06 Jun Legal and financial fraud on the elderly
Fraud upon the elderly is becoming more and more widespread and sophisticated.
Presently there does not appear to be any unified Australian legislation which protects older people from this type of abuse. In a 2011 study conducted by the Crime Research Centre of the University of Western Australia its findings were that “misuse of Enduring Powers of Attorney was the most frequently mentioned financial abuse issue, followed by the perceived responsibilities of Banks to increase protection of vulnerable older people’s accounts”.
The study recommended auditing of Centrelink nominees, a national register of Powers of Attorney and more uniform laws on Enduring Powers of Attorney.
Common complaints of elder financial abuse which I come across in my line of work include: forced changes to a Will, misuse of Financial Power of Attorney, Title Fraud, nominated Centrelink carers misleading banks, and breach of verbal promise to get financial advantage
Consider this fictional example. Anna, an 82-year-old widow, is having trouble keeping up maintenance of her large home. Her son, George, convinces her to sell her home, give him the cash and move in with him and his wife. Anna agrees to do this and relies on his promise -that George will look after her for rest of her life. After she moves in with George and his wife in their rented unit, she gives George the sale proceeds of her house. Within 6 months arguments ensue and Anna forced to leave. George does not give his mother the money back. Anna tries to take legal action against George to get the money. But George lost the money in an unsuccessful business enterprise and he is now bankrupt. George and his wife are unemployed and have no assets. Anna is effectively homeless and destitute.
As a lawyer I see these real life situations and real victims; they are not fiction at all.
For those who work with, know or care for an elderly person, below are preventative tips the elderly can take to avoid financial abuse or fraud.
- Ask a trusted person to check your bank accounts and credit card statements for unauthorised transactions. Most banks have provision for account holders to give authority access to another person to “view only” the accounts.
- Make sure your financial and legal affairs are in order. If they aren’t, get professional help to get them in order, with the assistance of a trusted friend or relative if necessary but ensure that the person preparing the document is a qualified lawyer and when instructions are given only the elderly person and the lawyer are in the room.
- If a lawyer is dealing with an elderly person or someone who is possibly losing capacity, they have a duty to get medical evidence to be assured that the person is capable of giving instructions and understanding any documents prepared for signing. Lawyers have professional indemnity insurance insuring against the risk of negligence in drafting documents if it leads to a financial loss.
- If a person has lost capacity but legal and financial decisions and actions still need to be taken for them, usually the first port of call is the relevant guardianship tribunal (VCAT). In some special circumstances applications to the Supreme Court can be made to have a statutory will made by the court for the incapacitated person.
- Have a lawyer store your deeds including original wills, powers of attorney and titles to homes. Lawyers do not normally charge any fee for this service but you should check when asking for this service. Once you entrust the deeds to their possession they are charged with a duty to store them safely keep records and protect the deeds from movement without proper consent or legal authority. The Law Institute also maintains records and movement of the law practice.
- If you able to get a legal consult with a Community Legal Centre or a private law firm offering first consult, ask for a legal health check to see if your affairs are really in order or not. It is recommended that deeds are reviewed every 5 years or earlier particularly if there has been a change in the family such as divorce, death marriage or new addition to the family.
- Always get a legal document drawn up if there is a verbal agreement between family members involving substantial sums of money.
Maria Rigoli is the founder and principal of Rigoli Lawyers, a law firm assisting clients with inheritance disputes and elder law issues.
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