What is Elder Abuse?
According to the world health organisation, elder abuse can be defined as single, or repeated acts, or lack of appropriate action, occurring within any relationship where there is an expectation of trust which causes harm or distress to an older person. Elder abuse can take various forms such as physical, psychological or emotional, sexual and financial abuse. It can be the result from intentional or unintentional neglect.
The purpose of this article is to outline the financial abuse of elderly people in relation to Succession law issues.
Why is this relevant? – Here are the Statistics
Elders are generally defined as people 65 years and over. Some elders have physical and/or mental impairment which results in impaired decision making capacity, and being wholly or substantially dependant on others. Around 20% of the Australian population is made up of seniors and baby boomers, these are people born between 1946 and 1954. The percentage of elders is only going to increase due to baby boomers getting older and living longer.
In 2015 there was 1 million people (1 in 2 elderly people) receiving age care services in Australia, with this number expected to rise to 3.5 million by 2050.
Baby boomers currently compose of 25% of Australia’s population, yet they own 51% of the nation’s private wealth. By 2020 when the older of the baby boomers hit their mid-seventies Australia will witness the greatest intergeneration transfer of wealth in history. That is, in the next 15 years, there will be a transfer of about 3 trillion dollars from one generation to the next.
Why has there been an increase in Elder Abuse?
Over the last few years, there has been a spike in elder abuse. This is largely due to the older population having substantially more personal wealth because of the increase in property prices and superannuation. Very little attention is being paid to the security of an elder person’s estate in the event of incapacity and death and their estates are not structured to prevent abuse. This is why it is very important to ensure that estates are structured appropriately and reviewed regularly with a lawyer to make ensure measures are in place to prevent abuse.
How does financial abuse occur?
Alarmingly, financial abuse to elderly people often goes unreported as people or their families are simply unaware the abuse has taken place until it is too late and the funds have already been squander.
Elder abuse generally occurs when;
- someone loses capacity or does not understand the nature or the effects of their decision/s;
- someone puts pressure on an elder to make a financial decision; or
- by criminal pursuits in regards to fraudulent behaviour.
From a succession law point of view, we look at:
- The Will:
An elder that changes their Will to disentitle a beneficiary and replace them with an unexpected beneficiary.
- Make financial decisions because of pressure from someone who is looking to receive a financial benefit;
- Give large portions of their estate away in curious circumstances;
- Have set up entities (such as a trust or company) where the elder has no knowledge of these types of entities.
- Change an Enduring Power of Attorney which will allow the abuser to access the elder’s legal estate.
What are the signs of elder abuse?
Some of the warning signs that an elder person is being abused are as follows;
- Significant withdrawal from the elders account;
- Sudden changes in the elder’s financial condition;
- Items or cash missing from the elder’s household or nursing home;
- Suspicious changes in their Will, Power of Attorney, titles, insurance policies, signatories to the elder’s signature card;
- Unpaid bills or lack of medical care;
- Financial activity the elder couldn’t have done such as a ATM withdrawal when the account holder is bedridden.
Preventing Elder Abuse and Neglect.
What are the key ways to prevent elder abuse and neglect?
There are three key ways in order to prevent elder abuse and neglect.
- Listen to elders and their caregivers;
- Intervene when you suspect elder abuse;
- Educating others about how to recognise and report elder abuse.
At O’Connor Ruddy & Garrett Solicitors, we have acted for elders and their families to ensure their estate is structured to prevent elder abuse and ensure an elders estate is preserved for the intended use. If you suspect an elder is being abused and their estate is at risk, contact our office for a free initial consultation to discuss how we can assist. The sooner we can identify the offending behaviour, the more likely we are to rectify the situation and preserve the estate assets.