abuse as “when a person you trust uses that relationship of trust to gain access to your money or property”. Financial abuse can include:
- Failure to repay loans to the older person;
- Living with the older person and refusing to contribute money for expenses;
- Forging or forcing an older person’s signature;
- Getting an older person to sign a will, contract or power of attorney through deception, coercion or force;
- Pressure to act as guarantor for a loan;
- Pressure to transfer or sell property;
- Pressure to give away money;
- Promising long-term care in exchange for money or property and then not providing the promised care
- Stealing from the older person;
- Misappropriation or misuse of money, property, assets;
- Coercing an older person to give away assets or gifts;
- Putting pressure on an older person to accept cheaper or lower-quality services to increase financial resources for beneficiaries upon the older person’s death;
- Misuse of powers of attorney, or
- Withholding funds from the older person or denying them access to funds.
Financial abuse can occur with other forms of abuse, such as physical abuse, sexual abuse, psychological abuse and neglect.
Protecting against financial abuse
The best way to safeguard yourself against financial abuse is to plan ahead, while you have capacity for decision making, by appointing someone to act as your attorney, through a financial Power of Attorney.
A Power of Attorney document gives your authorisation for an individual or individuals to act on your behalf when you no longer have the capacity to manage your financial affairs. You can prepare your Enduring Power of Attorney so it will only come into effect if you lose capacity for decision making.
If you decide to appoint two people you should be confident that they will not be in conflict about what is in your best interests. This person/s may not necessarily be an adult son or daughter.
The person/s you appoint as your attorney should be trustworthy, capable and financially literate. It is very important that you appoint someone who you trust will act in your best interests and who will not take advantage of their power.
Depending on the type of dementia and your personal circumstances, you may want to explore alternate options for banking and managing your financial affairs, particularly with increasing moves towards electronic transactions.
Some forms of financial abuse are criminal offences and in these instances you should contact your local police.
If you suspect someone will dementia is being financially abused, or you would like to talk to an experienced aged rights lawyer about protecting your financial assets should you lose decision making capacity, contact:
Aged Rights Lawyer
Phone: 07 4639 0357