5 years ago
LAUNCH OF THE FINANCIAL SERVICES COUNCIL (FSC) PREVENTION OF ELDER ABUSE GUIDE
SENATOR DEBORAH O’NEILL
Good morning everyone.
Can I commence my remarks this morning by acknowledging that we are gathering on the land of the Gadigal people and pay my respects to elders past and present.
I’d like to make a particular plea for you in your roles to undertake a particular level of care for those who are of the First Nations, who are encountering in some cases, in their families, financial services without very much cultural capacity or cultural inheritance from previous generations. Particular forms of vulnerability exist in these communities so I’d encourage you and the organisations you work for to think about what you might do, particularly for First Nations People.
For me it’s important that we acknowledge, but we also have a think about what that means for us in all the different parts of the professions that we represent.
I’d like to acknowledge you Sally, for your leadership here at FSC and thank you for your very generous introduction. Sometimes I’ve just been a pain in the neck, but I think that’s just part of the job for all of us at points in time – to be a pain in the neck, to make change and ask questions. Australian people deserve the best from all of us. We share that civic responsibility whether we’re in public life or in the private sector- it’s our joint responsibility.
So can I say good morning to everyone and thank you for the invitation to be here.
It is a privilege to share the room with so many like-minded people who actually do care about action on elder abuse. It’s part of your job and also hopefully part of your mission to serve in the best possible way in the role that you undertake.
In my view there has never been a more important time for the financial services sector to be aware and cognisant of this issue.
As our population ages and we continue to live longer and hopefully healthier lives than ever before, the number of people affected by elder abuse will also increase unless we act now to stop it.
Elder abuse will be one of the biggest challenges for our ageing population. A failure to tackle elder abuse will have a devastating impact on the future of our country.
Failure to tackle elder abuse is, in my opinion – not an option, and it’s about making that cultural change now before we end up with a tsunami of problems.
ELDER ABUSE IN AUSTRALIA
According to the Australian Institute of Health Welfare almost 11,000 calls were made to elder abuse helplines across Australia in 2017-18. Female victims outnumbered male victims in each state and the proportion of victims generally rose with age. Emotional and financial abuse were the most common types of elder abuse reported.
That’s not a lot of information is it? It’s not really a lot of information to help us tackle the issue is it? Limited information and a lack of consistent and comparable data are the biggest barriers to effective planning and response to elder financial abuse.
Exact figures on the prevalence of elder abuse are hard to pinpoint, but there is no doubt it will increase as our ageing population grows, unless we bring it out from behind closed doors and talk about this in the full light of day.
Each year in June I am warmed to see the colour purple splashed around the nation on World Elder Abuse Awareness Day – a nominated day used to highlight a form of domestic violence that until recent years, hasn’t really received the public attention it deserves. Perhaps this is just one small action to think about for your calendar each June. Put it in your calendar – there is a day when it’s up to all of us to talk about this. As thought leaders in the financial services sector you have the power to make a difference with regards to that awareness raising.
The Banking Royal Commission and now, the Aged Care Royal Commission have certainly put the mistreatment of older Australians in the spotlight and I think it’s absolutely about time.
It’s about time people stood up and really paid attention to this scourge on our society.
ELDER FINANCIAL ABUSE
A key takeaway from the Banking Royal Commission was the prevalence of older Australians being exploited financially by people in positions of trust.
Revelation after revelation of irresponsible lending was a sobering reminder that we need to do more to protect older Australians financially.
Older Australians are increasingly vulnerable to financial abuse particularly if they have lost their ability to manage their own personal financial affairs, are isolated, lonely, unwell or reliant on someone else to act in their best interests.
Sally indicated that I live on the Central Coast and that I am the duty Senator for the seat of Robertson, but I’m also the duty Senator for the seat of Hume, which goes from the edge of Camden down through Goulburn and out west; the duty Senator for the seat of Riverina, right down to the Murray River; the seat of Farrer, right out to the border of South Australia and Victoria; and the largest seat in NSW – Parkes, where the Murray Darling issues are really prominent. All of these communities are filled with older people who are under incredible pressure and many of them are taking their financial advice not in those regions, but here in the city and your organisations would be interacting with them. I urge you in the context of the drought to be very mindful of the huge financial pressure that exists and the context that this places around intergenerational wealth management.
Elder financial abuse really makes my skin crawl because it’s a profound form of unexpected exploitation almost always occurs at the hands of someone trusted such as family, friends or carers.
I just took a call from my daughter which prompted me to make this little point to you to think about before you commence your day of deliberation. The point being how important relationships are, an example is my 80 year old mother and the way we interact with her and support her. The trust in that relationship is so important, but that’s not the way it is in every family or every generation.
Financial abuse is one of the most common forms of elder abuse and it covers such a broad range of misconduct. It touches all aspects of different financial institutions which is another reason why the Guide being launched is important to raise awareness more broadly.
We need a cross industry and holistic approach to addressing these abuses and not in a piecemeal and ineffective fashioning of a response to an emerging crisis.
I’d like to briefly touch on the nature of professionalism. I used to be a teacher and I lectured in education at the University of Newcastle and one of the key things we did at the commencement of a degree, and I would remind them every year, is that they are professionals. What is a professional? It is somebody who has such power and influence over another that they are called on in every interaction to act in the best interests of the other person. This is a call to a moral code that is extraordinary. We don’t talk about it very much but you make a moral decision in every interaction you have with somebody over whom you have incredible power, every day, in everything you do. This is at the heart of why I am here talking with you today – I see you as gatekeepers to safety, or deniers of that, through your declared, learned and practiced moral option for the other who you are looking after.
POOR LENDING
Examples of financial elder abuse are sadly becoming far too common. I have been horrified by some very disturbing examples of elder financial abuse surrounding poor lending practices, including:
Older, seriously ill people, who are surviving on very limited incomes, tricked into exorbitant loans that they will never, ever be able to repay because they’ve received no proper financial advice.
Elderly people being granted reverse mortgages that are of absolutely no benefit to them.
People living with dementia being overwhelmed and drowned by loan top-ups because they have poor comprehension of the risks that they are undertaking.
And just last week, there was a piece on Channel Ten led by an investigation by my friend in the House of Representatives, The Hon Bill Shorten. It talked about reverse mortgages which are provided by the government, and the extraordinary level of interest rate that still exists on those loans. We’ve been taking on the banks and saying you should be handing on the interest rate cut, but the government rate has remained. I think it’s over 5 per cent. I think it’s pretty extraordinary that this is happening.
EMOTIONAL AND THIRD PARTY LENDING
I have also been contacted by constituents about emotional or third party lending. These malicious practices are some of the ugliest drivers of elder financial abuse.
If you ask any parent, most of them will tell you that they would do anything to help their children, especially in times where the cost of living is skyrocketing, housing prices are soaring and wage growth is the lowest on record.
But there are too many cases of older people being persuaded or pressured into:
Taking on the legal responsibility for bills that are not their responsibility;
Signing a will or power of attorney in order to transfer property or financial gain to their children;
A joint loan to help their children out in financial hardship, to start up a business or renovate their house.
These types of loans are secured by the older person’s home or equity with the child agreeing to pay off the debt. This is very risky for the older person who could lose their home and be forced into homelessness if their child defaults.
During the course of the Franchising Inquiry we saw entire families across generations lose everything to very exploitative practices with loans which were indeed provided by preferred lenders. All of the big four banks were preferred lenders for some of the franchisors. Institutional establishment for the opportunity for financial abuse is a very recent reality in this country and the government is still sitting on the Report of this Inquiry. This form of financial abuse is well and truly alive.
Something else to watch out for is elderly people withdrawing numerous large sums of money at an ATM under the direction of someone else. The move away from as much face-to-face service creates greater responsibility for financial professionals, and an even higher moral imperative to be vigilant.
There are also too many older people signing a financial document they don’t understand which is to their detriment– this is particularly prevalent with older people living with dementia or those from a culturally and linguistically diverse backgrounds.
‘INHERITANCE IMPATIENCE’
Some of the saddest stories I’ve heard stem from what is known as ‘inheritance impatience’. These are all unsettling examples, devoid of the love, care and trust that should be the hallmarks of the relationship between parents and children.
This can present itself as:
Children or family taking advantage of parents living with dementia or debilitated by illness, using a power of attorney to fleece them of their life savings.
Children or family selling their parents’ home from underneath them and using the proceeds to fund expensive holidays and pay off personal debts.
Children or family threatening or manipulating their parents to move into an aged care home before they are ready.
Children or family persuading their parents to transfer their home to them with an ‘understanding’ that the parent will be able to be remain in the home or provided with a granny flat and be cared for. Too many elderly parents are being left destitute under these cruel agreements.
These things are actually happening. They are not figments of our imagination. This is the reveal of the ugliest side of family life for too many Australians.
I do want to raise an issue in which I think this can escalate very quickly, and that is the legislative reality of euthanasia laws now being enacted in Victoria and Western Australia.
Some of the issues around exploitation that could be part of euthanasia are to do with financial abuse and finances.
I recall Kim Beasley speaking at a High School on the Central Coast, Kincumber High School which is surrounded by retirement villages. There was a real push amongst the crowd for euthanasia to be advanced quite quickly.
Kim Beasley told this story about a public hearing in Canberra when they were giving consideration to euthanasia at that time. A young man and his sister came to give evidence which in summary was – ‘you should enact euthanasia laws because our mother is spending our inheritance on her healthcare’.
This shocking story has rested with me for nearly 20 years. I don’t live with people like that and I don’t work with people like that, but sadly sometimes I meet people like that – they are in our community and they will take advantage if the opportunity is there.
WHAT NEXT
It’s clear from the examples I’ve just given that current law doesn’t appropriately deter the financial exploitation of vulnerable older Australians.
But I don’t think containing elder abuse can be left entirely to law reform. This is a cultural practice that needs to be understood. It’s very complex.
Which is why we need Guides like the one the FSC has launched today to generate awareness and action. I encourage you all to do everything you can to advocate and implement change within your organisations to create protection for people who are vulnerable.
Know the signs: If you see older people making unusual financial decisions, repeatedly asking the same questions, being coerced into signing something or being dominated or spoken over during a meeting with you this should raise red flags.
I’d like to finish up by reinforcing my commitment and the Labor Party’s steadfast commitment to stamping out elder abuse in all its forms and that we work to prevent it growing any further.
This is far too important an issue to be partisan about – we all share these concerns across the political divide and we will continue to work with all levels of government to enact change.
I acknowledge that the Federal Government’s work to progress its response to the Australian Law Reform Commission’s Report into elder abuse.
But disappointingly, delayed responses to Reports and slow implementation of recommendations have become a bit of a feature for this Federal Government.
We’ve seen the same with the Hayne Royal Commission and the PJC Report into Franchising reform.
So I will continue to push them to take action now, as I am with franchising, as a matter of urgency and remind them that this is not an optional policy area.
I want to make sure that older Australians, who have worked hard and acquired a sum of money for the security of their final years, are protected.
Labor has always been a friend to older Australians - you just have to look at the way we’ve tirelessly fought for superannuation and pensioners, and our vision for an age-friendly Australia.
I’m really committed to pushing this issue and I hope that after today your commitment becomes practical action that you can undertake.
I encourage you to remember that it’s not an accident that you’re here today, fate has brought you to this room and you are powerful leaders in a civic sense in your workplaces to make the changes necessary to prevent elder abuse.
Thank you.
ENDS
Can I commence my remarks this morning by acknowledging that we are gathering on the land of the Gadigal people and pay my respects to elders past and present.
I’d like to make a particular plea for you in your roles to undertake a particular level of care for those who are of the First Nations, who are encountering in some cases, in their families, financial services without very much cultural capacity or cultural inheritance from previous generations. Particular forms of vulnerability exist in these communities so I’d encourage you and the organisations you work for to think about what you might do, particularly for First Nations People.
For me it’s important that we acknowledge, but we also have a think about what that means for us in all the different parts of the professions that we represent.
I’d like to acknowledge you Sally, for your leadership here at FSC and thank you for your very generous introduction. Sometimes I’ve just been a pain in the neck, but I think that’s just part of the job for all of us at points in time – to be a pain in the neck, to make change and ask questions. Australian people deserve the best from all of us. We share that civic responsibility whether we’re in public life or in the private sector- it’s our joint responsibility.
So can I say good morning to everyone and thank you for the invitation to be here.
It is a privilege to share the room with so many like-minded people who actually do care about action on elder abuse. It’s part of your job and also hopefully part of your mission to serve in the best possible way in the role that you undertake.
In my view there has never been a more important time for the financial services sector to be aware and cognisant of this issue.
As our population ages and we continue to live longer and hopefully healthier lives than ever before, the number of people affected by elder abuse will also increase unless we act now to stop it.
Elder abuse will be one of the biggest challenges for our ageing population. A failure to tackle elder abuse will have a devastating impact on the future of our country.
Failure to tackle elder abuse is, in my opinion – not an option, and it’s about making that cultural change now before we end up with a tsunami of problems.
ELDER ABUSE IN AUSTRALIA
According to the Australian Institute of Health Welfare almost 11,000 calls were made to elder abuse helplines across Australia in 2017-18. Female victims outnumbered male victims in each state and the proportion of victims generally rose with age. Emotional and financial abuse were the most common types of elder abuse reported.
That’s not a lot of information is it? It’s not really a lot of information to help us tackle the issue is it? Limited information and a lack of consistent and comparable data are the biggest barriers to effective planning and response to elder financial abuse.
Exact figures on the prevalence of elder abuse are hard to pinpoint, but there is no doubt it will increase as our ageing population grows, unless we bring it out from behind closed doors and talk about this in the full light of day.
Each year in June I am warmed to see the colour purple splashed around the nation on World Elder Abuse Awareness Day – a nominated day used to highlight a form of domestic violence that until recent years, hasn’t really received the public attention it deserves. Perhaps this is just one small action to think about for your calendar each June. Put it in your calendar – there is a day when it’s up to all of us to talk about this. As thought leaders in the financial services sector you have the power to make a difference with regards to that awareness raising.
The Banking Royal Commission and now, the Aged Care Royal Commission have certainly put the mistreatment of older Australians in the spotlight and I think it’s absolutely about time.
It’s about time people stood up and really paid attention to this scourge on our society.
ELDER FINANCIAL ABUSE
A key takeaway from the Banking Royal Commission was the prevalence of older Australians being exploited financially by people in positions of trust.
Revelation after revelation of irresponsible lending was a sobering reminder that we need to do more to protect older Australians financially.
Older Australians are increasingly vulnerable to financial abuse particularly if they have lost their ability to manage their own personal financial affairs, are isolated, lonely, unwell or reliant on someone else to act in their best interests.
Sally indicated that I live on the Central Coast and that I am the duty Senator for the seat of Robertson, but I’m also the duty Senator for the seat of Hume, which goes from the edge of Camden down through Goulburn and out west; the duty Senator for the seat of Riverina, right down to the Murray River; the seat of Farrer, right out to the border of South Australia and Victoria; and the largest seat in NSW – Parkes, where the Murray Darling issues are really prominent. All of these communities are filled with older people who are under incredible pressure and many of them are taking their financial advice not in those regions, but here in the city and your organisations would be interacting with them. I urge you in the context of the drought to be very mindful of the huge financial pressure that exists and the context that this places around intergenerational wealth management.
Elder financial abuse really makes my skin crawl because it’s a profound form of unexpected exploitation almost always occurs at the hands of someone trusted such as family, friends or carers.
I just took a call from my daughter which prompted me to make this little point to you to think about before you commence your day of deliberation. The point being how important relationships are, an example is my 80 year old mother and the way we interact with her and support her. The trust in that relationship is so important, but that’s not the way it is in every family or every generation.
Financial abuse is one of the most common forms of elder abuse and it covers such a broad range of misconduct. It touches all aspects of different financial institutions which is another reason why the Guide being launched is important to raise awareness more broadly.
We need a cross industry and holistic approach to addressing these abuses and not in a piecemeal and ineffective fashioning of a response to an emerging crisis.
I’d like to briefly touch on the nature of professionalism. I used to be a teacher and I lectured in education at the University of Newcastle and one of the key things we did at the commencement of a degree, and I would remind them every year, is that they are professionals. What is a professional? It is somebody who has such power and influence over another that they are called on in every interaction to act in the best interests of the other person. This is a call to a moral code that is extraordinary. We don’t talk about it very much but you make a moral decision in every interaction you have with somebody over whom you have incredible power, every day, in everything you do. This is at the heart of why I am here talking with you today – I see you as gatekeepers to safety, or deniers of that, through your declared, learned and practiced moral option for the other who you are looking after.
POOR LENDING
Examples of financial elder abuse are sadly becoming far too common. I have been horrified by some very disturbing examples of elder financial abuse surrounding poor lending practices, including:
Older, seriously ill people, who are surviving on very limited incomes, tricked into exorbitant loans that they will never, ever be able to repay because they’ve received no proper financial advice.
Elderly people being granted reverse mortgages that are of absolutely no benefit to them.
People living with dementia being overwhelmed and drowned by loan top-ups because they have poor comprehension of the risks that they are undertaking.
And just last week, there was a piece on Channel Ten led by an investigation by my friend in the House of Representatives, The Hon Bill Shorten. It talked about reverse mortgages which are provided by the government, and the extraordinary level of interest rate that still exists on those loans. We’ve been taking on the banks and saying you should be handing on the interest rate cut, but the government rate has remained. I think it’s over 5 per cent. I think it’s pretty extraordinary that this is happening.
EMOTIONAL AND THIRD PARTY LENDING
I have also been contacted by constituents about emotional or third party lending. These malicious practices are some of the ugliest drivers of elder financial abuse.
If you ask any parent, most of them will tell you that they would do anything to help their children, especially in times where the cost of living is skyrocketing, housing prices are soaring and wage growth is the lowest on record.
But there are too many cases of older people being persuaded or pressured into:
Taking on the legal responsibility for bills that are not their responsibility;
Signing a will or power of attorney in order to transfer property or financial gain to their children;
A joint loan to help their children out in financial hardship, to start up a business or renovate their house.
These types of loans are secured by the older person’s home or equity with the child agreeing to pay off the debt. This is very risky for the older person who could lose their home and be forced into homelessness if their child defaults.
During the course of the Franchising Inquiry we saw entire families across generations lose everything to very exploitative practices with loans which were indeed provided by preferred lenders. All of the big four banks were preferred lenders for some of the franchisors. Institutional establishment for the opportunity for financial abuse is a very recent reality in this country and the government is still sitting on the Report of this Inquiry. This form of financial abuse is well and truly alive.
Something else to watch out for is elderly people withdrawing numerous large sums of money at an ATM under the direction of someone else. The move away from as much face-to-face service creates greater responsibility for financial professionals, and an even higher moral imperative to be vigilant.
There are also too many older people signing a financial document they don’t understand which is to their detriment– this is particularly prevalent with older people living with dementia or those from a culturally and linguistically diverse backgrounds.
‘INHERITANCE IMPATIENCE’
Some of the saddest stories I’ve heard stem from what is known as ‘inheritance impatience’. These are all unsettling examples, devoid of the love, care and trust that should be the hallmarks of the relationship between parents and children.
This can present itself as:
Children or family taking advantage of parents living with dementia or debilitated by illness, using a power of attorney to fleece them of their life savings.
Children or family selling their parents’ home from underneath them and using the proceeds to fund expensive holidays and pay off personal debts.
Children or family threatening or manipulating their parents to move into an aged care home before they are ready.
Children or family persuading their parents to transfer their home to them with an ‘understanding’ that the parent will be able to be remain in the home or provided with a granny flat and be cared for. Too many elderly parents are being left destitute under these cruel agreements.
These things are actually happening. They are not figments of our imagination. This is the reveal of the ugliest side of family life for too many Australians.
I do want to raise an issue in which I think this can escalate very quickly, and that is the legislative reality of euthanasia laws now being enacted in Victoria and Western Australia.
Some of the issues around exploitation that could be part of euthanasia are to do with financial abuse and finances.
I recall Kim Beasley speaking at a High School on the Central Coast, Kincumber High School which is surrounded by retirement villages. There was a real push amongst the crowd for euthanasia to be advanced quite quickly.
Kim Beasley told this story about a public hearing in Canberra when they were giving consideration to euthanasia at that time. A young man and his sister came to give evidence which in summary was – ‘you should enact euthanasia laws because our mother is spending our inheritance on her healthcare’.
This shocking story has rested with me for nearly 20 years. I don’t live with people like that and I don’t work with people like that, but sadly sometimes I meet people like that – they are in our community and they will take advantage if the opportunity is there.
WHAT NEXT
It’s clear from the examples I’ve just given that current law doesn’t appropriately deter the financial exploitation of vulnerable older Australians.
But I don’t think containing elder abuse can be left entirely to law reform. This is a cultural practice that needs to be understood. It’s very complex.
Which is why we need Guides like the one the FSC has launched today to generate awareness and action. I encourage you all to do everything you can to advocate and implement change within your organisations to create protection for people who are vulnerable.
Know the signs: If you see older people making unusual financial decisions, repeatedly asking the same questions, being coerced into signing something or being dominated or spoken over during a meeting with you this should raise red flags.
I’d like to finish up by reinforcing my commitment and the Labor Party’s steadfast commitment to stamping out elder abuse in all its forms and that we work to prevent it growing any further.
This is far too important an issue to be partisan about – we all share these concerns across the political divide and we will continue to work with all levels of government to enact change.
I acknowledge that the Federal Government’s work to progress its response to the Australian Law Reform Commission’s Report into elder abuse.
But disappointingly, delayed responses to Reports and slow implementation of recommendations have become a bit of a feature for this Federal Government.
We’ve seen the same with the Hayne Royal Commission and the PJC Report into Franchising reform.
So I will continue to push them to take action now, as I am with franchising, as a matter of urgency and remind them that this is not an optional policy area.
I want to make sure that older Australians, who have worked hard and acquired a sum of money for the security of their final years, are protected.
Labor has always been a friend to older Australians - you just have to look at the way we’ve tirelessly fought for superannuation and pensioners, and our vision for an age-friendly Australia.
I’m really committed to pushing this issue and I hope that after today your commitment becomes practical action that you can undertake.
I encourage you to remember that it’s not an accident that you’re here today, fate has brought you to this room and you are powerful leaders in a civic sense in your workplaces to make the changes necessary to prevent elder abuse.
Thank you.
ENDS