We’re talking about financial abuse, a form of abuse so common it costs the economy $15.6 billion per year. But it has a real human cost too, one that can’t simply be expressed in a number.
In part 2 of our financial abuse series, we’ll explain what elderly financial abuse is, how many people it affects, how you can recognise it, and most importantly, what you can do to help.
You can do the same in part 1 of our financial abuse series on domestic financial abuse.
If you or someone you know is experiencing domestic or family violence, call 1800RESPECT
In an emergency or if you’re not feeling safe, always call 000.
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What is financial abuse?
Financial abuse is generally described as controlling someone’s ability to acquire or use their own financial resources or manipulating their finances for your own benefit. This can include stealing money, coercing or guilting them into signing something, restricting their ability to withdraw money from ATMs, siphoning their paycheque and so on. As opposed to scams by strangers, financial abuse often involves two or more people who have a close relationship.
Elderly financial abuse
Elderly financial abuse is financial abuse directed at an elderly person, usually a relative (like a parent), someone in a nursing home, or someone who lacks the ability to look after themselves through conditions like Alzheimer's.
Common forms of elder financial abuse include:
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Forging their signature on documents
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Forcing them to sign wills or deeds
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Using their credit cards or bank cards without their knowledge or permission
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Using falsehoods or deception to get them to sign something against their interests
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Generally taking advantage of them (such as moving into their property and not paying rent).
Between 2% and 14% of all seniors experience some kind of abuse, according to the Australian Institute of Family Studies (2016), and financial abuse is the most common form. Despite this, financial abuse of our nation’s seniors often goes ignored or under-reported, although National Seniors Chief Advocate Ian Henschke said this is changing.
“I think there's a growing awareness about financial elder abuse, and that’s happened over the last 5 to 10 years because we've now got more and more people reporting that there is a problem,” Mr Henschke told Savings.com.au.
“It's a bit like the situation was a few years ago with child abuse. People were not talking about it, and the most important thing to do is to raise awareness so that people know that it happens.
“Sadly a bit like child abuse, it's often people that are very well known to the victim such as family members.”
Mr Henschke said around 85% of financial abuse of seniors is committed by family, with children accounting for nearly 50%:
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25% is committed by the victim’s daughter;
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24% is done by their son;
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36% by other family members, like spouses or siblings;
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7% is committed by friends;
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4% by a carer; and
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3% by a neighbour
‘Other’ accounted for the remaining 1%.
Elderly people fall victim to such abuses for a number of reasons. They might not understand the technology or might never expect a loved one to take advantage of them. They might not be in a position to do anything to stop it, or they might be too embarrassed or prideful to go to the police.
“Theft is theft, regardless of whether you are stealing from your mother or your father or your daughter, or your son. This is something that I think we have to actually recognize,” Mr Henschke said.
How many people suffer from financial abuse?
Financial abuse is much more common than you might think, with millions of Australians potentially being impacted. Identifying numbers of elderly financial abuse victims is a bit harder to do since many cases of it often go unreported. According to Mr Henschke, many cases lead to rifts between families but often aren’t escalated, with only 20% of cases being reported to an authority.
However, we do know most cases of reported elderly abuse involve money, and according to the Australian Banking Association, it’s estimated around one in ten Australians will be impacted by elder financial abuse. More than half (57%) of Australians are worried about a loved one experiencing it.
Meanwhile, in the year 2000, there were 244 reported calls to the Elder Abuse hotline regarding money. In 2016, that figure had increased eight-fold to more than 1,700.
Elder financial abuse is a national crisis that needs a national solution
- Lewis Kaplan, Older Persons Advocacy Network (OPAN)
So recent data shows it’s actually very common and is only set to get worse as our population ages, and wealthier generations like Baby Boomers start to retire. By 2055 Australia’s population is expected to grow to 40 million, 25% of whom will be over 65, and something experts call “inheritance impatience” from family members who feel entitled to their assets (like superannuation balances or their high-value home) will undoubtedly make it worse.
What are the telltale signs of financial abuse?
There are ways you can pick up on someone being financially abused (either yourself or someone you know), or potentially if you are exhibiting some of these behaviours without realising. It can be even harder to properly identify signs of financial abuse against a senior, as they themselves may not fully understand what’s happening and the nature of the abuse may be much more hidden.
But there are some signs, and seeing one or several of the following could give you a clue:
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The person is sent eviction notices, warnings of unpaid bills despite having the money to pay for them normally
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Their care might be substandard compared to usual
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They’re uncomfortable around someone who manages their finances (like a power of attorney), or someone who lives in the property with them
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Some of their belongings, or even bank cards, go missing
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There are noticeable changes in their banking behaviours, like spending more money on activities they wouldn’t normally do (like strenuous exercise)
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Transactions are made that they couldn’t possibly have done, like withdrawing from an ATM elsewhere when they’re in a retirement home
Of course, it can still be hard to recognise financial abuse without having access to their bank statements. This is why we’ll go over how you can stop it from happening.
Is enough being done to stop financial abuse?
When it comes to the elderly, Mr Henschke feels not enough is being done nationwide in terms of legislation. National Seniors made a submission to the Attorney General in 2019 campaigning for consistent nationalised laws relating to powers of attorney, which is when a person has the authority to make financial decisions on behalf of someone else.
“I don't believe that's happened yet, so I think that in some areas, the changes that need to take place that would assist the prevention of elder abuse, or at least try and curtail it, they need to be done,” he said.
“We'd also like to see a designated body where you can report suspected financial elder abuse. There's nothing like that at the moment.”
In the absence of any significant legislation, Mr Henschke said people need to take a common-sense approach within their own family, such as extensive record-keeping and having two or more people helping.
“A recommendation that a lawyer told me was that when you're drawing up a power of financial attorney within a family, think about the idea of having your own rules and regulations within the family so you don't give all power to one person,” he said.
“If it's a family member, I would advise that one of the other family members actually be part of that decision-making process.
“We have to be more professional about the way we look at these things. If you're going to be looking after Mum or Dad's account, you keep records and those records should be looked at least once or twice a year.”
He also called for more specialised policing in Australia that specifically deals with financial abuse, similar to examples that already exist in the likes of San Diego, California.
The banks also have a significant role to play in stopping financial abuse - that’s where most of the money comes from after all. The Australian Banking Association has said it is offering ongoing training for branch tellers and staff to identify and help customers in sensitive situations and is running a campaign to raise awareness against it.
The COVID-19 pandemic has made financial abuse worse
While the coronavirus pandemic hogged most of the headlines in 2020, it seems that restrictions resulting from the virus have led to “a pandemic within a pandemic”, with lockdowns contributing to increase abuse among financially stressed households, particularly in Victoria which had the hardest restrictions.
With more families living at home together out of necessity, data compiled by Crime Statistics Victoria showed a 20% increase in family incidents reported by someone over 55 compared to the year prior. Most of these were suspected to be financial in nature.
“Social isolation is a driver of elder abuse – and the COVID-19 pandemic has increased social isolation for many older people,” Age Discrimination Commissioner Dr Kay Patterson said.
“Financial pressures on adult children are a driver of financial elder abuse – and the economic fallout of COVID-19 has increased those too. This is a perfect storm.”
What can victims of financial abuse do?
Getting help for financial abuse can be very tricky. In the case of relationships, some people don’t seek help because they’re afraid for their safety or feel ashamed or embarrassed, while victims of elder abuse often don’t know what’s going on or might not want to get a family member in trouble.
There are a lot of other reasons people don’t seek help, and this is compounded when it comes to senior abuse which is even harder to identity. But ASIC’s MoneySmart lists a number of free and confidential helplines you can call, which we’ll list below. You should call these numbers if you’re aware of an elderly relative being taken advantage of, or if you’re able to do so yourself.
But remember, if you feel your life is in danger, or the life of someone you know, then call 000.
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Crisis support |
13 11 14 24 hours |
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Help if you're struggling with debt |
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Family counselling, mediation and dispute resolution services |
Relationships Australia |
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Elder abuse victim support |
1800 ELDERHelp |
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State and territory elder abuse victim resource centres |
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Advocacy and advice for older people |
Older Persons Advocacy Network |
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Help to get back on your feet |
Good Shepherd Australia Financial Independence Hub |
Source: MoneySmart
Free legal advice is widely available if needed.
Savings.com.au’s two cents
Savings.com.au’s purpose to help people save money and achieve financial independence, and financial abuse is in direct opposition to what we stand for. Preventing someone from using and accessing their own money or taking advantage of an elderly person who earned that money is unacceptable.
The effects of financial abuse are wide-ranging, and there’s a good chance someone reading this is affected by it in some way, either themselves or someone they know. We aren’t going to give advice we aren’t qualified to give regarding people’s wellbeing, but we will recommend calling any of the support numbers listed above or the police if necessary. An expert trained to deal with financial abuse will be able to help.
In the meantime, we should all take extra steps to look out for one another. Check-in on a friend or elderly relative, and learn to look for the telltale signs that not all is right with their finances.
Photo by Alex Boyd on Unsplash
Harry O'Sullivan
Denise Raward
Emma Duffy
