What to do if you suspect financial elder abuse

There is no doubt the current lockdowns have increased financial stress on individuals, families and businesses. Uncertainty about how to make ends meet is fast becoming a common narrative across Australia.

One horrendous fallout, which often goes unnoticed, is children exploiting their parents financially. Common examples are where older people may be forced to hand over money or property to help their children, but as a result are left short and unable to pay their own bills. This exploitation is also seen with people living in residential aged care, particularly those who have lost the capacity to make their own financial decisions. 

In Australia, we are unable to accurately quantify or track the prevalence of elder financial abuse.

Surprisingly, the nation has no mandatory reporting requirements in any state or territory for abuse that occurs in the community setting. Only residential aged care homes are required to report on elder abuse, but that is limited to physical and sexual assaults only, not financial abuse.

In practical terms, elder financial abuse occurs when family members or trusted friends, or strangers, cheat an older person out of their assets.

Data from Queensland’s Elder Abuse Prevention Unit suggests the majority (72 per cent) of elder abuse perpetrators are sons or daughters and a third (33 per cent) live with the victim. 

Read more: Why you should make an advance care plan

The World Health Organization describes elder abuse as “the silent pandemic”. Even if we cannot quantify the issue, we know it is an issue affecting all nations.

As cases of elder abuse generally occur in the privacy of one’s home, identifying, seeking help and prosecuting the perpetrator/s can sometimes be challenging. Unfortunately, there is also no standard approach to tackling financial elder abuse as each situation brings with it a web of complexities and particularities. 

Particularly vulnerable are those who have financial means, but have lost mental capacity and are in need of 24-hour supportive care.

One recent case I was involved in relates to a gentleman who was removed from his home and placed in residential aged care. At the time, Gerry* was a72, three times divorced and had a diagnosis of dementia. Before moving into aged care, he owned a string of successful pharmacies. 

For more than a year, Gerry’s aged care fees went unpaid. The home contacted me because he had racked up a whopping $70,000 bill. I was informed that the financial decisions were being made by a stepdaughter from his second marriage who lived in another state.  

Read more: Most Australians support a tax to improve aged care

From the outset, I knew something did not seem right. 

When faced with a case such as this, I take the following steps, which anyone can do to assess if financial elder abuse is involved.

1. Is the person safe?
Seek advice from your state or territory elder abuse support group or police if you feel the person is unsafe. These cases generally cannot be solved in a day, so it’s important to ensure the victim is in a supportive and secure environment. Respite care or moving to a family member’s home could be considered. In this case, Gerry was living in an aged care home, which I know well, that was responsible for his 24-hour supportive care. 

2. Go with your gut feel.
The most obvious red flag was that Gerry was in debt, despite having means before living in aged care. Also, there was no local family connection and a ‘non-family’ member making financial decisions raised questions. Often people take the opportunity to move a parent to an aged care home that is closer to them or to a support network. Gerry was essentially isolated. 

3. Find other members of the family or representatives.
Perpetrators often do their best to isolate the person from family and friends. Finding other members of the family or supportive friends can often help fill in knowledge gaps. In this case, a meeting with the aged care home revealed Gerry’s second wife had passed away. His wife and daughter from the first marriage were alive and, thankfully, willing to connect. A discussion with the daughter from the first marriage revealed that the stepsister was potentially fiscally unreliable. What transpired was that the daughter from the second marriage had borrowed $100,000. Repaying this loan to pay for her father’s aged care fees would have been in the best interests of the father, but she refused to pay it back and also neglected to pay his bills.

Read more: More are retiring with a mortgage

4. Establish a support team.
Seek out the experts who can help you establish the facts. I learnt that in Gerry’s case there were many gaps in the money trail, likely a reflection of mismanaged funds. The aged care home helped identify Gerry’s geriatrician, which was important to understand more about his cognitive state, his accountant to identify the forensic issues, and legal representation to establish a case for financial elder abuse.

5. Make the perpetrator accountable.
Together we were able to identify that the stepdaughter had not acted in the best interests of her father. She had used his money for her personal gain, such as purchasing a home. She also neglected to manage her father’s financial affairs. 

* Not his real name.

Luisa Capezio is an aged care adviser at Phillips Wealth Partners where she helps people navigate the complexities and costs of aged care. She is also the chair for an association advocating for new dementia models of care for people living with dementia

Has financial elder abuse been an issue for you or someone you know? Was it successfully resolved? Why not share your experience in the comments section below?

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Written by Luisa Capezio