By Julia Tutt – Senior Associate
With an ageing population and the largest transfer of intergenerational wealth ever occurring across the country over the next couple of decades, it is important to be aware of the risk of financial elder abuse and what you can do to prevent it now and in the future.
Recent studies have shown that 76% of perpetrators of financial elder abuse are adult children and enduring attorneys are implicated in 50% to 85% of cases of financial elder abuse. This, combined with the fact that a large proportion of people did not obtain legal advice when preparing their enduring power of attorney (EPOA), results in a worrying trend of lack of information and knowledge.
If you appoint an attorney by way of an EPOA, generally speaking, you are appointing someone to act on your behalf in relation to financial matters. The extent of these powers vary from state to state, however at a very high level, you are granting your attorney the ability to access your assets, as if they were in your shoes. They have a fiduciary duty to act in your best interests. Unfortunately, some adult children abuse this power.
Things to think about to mitigate risk of financial elder abuse include:
Consider very carefully whom you are appointing – are they inherently trustworthy? Have they had their own financial struggles in the past? Are they organised? Are they responsible? Can you explain this reasoning to your solicitor with examples?
Should you consider more than one attorney to act jointly so that they may keep each other accountable?
Should you nominate an independent person for your attorney to report to, for example, an accountant or the Queensland Public Trustee (QLD only)?
Should you give your attorneys the ability to make gifts? This may result in them justifying payments to themselves that you would not have ordinarily made.
Have you had open conversations with your loved ones about your wishes for the future and what you want to happen in the unfortunate event of your losing capacity to make decisions for yourself?
It is also important to keep up with technology. Oftentimes adult children assist their parents in the ever-changing technological landscape. That can contribute to an unnecessary reliance on others over time, significantly impacting independence and therefore vulnerability for financial elder abuse.
If you need assistance in reviewing or preparing your estate planning documents, we are able to provide comprehensive advice and discuss your specific circumstances to mitigate the risk of financial elder abuse now, and in the future.
Please contact a member of the de Groots team to discuss how we can best assist you – 1300 408 766
Brisbane: (07) 3221 9744
Sydney: (02) 9101 7000
Melbourne: (03) 9975 7321
Get started with one of our experienced estate planning lawyers
For practitioners: More on Wills Probate and Administration Practice (Qld)/Wills Probate and Administration Practice (NSW)
