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ABA calls for reform to tackle elder financial abuse

Tuesday 27 February 2018


Regulation

Too many elderly Australians are exploited financially by family and close friends.

These are the words of Australian Bankers’ Association (ABA) CEO, Anna Bligh, speaking at the 5th National Elder Abuse Conference last week.

The challenge banks have with reporting suspected cases of financial abuse were highlighted by the Australian Law Reform Commission (ALRC) in its 2017 report, Elder Abuse—a National Legal Response. The ALRC recommended the creation of an investigative body to look into these cases.

“If there was a national register with consistent laws across the country, it would help banks—and indeed other financial institutions—to verify the authority of a power of attorney or court-appointed administrator when they present themselves as acting on behalf of a customer,” Bligh said.
A statement released by the ABA noted that 40 per cent of elder abuse cases are related to financial exploitation.

While banks’ staff are on the frontline on this issue, they are currently ‘hamstrung’, as there is nowhere for bank staff to report suspected cases of financial abuse.

At the moment, the customer has to make a complaint to the police.
“Current state trustees and public advocacy offices often require the bank to make a formal application and provide detailed information about the customer—for example, their medical history,” the ABA said.

However, the Bankers’ Association believes this is not an appropriate role for banks, stating that bank staff are not qualified to make assessments about a customer’s competency. It is because of this that the ABA believes an appropriate body should be created to which banks can report suspected cases of financial abuse.

Bligh said the changes recommended by the Australian Law Reform Commission in 2017 would be beneficial. These are:


  • Legal changes to help bank employees safely report suspected financial abuse to a designated body;
  • A national register of power of attorney orders; and 
  • A standardisation of power of attorney legislation.