The soaring cost of financial abuse
4 November 2020 at 7:50 am
What may look black and white can have many shades of grey, says Beyond Bank Australia financial crimes analyst Sharon Thompson.
On the surface, financial abuse seems so obvious, so clear. Money is stolen, bank accounts are drained, cash is used without consent.
Yet, financial abuse, in all of its ugliness, is a deeply complex issue with many shades and facets that may not immediately be apparent.
It is insidious, it leaves people fearful and worst of all, it is escalating rapidly as local communities, households and families cope with the economic pressures brought about by the COVID-19 pandemic.
What we do know is that financial abuse is often a form of family violence. Victims tend to be elderly, incapacitated in some way or simply vulnerable and they are left feeling anxious, isolated and depressed.
Beyond Bank Australia, as one of Australia’s largest customer-owned banks, is fortunate to have strong connections to local communities right around the nation, in cities, regional centres and country towns too.
These connections mean we are alert, watchful and attuned to financial abuse.
Sadly, we see it often. Importantly, we can act quickly.
And this is the challenge for all of us. Recognising the signs of financial abuse early, knowing what to do and moving swiftly to prevent it.
At Beyond Bank, our experience has often come from our frontline branch staff who have seen financial abuse in its many guises, its many shades of grey.
We have seen adult children bring in parents to sign up for a car loan when the parents don’t drive.
We have seen elderly family members pressured to sign as guarantors for home mortgages that end up being defaulted due to non-payment of the loan.
We have seen older or incapacitated people subtly coerced into opening joint accounts with a younger relative who then drains all the funds.
Frustratingly, the ways and means to stop these and other forms of financial abuse are not written down in a handy playbook.
Different states and territories have different rules. Legal instructions and recourse can vary and there is no compulsion for people to have a power of attorney or other relevant document that can help direct a path of action.
Sometimes, it simply comes down to knowing what is morally right or wrong, what is ethically just not ok.
In recent times, we have also seen many people fall prey to scammers who have used the pandemic to forge new and innovative ways to manipulate and steal.
This year alone, the federal government’s Scamwatch program has received more than 4,700 scam complaints that mention the coronavirus resulting in losses of almost $5.5 million.
We need to be just as innovative in our thinking, and our approach to combatting and beating these scams before they take hold in local communities.
In fact, as we move beyond the health challenges we face now and into the long-term economic consequences, how we respond to and deal with financial abuse will say a lot about how we are as a community.
How we care, how we support, how we remain inclusive and connected.
It will also prompt us to ask questions of ourselves. What can we do better? How can we more rapidly spot the warning signs of financial abuse in all their shades of grey? How can we advocate for this section of our community that struggles to have a voice?
For us, as committed as we are to social justice, social economies and communities with purpose, there’s a chance to lead the way.
Our foundation is committed to partnering with organisations to improve financial independence for vulnerable people in our community.