This article is courtesy of Colonial First State
People over the age of 50 and the elderly are particularly vulnerable to mistreatment, from scams and fraud to emotional blackmail and theft, and the impacts can extend beyond financial loss – for example, causing anxiety and depression, or preventing access to food, medical care and safety.
Similarly, people who are alone or isolated, have a physical or mental disability, are reliant on others for their care, experience language difficulties or have a limited understanding of finance are especially at risk of experiencing elder financial abuse.
A BIGGER IMPACT THAN IMAGINED
Older people tend to be less tech-savvy than their younger counterparts, and this puts them at greater risk of falling victim to online scams or fraud.
Additionally, it’s hard to assess the full magnitude of the problem because a lot of people don’t realise they’ve been the victim of a scam or fraud. And those who are aware may feel ashamed to admit it or report it.
However, that the real impact of these scams and fraudulent activity is a great deal larger than many people may imagine, with the available statistics not making for pleasant reading – for example, in FY2014/15 there were more than 1.6 million Australians affected by financial abuse costing $3 billion1, 76 per cent of which affected individuals aged 50 years or older.2
IDENTIFYING ELDER FINANCIAL ABUSE
As older people are often dependent on family members and other people for their day-to-day care or social contact, they can be particularly vulnerable to people in this circle abusing their position to get control their money or other assets.
Some of the most common types of abuse can include:
- Abusing power of attorney - Abuse can happen when a trusted person is given power of attorney over someone’s assets, and they abuse their ability to make decisions for them.
- Pressure, threats and intimidation - This could be physical or emotional pressure on an older person to make them a beneficiary of their Will, or sign over ownership of assets.
- Theft - Older people are particularly at risk of theft, especially if they have care needs. Thieves can exploit anyone’s physical or mental vulnerabilities.
To help identify other warning signs indicating possible elder financial abuse, visit the ASIC MoneySmart website.
COMMON TYPES OF FRAUD AND SCAMS
Fraud usually happens when somebody accesses another person’s funds without their knowledge or authority. They might not even be aware of the fraud until they notice it on their statement or receive a call from their bank. Common types of fraud can include:
- ‘Phishing’ is where your client is tricked into providing login or credit card details via a suspicious phone call or a link to a fake website.
- Malware installs software on your client’s computer after they click on a link in a legitimate looking-email, giving criminals access to your client’s bank accounts.
- Skimming happens when a device is installed on an ATM or EFTPOS machine that stores information from cards to use fraudulently later.
- Card fraud is when a client’s credit card details are used without their authorisation.
- Identity fraud occurs when your client’s identity or personal information is used to commit a crime, often through false financial documents.
- Cheque fraud uses fake, forged or altered cheques to pay for goods and services.
A scam happens when somebody gains someone’s confidence in order to steal their money or information. Scammers often use sophisticated lies to trick people.
Common scams attempted can include:
- IT Support that requires access to your client’s computer via installed software.
- Romance & dating scams where the scammer forms a relationship to extract money or gifts.
- Investment scams where the scammer offers fast, high returns.
- Unexpected money offered through a lottery or Nigerian scam where clients pay a small amount upfront for a larger share later.
- Travel scams offer fake free or discount holidays and ask for credit card or bank details.
- Fake charity scammers prey on someone’s compassion to get bank details for one-off or ongoing donations.
Talk to us if you feel you know a friend or family may be a victim of Elder Abuse.
- ABS, Personal Fraud, 2014-15
- Commonwealth Bank, 2018