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Print Chapter 2 (PDF 419KB) | < - Report Home < - Preliminary Pages < - Chapter 1 : Chapter 3 - > |
Introduction
Definition issues
Levels of fraud and financial abuse
Risk factors for fraud and financial abuse
Types of financial abuse
Types of fraud
Responses to financial abuse and fraud
Legal action
Mandatory reporting?
Role of banks and financial institutions
Education and awareness campaigns
Financial literacy
Other issues
Equity release schemes
Targeting of older people for unsecured risky investments
Guarantees
Credit
Charities and churches
Centrelink arrangements
Life insurance and superannuation issues
A crime is a crime, irrespective of the victim's age.1
Introduction |
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2.1 | Research indicates that older people are less likely to be the victims of criminal activity than other segments of the population. Older people face far lower risks than other age groups for personal offences such as robbery, assault, sexual assault and homicide. Similarly, risks for older people are also lower for crimes such as burglary and motor vehicle theft.2 As the Australian Institute of Criminology (AIC) explained:
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2.2 | Despite this lower risk, however, older people have a higher fear of crime than the general population.4 As the Council on Ageing SA explained:
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2.3 | Within the older age group, consumer fraud occurs more frequently than other types of crime.6 While acknowledging that there is little reliable data on the nature and extent of fraud generally in Australia, the AIC referred to a survey conducted in 17 industrialised countries in the year 2000. In that study, figures for Australia showed:
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2.4 | The AIC further noted that the impact of such fraud and financial crime against older people can be particularly severe:
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2.5 | This chapter examines fraud and financial abuse of older Australians. It explores the nature of such abuse and the factors that place older people at risk, and identifies the more common types of fraud and financial abuse. The chapter examines a number of possible responses and concludes by looking at some issues that have the potential to affect the long term financial well-being of older Australians. Financial abuse arising from misuse of substitute decision making mechanisms such as enduring powers of attorney is discussed in Chapter 3, and the issue of retirement village contracts and disputes arising from these type of arrangements is covered in Chapter 7. |
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Definitional issues |
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2.6 | Given the breadth of what can constitute fraud and financial abuse, the Committee felt it necessary to try and clarify what these terms meant. As the AIC observed:
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2.7 | Financial abuse, as defined by the World Health Organisation, is ‘the illegal or improper exploitation or use of funds or resources of the older person’.10 |
2.8 | In its submission the Law Institute of Victoria distinguished between fraud and financial abuse as follows:
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2.9 | The Victorian Government noted that financial abuse is a complex issue and is perpetrated against older people in a range of ways, including:
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2.10 | The Victorian Government went on to argue that:
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2.11 | Defining financial abuse is further complicated as the financial norms of families are diverse. There is a need for greater discussion about the meaning of ‘family money’ and asset management more generally.14 ‘What may be seen as a normal transaction or course of events within one family may be considered abuse by another’.15
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2.12 | The point at which a situation becomes abusive is not always clear-cut:
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2.13 | As noted in Chapter 1, there are no specific laws in Australia dealing with the broad category of ‘elder abuse’. Instead, criminal law at both the state and federal levels encompasses a range of actions that would be included in the term ‘elder abuse’, but that also apply to the whole population. |
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Levels of fraud and financial abuse |
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2.14 | As noted earlier, statistics on fraud and financial abuse of the elderly are difficult to obtain, but studies suggest that approximately 3-7 per cent of older people over the age of 65 will experience abuse from someone with whom they have a relationship of trust, with financial abuse identified as the fastest growing type of abuse.18 It is common that, where abuse is occurring, multiple types of abuse occur at the same time.19 |
2.15 | Other studies have confirmed financial abuse as the most common form of abuse of the elderly, including in Indigenous and CALD (culturally and linguistically diverse) communities.20 COTA Over 50s referred to research commissioned by the Office of the Public Advocate in Western Australia which found that:
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2.16 | As the Australian Securities and Investment Commission (ASIC) noted:
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2.17 | Balanced against this potential under-reporting is some evidence from overseas that indicates that high levels of reports of financial abuse towards older people have not been substantiated when investigated. For example, in a US study in 1996, ‘less than half of the reports received by an Adult Protection Service were substantiated’.23 |
2.18 | The lack of reliable statistical data and agreement on what constitutes financial abuse has the potential to hamper the development of appropriate responses to fraud and financial abuse. The Committee sees merit in a national study on the incidence of fraud and financial abuse of older Australians. |
2.19 | The Committee notes that commencing in 2007 the Australian Bureau of Statistics, as recommended by the Australasian Consumer Fraud Taskforce, will include key questions on consumer fraud in its regular household survey.24 This will provide some information on one aspect of fraud against older people, but a wider examination of the incidence and causes of fraud and financial abuse would assist policy makers. |
2.20 | Recommendation 1The Committee recommends that the Government task the Australian Institute of Criminology with undertaking a detailed study of fraud and financial abuse against those over the age of 65 (over the age of 50 for Indigenous Australians). |
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Risk factors for fraud and financial abuse |
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2.21 | National Seniors identified a number of broader societal factors which may contribute towards elder abuse:
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2.22 | Among the risk factors for older people for fraud and financial abuse is the fact that ‘significant levels of accumulated savings and investments may also increase the risk of fraud’:26
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2.23 | In addition, some financial habits of older people increase their vulnerability. The Country Women’s Association of NSW observed that:
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2.24 | In addition to having significant financial resources such as a house or superannuation, people as they age often develop health problems. Those who develop dementia may be ‘at greater risk of being manipulated and deceived’, while those with other health problems may be tricked into purchasing worthless remedies and cures for their particular medical condition.30 |
2.25 | The risk of exploitation for older people may be exacerbated by other factors, including:
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2.26 | For a range of reasons, many older Australians rely on family or close friends to assist them with day-to-day management of their affairs. Research undertaken by the School of Social Work and Social Policy of the University of Queensland into the financial management of assets by older Australians indicated that:
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2.27 | The research also indicated that only 16.8 per cent of the participants in the survey were assisted through some formal mechanism, such as an enduring power of attorney or guardianship order.33 |
2.28 | The existence of a power of attorney or some other form of substitute decision making mechanism, given current weaknesses in the system (discussed further in Chapter 3), does not appear to protect against the likelihood of financial abuse. Ms Anita Smith, President of the Guardianship and Administration Board in Tasmania, informed the Committee that research has indicated that ‘… a person is no less vulnerable to financial abuse when they have executed an enduring power of attorney’.34 Issues associated with the potential for financial abuse arising from the exercise of enduring power of attorney arrangements are discussed in more detail in Chapter 3. |
2.29 | While dependency on others, particularly close family members, for assistance with financial matters may create a situation where financial abuse can occur, the Committee believes it is important to remember that, on the statistics available, for most older Australians such arrangements work very well:
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2.30 | Carers Queensland also observed that legislation does not always recognise the reality of how families operate:
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2.31 | The AIC noted that:
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2.32 | There may be certain events that trigger financial abuse, including family conflict and financial stress. Substance abuse and alcohol use by perpetrators may also be contributing factors.38 |
2.33 | While the motivation of those who commit financial abuse may be complex and at times mired in past family history, it is possible to make some general statements about who the abusers are most likely to be, and how they see their behaviour:
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Types of financial abuse |
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2.34 | The Public Advocate (Victoria) observed that ‘[m]ost commonly, financial abuse — in general terms — involves family members in either: a) preserving an inheritance by not spending money on an older person’s welfare needs; or b) bringing forward an inheritance by using an older person’s assets for their own benefit.’40 |
2.35 | A number of submissions identified actions that constituted financial abuse, including:
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2.36 | The Committee notes that many of the above behaviours would be covered by existing criminal statutes, as actions constituting theft or deception. Other behaviours, however, have the potential to be abusive in character, depending on the circumstances. |
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Types of fraud |
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2.37 | The Australian Competition and Consumer Commission (ACCC) was established to protect the rights of consumers and business, through encouraging competition in the market place and by enforcing consumer protection and fair trading laws as set out in the Commonwealth Trade Practices Act 1974.42 The ACCC focuses much of its work on protecting the legal rights of ‘disadvantaged and vulnerable consumers’, with ‘old age’ being a ‘… characteristic which may identify a consumer as being at risk of being exploited in the marketplace’.43 |
2.38 | Parts IVA and V of the Trade Practices Act 1974 (Cth) contain a number of provisions governing the activities of corporations, and are designed to protect consumers against types of conduct including:
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2.39 | In addition, fair trading legislation of various kinds is in force in all Australian states and territories. Legislation at the state and territory level mirrors the provisions of the Trade Practices Act 1974 (Cth) in many ways, but is not limited to activities by corporations. In addition there is, with some variations, legislation among states and territories covering other consumer issues such as product safety and door-to-door trading. |
2.40 | The ACCC noted that within the broader category of ‘fraud’, scams are ‘a growing global problem and target people of all backgrounds, ages and income levels’,45 with older people becoming more vulnerable to fraud via new technology such as the internet. The ACCC identified a number of common consumer frauds and scams. The scams most commonly reported by consumers over the age of 55 were: |
2.41 | The ACCC noted that around 90 per cent of alleged scammers reported to it appear to be based overseas, and that therefore ‘Australian authorities may not be able to take action against many scams’.47 |
2.42 | In taking enforcement action, the ACCC indicated that it focuses ‘on areas of widespread consumer detriment and where it believes its actions will improve overall compliance with the TPA’.48 However, while ‘the ACCC can institute proceedings for a breach of the TPA it generally focuses on industry-wide conduct that affects many consumers and cannot mediate between individuals and the suppliers of goods and services’.49 |
2.43 | Consumer protection relating to the supply of financial services rests with ASIC. As the ACCC explained:
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2.44 | In 2004 the ACCC and ASIC signed a memorandum of understanding covering liaison, cooperation, assistance, joint enquiries and exchange of confidential information arrangements.51 |
2.45 | ASIC’s regulatory role with respect to financial services includes:
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2.46 | ASIC identified several areas of particular concern in relation to older Australians and the financial services sector:
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Responses to financial abuse and fraud |
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2.47 | There is no one single solution to the problem of financial abuse and fraud involving older Australians. As the AIC noted:
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2.48 | Financial abuse of older people, particularly by family members, may be difficult to prove due to a reluctance to acknowledge or report that abuse has occurred and then difficulties in substantiating the accusation. Victims are often reluctant to complain to police or other authorities about a family member or take legal action against them, even in the face of advice to do so.55 |
2.49 | In part this may be because of community attitudes toward asset management within families in particular. Alzheimer’s Australia highlighted what it described as current inconsistencies in community attitudes in this area:
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2.50 | While processes can be put in place to protect those who have lost capacity, it becomes more complicated where an older person is very vulnerable, but nevertheless competent:
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2.51 | Empowerment of older people was an important theme in any response to suspected financial abuse:
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2.52 | When older people do attempt to report financial abuse to authorities, the response is not always what they would hope. The AIC noted that:
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2.53 | The Committee received anecdotal evidence suggesting that police are reluctant, in some instances, to investigate claims of fraud and financial abuse:
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2.54 | The difficulties faced by the police were also highlighted:
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2.55 | The impact of inadequate responses from authorities can have significant long term implications:
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2.56 | The Committee believes it would be useful if special training could be provided to police officers to assist them in liaising with older members of the community and responding to the issues they face. In addition, it would be useful to explore whether retired police officers would be interested in returning to work on a part-time basis to serve as liaison officers for older people. |
2.57 | In this regard, the Committee notes that, in the United States of America, ‘law enforcement gerontologists’ have been used:
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Legal action |
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2.58 | As noted earlier, there is no Commonwealth, State or Territory legislation that is specifically aimed at addressing abuse of older people, although, as the Law Society of South Australia noted:
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2.59 | Legal remedies are available for older Australians who have been subject to financial abuse:
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2.60 | Some have called for ‘clawback laws’ to recover property that has been inappropriately or illegally transferred from elder persons.66 Others argued for a stronger legislative response. Mr David Walsh, a legal practitioner, argued strongly that the current legislative system was inadequate:
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2.61 | This view was not unanimously held. As the Victorian Government observed:
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2.62 | The AIC also advised that in the United States:
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2.63 | Even where an individual does wish to purse a matter through the courts ‘...the cost, standard of proof required, evidential difficulties where the claimant has cognitive difficulties or is frail all inhibit the potential for an outcome that provides redress’.70 |
2.64 | Barriers to older Australians accessing legal services are discussed in greater detail in Chapter 5, but it should be noted that cost is a major impediment for those seeking a legal solution to financial abuse and fraud. Access to legal aid to undertake such cases is very limited. Obtaining legal aid assistance requires a person to pass tests of:
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2.65 | Therefore, an older person who has been the victim of a fraudulent activity may possibly have an action for damages, but:
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2.66 | The NSW Ministerial Advisory Committee on Ageing (NSW MACA) also highlighted the fact that not all older people will be able to fully pursue criminal legal action:
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2.67 | It is clear to the Committee that for many older Australians experiencing financial abuse, particularly by close family members, a purely legal remedy is not going to be either effective or acceptable. Pursuing a close relative through the courts and seeking to identify their behaviour publicly as criminal is not something many would want. Alternatives need to be found that provide for investigation of possible financial abuse and intervention short of criminal proceedings. |
2.68 | The Law Institute of Victoria argued that it ‘...would see the criminalisation of the situations as the last resort, because, while it may help remedy some cases, there are all kinds of issues with enforcement and bringing the claims in the first place. We would advocate, at first instance, information and education programs on the part of older persons, their families, their carers and solicitors’.74 This was also supported by State Trustees, who suggested ‘having dispute resolution mechanisms available where mediation can be used rather than having people finishing up in courts and tribunals. Mediation can be used as a precursor before things get to the stage of involving lawyers’.75 |
2.69 | The Committee supports this approach, and in addition to education (discussed below), would like to see mediation or civil dispute resolution services enhanced to deal with such cases. Although the Committee has not specified which particular services might best be placed to carry out this work, it notes that the Australian Government is in the process of establishing 65 Family Relationship Centres around Australia. While primarily established to assist separating couples resolve differences through mediation, they are also a source of information and advice for wider family members such as grandparents. The Committee believes there is potential for these Centres to be funded to deal with other family disputes such as those that arise over management of assets. |
2.70 | Recommendation 2The Committee recommends that the Australian Government, in consultation with its state and territory counterparts, provide additional funding for mediation and dispute resolution services to assist older people to resolve financial disputes within the family situation. |
2.71 | A number of submissions were critical of the role played by ASIC in failing to protect consumers and in not prosecuting those responsible for various corporate collapses.76 One submission, for example, commented that:
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2.72 | One witness commented that:
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2.73 | Frustration with the apparently lenient penalties for certain types of financial abuse was also evident:
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2.74 | The Country Women’s Association of NSW was critical of action taken against those who perpetrate fraud:
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2.75 | While ASIC may prosecute those involved in corporate collapses, it did indicate that class action was also available to investors. In addition:
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2.76 | The issue of prosecution of those involved in corporate collapses is outside the scope of this inquiry. The Committee does note that a number of court cases are underway in regard to recent collapses. Whatever the outcome of such court action, in most cases investors are unlikely to receive full compensation for the funds lost, and those funds that are retrieved may well take many years to make their way back to investors. As part of its review of these corporate collapses, the Committee believes that ASIC, together with other regulatory bodies, should review the appropriateness of current legislation and penalties. |
2.77 | Recommendation 3The Committee recommends that the Australian Securities and Investments Commission review the current regulatory environment for unsecured investment products, together with disclosure requirements, with a view to improving consumer protection measures. |
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Mandatory reporting? |
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2.78 | The issue of whether there should be mandatory reporting of suspected fraud and financial abuse is complex and the subject of much debate, balancing the autonomy of the individual on the one hand, against the desire to protect those who are vulnerable. Mr J Gardner, Public Advocate Victoria, noted in his submission that ‘[o]ne of the central tensions for law-makers is to respect and give effect to the balance between the right to autonomy and the right to protection. ...the state, has accepted that it has a duty and a corresponding power to protect those citizens who are not competent’.83 |
2.79 | It was suggested to the Committee by some that there should be mandatory reporting of suspected financial abuse of older Australians, as occurs in some US jurisdictions. The Committee found that discussion of this issue was often complicated by assumptions about whether all abuse should be reported, or whether particular types of abuse required such action, whether the competence and wishes of the individual concerned was a factor to be considered, and uncertainty regarding the ultimate effectiveness of such an option. |
2.80 | Taking a wide interpretation, Ms Lillian Jeter, Executive Director, Elder Abuse Prevention Association, argued that there should be mandatory reporting by ‘all aged care professionals and those who work with vulnerable older persons to report any suspicious, suspected, or actual incidence of abuse, neglect, mistreatment, and/or exploitation...[of] vulnerable older persons in the community and in residential care facilities’.84 |
2.81 | Ms Jeter called for protective statutes for those older Australians, specifically:
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2.82 | Most US states have some form of adult protection statutes, covering a range of activities including physical, psychological, sexual and financial abuse, neglect and abandonment. Not all of the statutes are specifically focused on older people — the protection may be aimed at what is variously described as ‘vulnerable’, ‘disabled’, ‘endangered’ or ‘impaired’ adults (e.g. in Alaska, a ‘vulnerable adult’ is one who is 18 years of age or older who, because of mental or physical impairment, is unable to meet their own needs without assistance). In several states, most notably in Massachusetts and California, there are specific laws aimed at protecting an elder person (defined as 60 and 65 years and over respectively). In most US states, however, age is not in and of itself a specific trigger for the protective legislation to apply, but rather the critical factor is whether the person is considered vulnerable or disabled.86 |
2.83 | The US statutes also vary widely in ‘the definition of abuse; types of abuse, neglect and exploitation that are covered; classification of the abuse as criminal or civil; reporting (mandatory or voluntary); investigation responsibilities and procedures; and remedies for abuse’.87 |
2.84 | Most submissions did not support mandatory reporting. The Council on the Ageing SA, for example, argued that:
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2.85 | The Western Australian Government was quite categorical in not supporting mandatory reporting of elder abuse: There is no evidence from around the world that where mandatory reporting has been implemented that it has been beneficial. There are also some practical issues which need to be considered: |
2.86 | Difficulties were also identified by Ms Anita Smith, President of the Tasmanian Guardianship and Administration Board, who warned ‘[w]hat worries me about mandatory reporting arrangements is that all you are really creating is an offence for someone who has failed to report. I do not know that it necessarily has that effect of meaning that you get more reports’.90 |
2.87 | Looking at the issue from a different perspective, Mr John Harley, Public Advocate, SA, also indicated that he did not support mandatory reporting:
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2.88 | Doubt was further expressed about the usefulness of mandatory reporting:
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2.89 | Professor Wilson from the Assets and Ageing Research Team also argued against mandatory reporting:
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2.90 | The applicability of such a system in the Australian context was questioned:
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2.91 | The Committee noted that, as part of recent amendments to aged care legislation, there is now to be compulsory reporting of serious physical and sexual abuse at residential aged care facilities and the establishment of an Aged Care Commissioner. The Committee notes, however, that:
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2.92 | On the basis of the evidence before it, the Committee does not support the introduction of mandatory reporting of suspected financial abuse. The Committee does believe it is important, however, that voluntary reporting of suspected abuse be encouraged and protection provided to those who take such action. The Committee acknowledges that there needs to be some mechanism for those wishing to either report suspected financial abuse or obtain more information about the options available to deal with it. The Committee notes the excellent work done by a number of state based groups, including the Elder Abuse Prevention Unit (EAPU) in Queensland and Advocare in Western Australia. |
2.93 | The EAPU commenced operating in 1997 and its approach is ‘focused on empowerment through raising community awareness about the issue [of financial abuse] so that prevention measures can be taken. Community awareness raising is therefore seen as a major prevention strategy for this type of abuse’.96 This is supported by very practical measures including a confidential and anonymous help line. |
2.94 | Similar community support and information services are already available in most states and territories and the Committee would not want to see needless duplication of those bodies already working in this field. Coordination and sharing of ideas would be more productive and maximise the impact of available resources. |
2.95 | The Committee is aware that the Australian Network for the Prevention of Elder Abuse (ANPEA) has been recently reactivated and has as two of its goals the sharing of information about new developments, ideas and approaches in the identification and prevention of and response to the abuse of older people; and the identification of opportunities for improvements in policies, programs, community education and the training of professionals.97 The Committee believes ANPEA, if adequately funded, will provide a vital link in developing best practice and provide links between other services throughout Australia.98 |
2.96 | Recommendation 4The Committee recommends that the Australian Government provide ongoing funding to the Australian Network for the Prevention of Elder Abuse to assist it in its information sharing role among the many community and government bodies working in the field of elder abuse. |
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Role of banks and financial institutions |
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2.97 | The role of banks and financial institutions is particularly important in safeguarding older Australians from financial abuse. Among a number of possible indicators of a person being abused financially are the following:
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2.98 | The Australian Bankers Association (ABA) noted that the extent of financial abuse in the community is not known, but that their ‘member banks indicate that they have very low numbers of complaints about this issue, and the banking ombudsman has said that he has seen only a handful of complaints in this area’.100 As noted earlier in this chapter, however, the actual extent of financial abuse is not known and it could be argued that a lack of consistent reporting mechanisms across banks and financial institutions may in fact be one of the reasons for low reporting rather than an actual low incidence of such abuse. |
2.99 | Banks have been criticised for not taking more action in protecting their older customers:
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2.100 | Mr Brian Herd, a legal practitioner, indicated that ‘most of the cases of financial abuse [he comes]... across are the abuse of bank accounts. Now that abuse can only occur if the bank allowed that to happen. That allowance is generally in the nature of a blind eye as opposed to a conscious concern about the way a particular bank account is being operated’.102 Mr Herd acknowledged the difficulties faced by banks and other financial institutions:
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2.101 | The ABA noted that the bank-customer relationship is contractual and the bank can only act on the mandate of the customer. In addition, they noted:
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2.102 | The Committee notes that in California, ‘legislation has been introduced making it compulsory for banking and financial staff to report any suspected cases of financial abuse. Where a report is made, adult protective services are called in to investigate.’105 In Canada, older persons have begun ‘authorising their banks to monitor their accounts for unusually large transactions or unusual patterns of transactions. The bank is then authorised to raise its concerns with the account holder and to warn of the possibility of fraud. Account holders, however, retain full rights over their accounts and may elect to disregard any warnings given’.106 More details are provided in Figure 2.1. |
2.103 | The Committee agrees with the Victorian Public Advocate’s approach of seeking a ‘co-operative solution that does not impose mandatory reporting requirements. First there is a need for awareness of the problem and the role of banks and financial institutions in dealing with it and, indeed, their duty of care to their customers and their duty to avoid carelessly becoming party to a fraud.’107 Figure 2.1 The Saskatchewan modelIn Saskatchewan, Canada, the RCMP [Royal Canadian Mounted Police] developed a form letter that seniors can sign, giving bankers permission to call their clients before they process cheques that may be going to telemarketing scams. The text of the letter is:I, (name), give permission to the (bank name) and/or its employees to monitor the activity of my bank accounts and any other financial instruments I have with the bank. I also give permission for the bank and/or its employees to raise with me any concerns they may have about the nature of my transactions, and in particular, as those transactions relate to telemarketing frauds; and, to advise the Royal Canadian Mounted Police at their discretion. I reserve the right of final decision on all aspects of my financial affairs. (signed, dated and witnessed) This method ensures ‘the seniors are not losing any independence if they sign the form; it also reinforces the client’s right of financial decision on all aspects of their financial affairs’. 108 |
2.104 | Dr Smith from the AIC observed that a similar scheme to that operating in Canada:
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2.105 | Concern was expressed that current privacy laws would impose restrictions on the roles that banks can play in reporting financial abuse.110 However, it was noted that overseas:
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2.106 | When the Committee raised this matter with officials from the Attorney-General’s Department, it was advised that the Privacy Act ‘has in place arrangements to allow disclosure of information where that is appropriate—for example, with the consent of the person whose personal information it relates to or where a law authorises or requires the disclosure as well’.112 |
2.107 | In the Committee’s opinion, banks and financial institutions should be providing such assistance to customers as part of their normal duty of care. It is vital that the staff of banks and financial institutions are trained to recognise signs of potential abuse and that there are specific protocols with the bank or financial institution, and indeed across the industry, for dealing with such reports. |
2.108 | The Western Australian Government has been working with the banking and financial sector to ‘identify how the government can work with that sector to help them recognise and respond to situations of financial abuse of older people’. In response, the banking and financial sector has raised concerns about confidentiality and privacy legislation, and the need for training modules about elder abuse to be developed at the national level:
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2.109 | In evidence to the Committee, the ABA also commented on the work being done with the Western Australian Government and indicated that a national approach would be desirable, including a national awareness-raising campaign, and that their members ‘could facilitate getting information through to customers... The other side obviously is in relation to informing bank staff.’114 |
2.110 | Recommendation 5The Committee recommends that the Australian Government work in cooperation with the banking and financial sector to develop national, industry-wide protocols for reporting alleged financial abuse and develop a training program to assist banking staff to identify suspicious transactions. The experience of Canada in this area should be drawn on in developing such protocols. |
2.111 | Under existing legislation in Western Australia, where an individual does not have capacity or there are concerns in that area, banking institutions can report their concerns to the Public Advocate; if they think the person has capacity, they would take their concerns to Advocare, a non-government organisation funded by the federal Department of Health and the WA Department of Health, through the Home and Community Care program. There is a protocol between the Public Advocate and Advocare to refer matters to each other if they feel it necessary.115 |
2.112 | In contrast, in South Australia, the Public Advocate indicated that:
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2.113 | The Committee believes that a more uniform approach should be pursued among the states and territories, in line with the Western Australian model. |
2.114 | Recommendation 6The Committee recommends that the members of the Australian Guardianship and Administration Committee examine the Western Australian legislation relating to reporting by banks and other financial institutions of suspected abuse to the Public Advocate and Advocare, and develop similar initiatives for consideration by their respective state and territory governments. |
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Education and awareness campaigns
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2.115 | Increasing education and raising public awareness are central to preventing and responding to financial abuse and fraud. National Seniors indicated that ‘the most effective tool for identifying, preventing and treating elder abuse’ was public awareness.118 The Committee heard that education in this area should focus on both older people vulnerable to financial abuse and potential abusers. The NSW MACA told the Committee that:
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2.116 | On specific consumer issues, the Committee is aware that consumer protection authorities in many states and territories are already undertaking consumer protection education activities, providing consumers with advice and information on a number of key areas such as banking, cold calling, door-to-door sales, internet and mail order shopping, investments and scams.120 |
ASIC has a role in educating consumers of financial services:
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2.118 | One of ASIC’s six priorities for the coming year is to ‘develop initiatives to assist retail investors to better manage and protect their investment’s wealth, with a particular focus on the needs of retirees and baby boomers who are soon to become retirees... Those initiatives will include work to better educate consumers about the importance of diversification and what this involves and the issue of the risk-return premium’.122 |
2.119 | The ACCC has an Infocentre hotline accessible to all consumers, and in addition provides material via its web site and in a range of publications to promote consumer education and awareness.123 The SCAMwatch website in particular aims to warn consumers about common scams and how ‘to recognise, avoid and report scams’.124 |
2.120 | The Committee endorses the observation of the AIC that:
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2.121 | Despite the work that is currently being undertaken in this area, the Committee sees merit in a campaign along the lines of the domestic violence campaign, to raise public awareness about the wider issue of elder abuse. In evidence to the Committee, Mr Peter Brady, National Policy Manager, argued:
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2.122 | The Committee sees merit in a campaign along the lines of the domestic violence campaign, in raising awareness of the general public about the wider issue of elder abuse. |
2.123 | Recommendation 7The Committee recommends that the Australian Government, in consultation with states and territories, undertake a national awareness campaign dealing with financial abuse of older Australians, and the bodies responsible for investigating such abuse. |
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Financial literacy |
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2.124 | Financial literacy has been defined as ‘[t]he ability to make informed judgements and to take effective decisions regarding the use and management of money’.127 This is a skill needed by all sections of the community, not just older people. Unfortunately the Committee heard that despite financial education and assistance being available, it often is not sought until abuse has occurred:
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2.125 | The Financial Literacy Foundation was established in 2005 to assist all Australians and provide them with an opportunity to increase their financial knowledge and better manage their money. Located within the Department of the Treasury, the Foundation has four key aims:
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2.126 | Mr McCray, from the Foundation, noted that several aspects of its work target older Australians:
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2.127 | As Mrs Josephine Smyth observed, ‘I think the matter of financial literacy is something that is vital... I stress the point that older people must take responsibility for their own actions: they must become more financially literate...’.131 |
2.128 | The Victorian Government recommended:
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2.129 | The Committee believes that ensuring people have the skills necessary to manage their finances effectively and avoid being defrauded is central to the prevention of financial abuse. The Committee supports the proposal for a national financial literacy program for older Australians. In addition to providing targeted financial advice, such a campaign should inform older people of the processes by which they can seek recourse after abuse has occurred and the regulatory bodies who have the power to investigate and prosecute misleading and deceptive practices.132 |
2.130 | Recommendation 8The Committee recommends that the Australian Government, in conjunction with states and territories, continue to fund and develop national initiatives to promote financial literacy particularly among older people and those approaching retirement age. |
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Other issues |
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2.131 | During the course of the inquiry, the Committee was made aware of a number of other areas of potential financial risk for older people. While these may not always be fraudulent activities or examples of financial abuse as such, they do have the potential to impact on the financial well-being of older Australians. These areas are discussed below. |
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Equity release schemes |
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2.132 | Equity release products are a class of products that include reverse mortgages, home reversion schemes and shared appreciation mortgages. In brief these involve:
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2.133 | ASIC notes that the market for the most common of equity release products, that of reverse mortgages, is ‘burgeoning’.134 A survey undertaken by Trowbridge Deloitte on behalf of the Senior Australian Equity Release Association of Lenders (SEQUAL), released in April 2007, found that market growth over the past year was at 80 per cent, with $520 million worth of settlements in 2006 (compared with $315 million in 2005). Also of interest, the study found:
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2.134 | From evidence to the Committee it appears that the exact nature of a number of products on offer is not always explained to potential consumers, with some products being described as reverse mortgages when they are in fact quite different. The Consumer Credit Legal Centre (NSW) Inc (CCLC) warned that:
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2.135 | This was supported by the findings of a recent report by Choice magazine. It found that in some cases, ‘consumers enquiring about reverse mortgages were offered very high risk “asset loans” instead’.137 |
2.136 | A number of submissions commented on positive aspects of reverse mortgages, provided that the consumer was aware of the exact nature of the product and had appropriate legal advice. For example, the Council on the Ageing SA noted:
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2.137 | In a 2005 report ASIC concluded that ‘while equity release products could provide a useful and legitimate tool to meet the needs of some consumers, they also involved significant risk’.139 Of particular concern to ASIC were issues involving negative equity, terms and conditions, access to advice for consumers, the potential impact on Centrelink benefits, and fees associated with some products.140 ASIC also pointed to overseas experience, in particular that of the UK where ‘there was heavy promotion of reverse mortgages to retirees in the 1980s. But when prices moved against consumers and their debt exceeded the value of their homes, many were evicted’.141 |
2.138 | SEQUAL was formed in January 2005 by a number of financial institutions offering these products. All members are required to adhere to a code of conduct which includes:
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2.139 | In recognition of ‘the importance of educating intermediaries on the unique characteristics of reverse mortgages’ and given the growth of mortgage brokers and financial planners, SEQUAL has established an accreditation standard and has accredited two courses (offered by the Mortgage and Finance Association of Australia and Bluestone Equity Release) which offer specialised training on reverse mortgages to intermediaries.143 |
2.140 | Despite the laudable efforts of organisations such as SEQUAL, bodies such as National Seniors Association do not believe that the ‘current regulatory framework provides sufficient protection for older people or requires providers to fully inform consumers of the pros and cons of the product... it does not seem... [that self-regulatory initiatives]... have managed to deter unscrupulous operators from the marketplace or result in greater community awareness of the benefits and drawbacks of reverse mortgages’. National Seniors Association called for more effective regulation of the reverse mortgage industry, so that:
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2.141 | The Law Institute of Victoria argued that the requirement for independent legal advice should be mandatory for all providers of equity release products.145 Caxton Legal Centre also noted that ‘of particular concern to us... [was] ...the marketing and use of products such as Reverse Mortgages to elderly clients, without adequate information regarding the cost of the product/alternative products. Disclosure obligations associated with reverse mortgages should be made more stringent’.146 |
2.142 | Membership of SEQUAL is voluntary, and therefore the code of conduct is not followed by all lenders.147 ASIC also noted that ‘most of the lenders in this area do not tend to be mainstream banks; they tend to be other sorts of lenders-mortgage originators and so on.’148 |
2.143 | Concern was expressed even about those adhering to the SEQUAL code. Choice magazine rated the ‘no negative equity guarantee’ as the most important protection measure offered with these products. While all companies assessed by Choice offer a ‘no negative equity’ guarantee, most contracts indicate ‘they may not honour it if you are in default at the time of sale’.149 Similarly:
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2.144 | In regard to regulation of equity release products, the UCCC regulates product disclosure of all credit products, including reverse mortgages. Such products are not considered to be financial products and are therefore not subject to ASIC regulation and the products are available not only from financial planners but also mortgage brokers. |
2.145 | The 2005 report by ASIC noted that the existing regulatory system was not designed to address the issues raised by equity release products ‘which take the form of credit arrangements but nevertheless have some of the attributes of an investment product’:
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2.146 | The regulation of consumer credit, including the activities of mortgage brokers, is the responsibility of state and territory governments. In September 2006 the Ministerial Council for Consumer Affairs agreed to a uniform approach to the regulation of mortgage brokers. This will involve the imposition of licensing, conduct and disclosure requirements on brokers. A draft bill, for use by all other states, is being prepared by the New South Wales Government and its release is imminent. The Commonwealth Treasurer has recently called on the states ‘to accelerate work on the licensing conduct and disclosure of mortgage brokers’.152 The Committee supports the introduction of licensing of mortgage brokers as quickly as possible. |
2.147 | From a wider perspective than just equity release products, it was noted that:
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2.148 | ASIC itself in its 2005 report on equity release products agreed that the Code does not cover some new products:
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2.149 | With the growth in this type of product, the Committee believes that it would be timely for states and territories to review the UCCC. |
2.150 | Recommendation 9The Committee recommends that the Ministerial Council on Consumer Affairs undertake a review of the Uniform Consumer Credit Code, in light of the new range of products and services available in the market. |
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Targeting of older people for unsecured risky investments |
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2.151 | While older Australians are only half as likely as younger people to be victims of most types of consumer fraud, in relation to ‘investment and insurance fraud... older Australians experience a higher incidence of victimisation than younger Australians.’155 |
2.152 | Following recent legislative changes, from 1 July 2007 Australians aged 60 years and over have the opportunity to withdraw their superannuation savings at retirement as a tax-free lump sum. ASIC has warned that ‘[t]hose accessing their funds in this way will need to be especially cautious about decisions relating to their retirement funding, to ensure it lasts as long as they do’.156 |
2.153 | There may well be a ‘desire to improve retirement living standards... [resulting] in a growing willingness of older Australians to experiment with their retirement savings by investing in risky schemes, or complex financial products’. ASIC noted that it was aware of ‘scams, illegal schemes and high-risk investment ventures that have been aggressively marketed to target older Australians over recent years’.157 |
2.154 | A number of highly publicised collapses of investment schemes, such as Westpoint and Fincorp, have been well-documented and are the subject of ongoing investigation by regulators. It is beyond the scope of this report to examine the reasons for those collapses. The Committee notes, however, that ASIC is currently ‘in the process of an extremely large and complex investigation into the affairs of the Westpoint Group and the role and conduct of not only the directors of the Group, but also of the licensed and unlicensed advisers’.158 Similar activity is underway in regard to other corporate collapses. |
2.155 | These collapses affected not just older investors, but they are a significant percentage of those caught up in the collapses. As part of its investigation into the Westpoint collapse, ASIC conducted a survey of known investors. Of the 1,800 responses received, approximately one-third were self-funded retirees and the average age of investors was almost 60.159 The impact of such collapses on older investors has been well documented.160 |
2.156 | As noted earlier:
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2.157 | One of ASIC’s key priorities over the next 12 months and beyond is to ‘focus on the education of retail investors... [with particular emphasis on] strategies which aim to improve quality of advice, and the level of investor education in relation to diversifying risk through asset allocation, and understanding the relationship between risk and return for particular asset classes such as debt securities. ASIC also intends to focus attention on simpler, better-targeted disclosure; advertising of complex investment products targeted to retail investors; and, early detection and elimination of illegal operators’.162 |
2.158 | It is clear to the Committee that the role of ASIC is not generally well understood. ASIC described its role in the following terms:
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2.159 | As Mr A Sher observed:
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2.160 | It was also put to the Committee that ‘a lot of people will think that, because the regulator is involved, it has actually looked at this. People think things are safe because ASIC has looked at them. Most people think that, if these things have gone into ASIC, they must be okay. But it is the opposite...’165 |
2.161 | The role of ASIC and other regulators needs to be better explained to the general public and improved education of investors (see Recommendation 8) should assist in this regard. |
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Guarantees |
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2.162 | It is human nature to want to assist family members in a range of areas. Concern has been expressed at the possible abusive nature of such assistance, particularly in the area of older Australians acting as guarantor for family members. The Law Society of Western Australia identified a number of areas where fraud and financial abuse might occur, including where younger family members might ask older family members to guarantee their personal or home loans:
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2.163 | The Human Rights and Equal Opportunity Commission (HREOC) also raised concerns about older people being pressured into acting as guarantors, while acknowledging the need and desire of older people to assist family members in financial ways. HREOC indicated it would be:
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2.164 | The Committee notes that there have been a number of cases involving guarantors ‘with an emotional dependence on the borrower such as parents of adult borrowers’, with mixed legal outcomes.168 For most reputable lenders, it is now common practice to ensure that separate independent legal advice is available for borrowers and guarantors to ensure that they understand the nature of the commitment they are signing. However, as with other aspects of consumer credit arrangements, a small percentage of providers are not following best practice. Others seek to alter the nature of the arrangements to avoid those protections that are in place. |
2.165 | In regard to guarantees, while they were still available, CCLC found:
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2.166 | The Committee hopes that the proposed licensing and registration of mortgage brokers (see paragraph 2.146) will also assist in addressing this issue. |
2.167 | The Country Women's Association proposed that those who act as guarantors should be kept informed of progress with the transaction so that they had early advice if anything was starting to go wrong:
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2.168 | The Committee is attracted to this proposal, as one way of assisting those who are willing to act as guarantors retain some degree of control and knowledge about the undertaking. |
2.169 | Recommendation 10The Committee recommends that the Treasurer, in conjunction with his state and territory counterparts, initiates discussions with credit providers to mandate that guarantors be advised regularly of the progress with the loans they have provided surety for, and notified should any default occur. Such guarantees should not be enforceable if this advice has not been provided. |
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Credit |
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2.170 | The Committee also received evidence of irresponsible lending by credit card providers that, it was argued, in some cases amounted to financial abuse.171 While such behaviour also affects other sections of the community, the ability of older Australians to meet their financial commitments is more limited as many are no longer fully employed. |
2.171 | The CCLC argued that lenders have a duty of care to borrowers to lend responsibly and that there is ‘no real or effective penalty for irresponsible lending’.172 |
2.172 | While the Committee acknowledges that poor financial skills and money management by individuals can result in unmanageable debt levels, it is clear that lending practices undertaken by some financial institutions exacerbate problems for certain sections of the community. Figure 2.2 Case studies: Credit card debtMr H was working earning $25,000 p.a. He owns his own home. He has $43500 in credit card debt. The credit card was used...[for] strata management fees and to buy household goods. Now he is on the aged pension and cannot afford to pay the credit card. The bank has suggested he get a reverse mortgage to pay the credit card debt...In 1998 Mrs C applied for a credit card with a bank. She declared on the application form that her sole source of income was Centrelink benefits. The application was declined. She queried this and then the bank offered her a credit card with a limit of $3000. Through unsolicited limit increases the limit on her credit card was increased from $5000 to $7000 to $10000 to $15000 to $25000 to $35000 to $45000. Mrs C has no way to repay the debt... |
2.173 | It was put to the Committee that action should be taken on unsolicited credit limit increases:
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2.174 | The Committee understands that, at least as far as major financial institutions are concerned, there has been a move away from automatic credit card increases. While offers may be made to individual customers, based on their credit history, it is up to the customer to accept the increased limit or not.175 |
2.175 | While the Committee has no objection to banks and other financial institutions making such offers to customers, it believes that the Government should consider a ban on unsolicited automatic credit limit increases. |
2.176 | Recommendation 11The Committee recommends that the Australian Government consider a ban on unsolicited automatic credit limit increases. |
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Charities and churches |
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2.177 | Concerns were raised with the Committee about the operations of some charities and churches in targeting vulnerable older Australians:
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2.178 | It was suggested that the ‘Do Not Call’ register should be extended to religious organisations and charities to increase protection for vulnerable older persons.177 While the Committee has some sympathy with this view, the effectiveness of the ‘Do Not Call’ register as it currently operates has not yet been formally assessed. |
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Centrelink arrangements |
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2.179 | The Committee received a number of comments critical of the way in which the Centrelink nominee arrangements interact with guardianship arrangements or powers of attorney. These are dealt with in more detail in Chapter 3. Concerns were also raised about the potential for financial abuse by people holding nominee authority on behalf of Centrelink clients:
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2.180 | As at 20 July 2007, there were 347,047 nominee arrangements in place (25,753 payment arrangements; and 285,398 correspondence only arrangements; and 35, 896 with both payments and a correspondence nominee arrangement in place).179 Of these only 2.5 per cent of the total 347,047 are court appointed, and the figure rises to only 4 per cent when those operating under a power of attorney arrangement are considered.180 |
2.181 | When asked whether Centrelink monitored nominee arrangements for potential abuse, the response was that ‘as part of the arrangements we do not, no, but we do have existing procedures in place’, and that they would act on any instances of abuse they would encounter.181 |
2.182 | Centrelink have advised that there is no set schedule for reviews of nominee arrangements. ‘The regular review framework for Centrelink payments varies from payment to payment’.182 While Centrelink documents state that a payment nominee must keep records detailing how payments have been spent, and ‘respond to a request by Centrelink to provide records of how... payments have been used’183 it also indicated ‘there is no set schedule for these reviews. This would form part of our ongoing review framework that we have within Centrelink with respect to reviewing people’s circumstances so as to ensure that their entitlements are correct’.184 |
2.183 | Centrelink believes that the level of abuse of nominee arrangements is very low.185
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2.184 | A Centrelink representative noted that ‘[w]e do not ignore those cases when we come into contact with them, but it is probably fair to say that, with a large number of our customer group in the age pension group, we are not in regular contact with them in the same way that we would be with Centrelink’s working-age customers, who we have on regular two-week reporting and we are actively engaged with them’.187 |
2.185 | While the Committee would not support instituting such a level of contact with those with nominee arrangements in place, it does remain concerned that such nominee arrangements, particularly those that are for both payment and correspondence, are not monitored in any systematic way. The Committee would like to see Centrelink, as part of its duty of care to its clients, institute a regular review schedule so that a representative sample of nominee arrangements in each year are reviewed each year to determine that the payments are being appropriately used. The nominee arrangements need not include those where a public trustee or financial manager has been appointed by a Guardianship Board or Tribunal under state/territory legislation, as some form of recording of expenditure activity is already in place and there are mechanisms for raising concerns about such arrangements. |
2.186 | Recommendation 12The Committee recommends that Centrelink establish a process by which a representative sample of nominee arrangements in each year (other than those established by order of a guardianship tribunal or other similar body) are examined to determine that the payments are being used appropriately. |
2.187 | The Committee was also advised of difficulties faced by older Australians who may have invested in financial schemes or businesses that subsequently collapsed.188 Although they were no longer receiving a return from their investment, under social security laws they were deemed to still be in receipt of an income, and in possession of an asset. |
2.188 | The Committee raised this with Centrelink officials, who advised that there were mechanisms to waive the deeming provisions, and that this had occurred in a number of high profile recent cases:
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2.189 | The Committee does not have all of the private financial information relating to the individuals who made claims that they were ineligible for any Centrelink assistance. However, the Committee remained concerned that the actual experience of the application of hardship provisions was different from the policy intent as described by Centrelink officials. |
2.190 | It is the experience of the Caxton Legal Service that ‘Centrelink can be very difficult to engage in these types of matters and that the hardship test is applied very rarely’.190 The Centre would like to see changes to the hardship test to enable Centrelink to ‘recognize victims of elder abuse and to enable greater latitude in situations where the elderly person may have been subjected to undue influence in the way they have arranged their affairs and where they meet certain other requirements. Centrelink should also undertake training to ensure that their staff is aware of the prevalence of elder abuse to enable their officers to recognise the signs’.191 |
2.191 | Recommendation 13The Committee recommends that Centrelink, in consultation with the Department of Families, Community Services and Indigenous Affairs, review the application of the ‘hardship’ provisions as they apply in particular to older Australians who have suffered financial abuse or fraud. |
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Life insurance and superannuation issues |
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2.192 | The Committee received a submission from Mrs Janne van Wulfften Palthe regarding the dispersal of benefits from superannuation and life insurance policies. While not specifically limited to older people, the matter nevertheless has the potential to impact on this particular demographic group. |
2.193 | Ms van Wulfften Palthe indicated that, contrary to what she believes most people understand, the making of a will cannot alter the beneficiary nominated in a life insurance or superannuation policy. This can lead to significant financial and emotional stress when, following a death, the beneficiaries of the will may find that they are not listed as beneficiaries of the life insurance or superannuation and have no claim on it. |
2.194 | Ms van Wulfften Palthe indicated that people are unaware of the requirement to change the beneficiary details with the company concerned, and often do not realise that they may have failed to reflect changed personal circumstances in this way (due to the passage of time since taking out the policy), or believe that a later will overrides such a nomination.192 Mrs van Wulfften Palthe called for a change in the law so that ‘wills should be able to overwrite life insurance and superannuation designations’,193 and that both superannuation and life insurance can be left in a will. |
2.195 | Under current legislation, the proceeds of a person’s life policy ‘may be paid to the person’s trustee or executor upon death, or to a nominated beneficiary under the terms of the policy (in which case the proceeds do not form part of the deceased estate) or to an assignee of the policy...’194 |
2.196 | Mrs van Wulfften Palthe raised her concerns with the Treasurer. In a response from an adviser to the Minister for Revenue and Assistant Treasurer, it was stated:
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2.197 | Mrs van Wulfften Palthe advised the Committee that there is ‘no requirement by life insurance or superannuation companies to detail the beneficiary or spell out how beneficiaries should be changed’196 although from the above comments it is clear that some companies already do this. |
2.198 | The Committee acknowledges that the level of public knowledge about this issue is likely to be limited as most of the members of the Committee were themselves unaware of the issues this might raise on the death of an individual. Given the low number of Australians who actually make wills, the Committee does not support a change in legislation to allow wills to override nominated beneficiary arrangements in superannuation and life insurance policies. However, the Committee does support the beneficiary details being included on policy renewal documents and/or annual statements as suggested. |
2.199 | Recommendation 14The Committee recommends that the Australian Government work with superannuation and life insurance companies to provide for regular notification to policy holders of the beneficiary details and the way in which those details can be amended. |
2.200 | There is also an issue with superannuation death benefits and binding death benefit nominations. As Mr Brian Herd, a legal practitioner, explained:
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2.201 | Mr Herd suggested that the Superannuation Industry (Supervision) Act 1993 be amended to enable a substitute decision maker to make or renew a binding death benefit nomination.198 |
2.202 | The Committee supports this proposal. |
2.203 | Recommendation 15The Committee recommends that the Australian Government introduce legislation into Parliament to amend the Superannuation Industry (Supervision) Act 1993 to enable a substitute decision maker to renew, or if required to do so, to make a binding death benefit nomination. |
1 | Council on the Ageing SA, Submission No. 77, p. 2. Back |
2 | AIC, Submission No. 40, p. 1. Back |
3 | AIC, Submission No. 40, p. 1. Back |
4 | AIC, Exhibit No. 48. See also Victim Support Service Inc, Submission No. 150, p. 2, and Transcript of Evidence, 31 July 2007, p. 29. Back |
5 | Council on the Ageing SA, Submission No. 77, p. 12. Back |
6 | AIC, Submission No. 40, p. 1. Back |
7 | AIC, Submission No. 40, p. 3. Back |
8 | AIC, Submission No. 40, p. 1. Back |
9 | AIC, Submission No. 40, p. 3. Back |
10 | Quoted in Human Rights and Equal Opportunity Commission (HREOC), Submission No. 92, p. 26. Back |
11 | Law Institute of Victoria, Submission No. 78, p. 3. Back |
12 | Victorian Government, Submission No. 121, p. 17. Back |
13 | Victorian Government, Submission No. 121, p. 17. Back |
14 | Alzheimer’s Australia, Submission No. 55, p. 18. Back |
15 | Victorian Government, Submission No. 121, p. 18. Back |
16 | Carers Queensland, Submission No. 81, p. 2. Back |
17 | AIC, Submission No. 40.1, p. 1. Back |
18 | National Seniors, Submission No. 67, p. 7. See also Office of the Public Advocate, Queensland, Submission No. 76, p. 2; ASIC, Submission No. 127, p. 10; Victorian Government, Submission No. 121, p. 16. Back |
19 | Dr Barbara Black, Alliance for the Prevention of Elder Abuse, WA, Transcript of Evidence, 30 July 2007, p. 50. See also Western Australian Government, Submission No. 74, p. 4. Back |
20 | See for example, Western Australian Government, Submission No. 74, p. 4. Also, Ms Michelle Scott, Public Advocate, Western Australia, Transcript of Evidence, 30 July 2007, p. 14. Back |
21 | COTA Over 50s, Submission No. 58, p. 6. Back |
22 | ASIC, Submission No. 127, p. 10. See also Law Institute of Victoria, Submission No. 78, p. 3; HREOC, Submission No. 92, p. 24 and p. 28. Back |
23 | HREOC, Submission No. 92, p. 28. Back |
24 | Smith, R., ‘Consumer scams in Australia: an overview’, AIC publication, February 2007, Exhibit No. 146, p. 2. Back |
25 | National Seniors, Submission No. 67, p. 7. Back |
26 | AIC, Submission No. 40, p. 2. See also Public Trustee NSW, Submission No. 72, p. 1; Trustee Corporations Association of Australia, Submission No. 68, p. 2. Back |
27 | AIC, Submission No. 40, p. 3. Back |
28 | Country Women’s Association of NSW, Submission No. 18, p. 2. Back |
29 | Country Women’s Association of NSW, Submission No. 18, pp. 2-3. Back |
30 | AIC, Submission No. 40, p. 3. Back |
31 | ASIC, Submission No. 127, p. 13. Back |
32 | Quoted in Queensland Attorney-General, Submission No. 107, p. 2. Back |
33 | Quoted in Queensland Attorney-General, Submission No. 107, p. 2. See also Carers Queensland, Submission No. 81, p. 2. Back |
34 | Ms Anita Smith, President, Guardianship and Administration Board, Tasmania, Transcript of Evidence, 5 June 2007, p. 2. This is also in accord with comments by Mr Adam Graycar (Director of the AIC) who has been quoted as stating that powers of attorney was the most abused legal document in America, and that ‘Advocacy organisations in Australia reported similar cases of abuse in Australia’ (see Alzheimer’s Australia, Submission No. 55, p. 15). Back |
35 | Carers Queensland, Submission No. 81, p. 1. Back |
36 | Mr Graham Schlecht, Carers Queensland, Transcript of Evidence, 16 July 2007, pp. 23-24. Back |
37 | AIC, Submission No. 40, p. 5. Back |
38 | Advocare, Submission No. 71, p. 5. Back |
39 | Mr Julian Gardner, Public Advocate, Victoria, Submission No. 70, p. 7. Back |
40 | Mr Julian Gardner, Public Advocate, Victoria, Submission No. 70, p. 5. Back |
41 | Mr Julian Gardner, Public Advocate, Victoria, Submission No. 70, p. 5. See also Advocare Inc, Submission No. 71, p. 5; COTA Over 50s, Submission No. 58, p. 3. Back |
42 | ACCC, Submission No. 39, p. 4. Back |
43 | ACCC, Submission No. 39, p. 4 Back |
44 | ACCC, Submission No. 39, pp. 7-8. Back |
45 | ACCC, Submission No. 39, p. 11. Back |
46 | ACCC, Submission No. 39, pp. 13-14. Back |
47 | ACCC, Submission No. 39, p. 12 and 15. Back |
48 | ACCC, Submission No. 39, p. 8. Back |
49 | Law Society of South Australia, Submission No. 94, p. 3. Back |
50 | ACCC, Submission No. 39.1, p. 1 Back |
51 | ACCC, Submission No. 39.1, p. 2 Back |
52 | ASIC, Submission No. 127, p. 5. Back |
53 | ASIC, Submission No. 127, p. 6. Back |
54 | AIC, Submission No. 40, p. 9. Back |
55 | See for example Law Society of South Australia, Submission No. 94, p. 5; Mr Julian Gardner, Public Advocate, Victoria, Submission No. 70, p. 7; Assets and Ageing Research Team, University of Queensland, Submission No. 26, p. 3. Back |
56 | Alzheimer’s Australia, Submission No. 55, p. 17. Back |
57 | Mr Julian Gardner, Public Advocate, Victoria, Submission No. 70, p. 4. Back |
58 | Professor Jill Wilson, Assets and Ageing Research Team, University of Queensland, Transcript of Evidence, 16 July 2007, p. 67. Back |
59 | AIC, Submission No. 40, p. 6. Back |
60 | Office of the Public Advocate, Queensland, Submission No. 76, p. 4. See also Elder Abuse Prevention Unit, Submission No. 97, p. 6, which had reports through its helpline that ‘Most callers in these situations have been advised by police to take legal action i.e. sue the son or daughter as the weight of evidence is less’. Also, Mr David Walsh, Transcript of Evidence, 23 March 2007, pp. 39-40. Back |
61 | Mrs Amanda Hess, Caxton Legal Centre Inc, Transcript of Evidence, 16 July 2007, p. 20. Back |
62 | Aged Rights Advocacy Service Inc, Submission No. 38, p. 7. Back |
63 | AIC, Submission No. 40, p. 8. Back |
64 | Law Society of South Australia, Submission No. 94, p. 1. Back |
65 | Assets and Ageing Research Team, University of Queensland, Submission No. 26, pp. 2-3. Back |
66 | The Law Institute of Victoria, Submission No. 78, p. 5. Back |
67 | Mr David Walsh, Transcript of Evidence, 23 March 2007, p. 32. See also Ms Lillian Jeter, Elder Abuse Prevention Association, Transcript of Evidence, 4 June 2007, p. 86. Back |
68 | Victorian Government, Submission No. 121, p. 3. Back |
69 | AIC, Submission No. 40, p. 8. Back |
70 | Council on the Ageing SA, Submission No. 77, p. 8. See also NSW Ministerial Advisory Committee on Ageing, Submission No. 103, p. 2. Back |
71 | National Legal Aid, Submission No. 99, p. 7. Back |
72 | National Legal Aid, Submission No. 99, p. 8. Back |
73 | NSW MACA, Submission No. 103, p. 2. Back |
74 | Mr Bill O’Shea, Law Institute of Victoria, Transcript of Evidence, 4 June 2007, p. 14. Back |
75 | Mr Anthony Fitzgerald, State Trustees Ltd, Transcript of Evidence, 4 June 2007, p. 76. Back |
76 | See for example Mrs Berryl Glasson, Submission No. 131; Mr Peter Neil, Submission No. 134. Back |
77 | Mrs Berryl Glasson, Submission No. 131, p. 1. Back |
78 | Mr Peter Neil, Transcript of Evidence, 30 July 2007, p. 57. Back |
79 | Country Women’s Association of NSW, Submission No. 18, p. 3. Back |
80 | Catholic Women’s League Australia Inc, Submission No. 27, pp. 6-7. Back |
81 | Mrs Patricia Shergis, Country Women’s Association of NSW, Transcript of Evidence, 15 May 2007, p. 58. Back |
82 | Mr Greg Tanzer, ASIC, Proof Transcript of Evidence, 17 August 2007, p. 15. Back |
83 | Mr Julian Gardner, Public Advocate, Victoria, Submission No. 70, p. 3. Back |
84 | Elder Abuse Prevention Association, Submission No. 132, p. 3. Back |
85 | Ms Lillian Jeter, Elder Abuse Prevention Association, Transcript of Evidence, 4 June 2007, p. 87. Back |
86 | American Bar Association, ‘Statutory Provisions authorizing and defining threshold eligibility for adult protective services by state’, available at www.elderabusecenter.org (accessed 28 August 2007). Back |
87 | American Bar Association Commission on Law and Ageing, Information about laws related to Elder Abuse, available at www.elderabusecenter.org (accessed 28 August 2007). Back |
88 | Ms Patricia Reeve, Council on the Ageing Over 50s, Proof Transcript of Evidence, 17 August 2007, p. 5. Back |
89 | Western Australian Government, Submission No. 74, p. 7. Back |
90 | Ms Anita Smith, President, Guardianship and Administration Board, Tasmania, Transcript of Evidence, 5 June 2007, p. 8. Back |
91 | Mr John Harley, Public Advocate, SA, Transcript of Evidence, 31 July 2007, p. 5. Back |
92 | Ms Michelle Scott, Public Advocate, Western Australia, Transcript of Evidence, 30 July 2007, p. 18. Back |
93 | Professor Jill Wilson, Assets and Ageing Research Team, University of Queensland, Transcript of Evidence, 16 July 2007, p. 62. Back |
94 | AIC, Submission No. 40.1, pp. 3-4. Back |
95 | Department of Health and Ageing, Submission No. 111, p. 3. Back |
96 | EAPU, Submission No. 97, p. 2. Back |
97 | ANPEA brochure, available at http://www.agedrights.asn.au/pdf/ANPEA%20Brochure%20June%2007.pdf (accessed 3 September 2007). Back |
98 | Elder Abuse Prevention Unit, Submission No. 97, p. 1. Back |
99 | Public Trustee NSW, Submission No. 72, p. 2. See also Mr Julian Gardner, Public Advocate, Victoria, Submission No. 70, p. 9; Alliance for the Prevention of Elder Abuse: Western Australia, Submission No. 114, p. 4. Back |
100 | Mr Ian Gilbert, ABA, Proof Transcript of Evidence, 17 August 2007, p. 60. Back |
101 | Caxton Legal Centre Inc, Submission No. 112, p. 19. Back |
102 | Mr Brian Herd, Transcript of Evidence, 16 July 2007, p. 9. Back |
103 | Mr Brian Herd, Transcript of Evidence, 16 July 2007, p. 9. Back |
104 | Mr Ian Gilbert, ABA, Proof Transcript of Evidence, 17 August 2007, p. 60. Back |
105 | Office of the Public Advocate, Queensland, Submission No. 76, p. 3. Back |
106 | AIC, Submission No. 40, p. 8. Back |
107 | Mr Julian Gardner, Public Advocate, Victoria, Submission No. 70, p. 9. Back |
108 | Zanin, B.,’ Helping Seniors Help Themselves’, Exhibit No. 49. Back |
109 | Dr Russell Smith, AIC, Transcript of Evidence, 23 March 2007, p. 22. See also Victorian Government, Submission No. 121, p. 19; Caxton Legal Centre Inc, Submission No. 112, p. 13. Back |
110 | See for example, Western Australian Government, Submission No. 74, p. 5; Council on the Ageing SA, Submission No. 77, p. 8. Back |
111 | Western Australian Government, Submission No. 74, p. 5. Back |
112 | Mr Peter Arnaudo, Attorney-General’s Department, Proof Transcript of Evidence, 17 August 2007, p. 47. Back |
113 | Mr Stephen Boylen, Transcript of Evidence, 30 July 2007, p. 2. In contrast to the Western Australian experience, some other banking authorities have been less cooperative. See for example, Professor Jill Wilson, Assets and Ageing Research Team, University of Queensland, Transcript of Evidence, 16 July 2007, p. 62. Back |
114 | Mr Ian Gilbert, ABA, Proof Transcript of Evidence, 17 August 2007, p. 63. Back |
115 | Ms Michelle Scott, Public Advocate, Western Australia, Transcript of Evidence, 30 July 2007, p. 16. Back |
116 | Mr John Harley, Public Advocate, SA, Transcript of Evidence, 31 July 2007, p. 2. Back |
117 | Victorian Government, Submission No. 121, p. 3. Back |
118 | National Seniors, Submission No. 67, p. 8. See also Assets and Ageing Research Team, University of Queensland, Submission No. 26, p. 4. Back |
119 | NSW MACA, Submission No. 103, pp. 2-3. Back |
120 | See for example, Western Australian Government, Submission No. 74, p. 14. Back |
121 | ASIC, Submission No. 127, p. 5. Back |
122 | Mr Greg Tanzer, ASIC, Proof Transcript of Evidence, 17 August 2007, p. 11. Back |
123 | ACCC, Submission No. 39, p. 9. Back |
124 | ACCC, Submission No. 39, p. 11. Back |
125 | AIC, Submission No. 40, p. 2. Back |
126 | Mr Peter Brady, National Seniors Association, Transcript of Evidence, 22 May 2007, p. 21. An education campaign along the lines of the national domestic violence campaign was also supported by Caxton Legal Centre – see Transcript of Evidence, 16 July 2007, p. 19; the Alliance for the Prevention of Elder Abuse WA, Transcript of Evidence, 30 July 2007, p. 51. Back |
127 | Quoted in ASIC, Submission No. 127, p. 13. Back |
128 | Country Women’s Association of New South Wales, Submission No. 18, p. 3. Back |
129 | Mr Peter McCray, Financial Literacy Foundation, Transcript of Evidence, 23 March 2007, p. 50. Back |
130 | Mr Peter McCray, Financial Literacy Foundation, Transcript of Evidence, 23 March 2007, p. 51. Back |
131 | Mrs Josephine Smyth, Transcript of Evidence, 16 July 2007, p. 33. Back |
132 | National Seniors, Submission No. 67, p. 6. See also NSW MACA, Submission No. 103, p. 2. Back |
133 | ASIC, Report 59, Equity release products, November 2005, p. 4. Note, there are currently no SAM products available in the Australian market (see www.fido.gov.au/fido/fido.nsf/byheadline/Equity+release?openDocument (accessed 27 August 2007)) Back |
134 | ASIC, Submission No. 127, p. 21. Back |
135 | Report available at http://www.sequal.com.au/images/stories/sequal_trowbridge_deloitte_research_release_april_2007.doc (accessed 27 August 2007) Back |
136 | CCLC, Submission No. 59, p. 3. Back |
137 | Choice magazine, March 2007, ‘Trading your home for a holiday’. Back |
138 | Council on the Ageing SA, Submission No. 77, p. 5. See also Mr P Brady, National Seniors Association, Transcript of Evidence, 22 May 2007, p. 19. Back |
139 | ASIC, Submission No. 127, p. 22. Back |
140 | ASIC, Submission No. 127, pp. 22-23. See also Department of Communities, Queensland, Submission No. 96, p. 2. Back |
141 | www.fido.gov.au/fido/fido.nsf/byheadline/Equity+release?openDocument (accessed 27 August 2007) Back |
142 | SEQUAL Code of Conduct, http://www.sequal.com.au/images/stories/sequal_conduct_code.pdf (accessed 27 August 2007) Back |
143 | See http://www.sequal.com.au/images/stories/sequal_trowbridge_deloitte_research_release_april_2007.doc (accessed 27 August 2007) Back |
144 | National Seniors Association, Exhibit No. 57, pp. 1-2. Back |
145 | Law Institute of Victoria, Submission No. 78.1, p. 2. Back |
146 | Caxton Legal Centre Inc, Submission No. 112, p. 20. Back |
147 | Law Society of Western Australia, Submission No. 50, p. 2. Back |
148 | Mr Greg Tanzer, ASIC, Proof Transcript of Evidence, 17 August 2007, p. 16. Back |
149 | Choice, March 2007, p. 13. Back |
150 | Choice, April 2007, p. 13. Back |
151 | ASIC, Report No. 59, Equity release products, November 2005, pp. 8-9. Back |
152 | Press release: Commonwealth Treasurer, Regulation of Mortgage Brokers, 19 August 2007, available at www.treasurer.gov.au/tsr/content/pressreleases/2007/077.asp (accessed 27 August 2007). Back |
153 | Western Australian Government, Submission No. 74, p. 9. See also Ms Karen Cox, Consumer Credit Legal Centre (NSW) Inc, Transcript of Evidence, 14 May 2007, p. 14; Ms Helen Campbell, Redfern Legal Service, Transcript of Evidence, 14 May 2007, p. 27. Back |
154 | ASIC, Report No. 59, Equity Release Products, November 2005, p. 41. Back |
155 | ASIC, Submission No. 127, p. 11. Back |
156 | ASIC, Submission No. 127, p. 15. Back |
157 | ASIC, Submission No. 127, p. 19. Back |
158 | ASIC, Submission No. 127, p. 19. Back |
159 | ASIC, Submission No. 127, p. 19. Back |
160 | See for example, National Seniors, Submission No. 67, p. 7. Back |
161 | Western Australian Government, Submission No. 74, p. 10. Back |
162 | ASIC, Submission No. 127, pp. 20-21. Back |
163 | Mr Greg Tanzer, ASIC, Proof Transcript of Evidence, 17 August 2007, p. 12. Back |
164 | Mr Abraham Sher, Submission No. 98, p. 3. Back |
165 | Mr Peter Neil, Transcript of Evidence, 30 July 2007, p. 59. Back |
166 | Law Society of Western Australia, Submission No. 50, p. 1. Back |
167 | HREOC, Submission No. 92, p. 28. Back |
168 | See Lewis, R., Elder law in Australia, LexisNexis Butterworth, Chapter 4. Back |
169 | CCLC, Submission No. 59, p. 2. Back |
170 | Mrs Patricia Shergis, Country Women’s Association of NSW, Transcript of Evidence, 15 May 2007, p. 59. Back |
171 | CCLC, Submission No. 59, p. 6. Back |
172 | CCLC, Submission No. 59, p. 6. Back |
173 | CCLC, Submission No. 59, pp. 8-9. Back |
174 | Ms Karen Lane, CCLC, Transcript of Evidence, 14 May 2007, p. 13. Back |
175 | Mr David Bell, Australian Bankers Association, in House of Representatives Standing Committee on Economics, Finance and Public Administration, Transcript of Evidence, Roundtable on home loan lending practices and processes, 10 August 2007, p. 70. Back |
176 | Australian Guardianship and Administration Committee, Submission No. 73, p. 3 Back |
177 | State Trustees Ltd Victoria, Submission No. 88, p. 17. Back |
178 | EAPU, Submission No. 97, p. 5. Back |
179 | Mr Roy Chell, Centrelink, Proof Transcript of Evidence, 17 August 2007, p. 34. Back |
180 | Mr Roy Chell, Centrelink, Proof Transcript of Evidence, 17 August 2007, p. 34. Back |
181 | Mr Roy Chell and Mr Paul Cowan, Centrelink, Proof Transcript of Evidence, 17 August 2007, p. 36. Back |
182 | Centrelink, Submission No. 116, p. 1. Back |
183 | For more information, go to: http://www.centrelink.gov.au/internet/internet.nsf/MultiFilestores/mcco255/$File/mcco255_0512en.pdf (accessed 3 September 2007). Back |
184 | Mr Paul Cowan, Centrelink, Transcript of Evidence, 23 March 2007, p. 6. Back |
185 | Mr Roy Chell and Mr Paul Cowan, Centrelink, Proof Transcript of Evidence, 17 August 2007, p. 36. Back |
186 | Mr Paul Cowan, Centrelink, Proof Transcript of Evidence, 17 August 2007, p. 36. Back |
187 | Mr Paul Cowan, Centrelink, Proof Transcript of Evidence, 23 March 2007, p. 3. Back |
188 | See for example, Mrs Dorothy Lyons, Transcript of Evidence, 16 July 2007, p. 40; Mrs Betty Roberts, Catholic Women’s League Australia, Transcript of Evidence, 5 June 2007, pp. 23-25. Back |
189 | Mr Paul Cowan, Centrelink, Proof Transcript of Evidence, 17 August 2007, pp. 37-39. Back |
190 | Caxton Legal Centre Inc, Submission No. 112, p. 16. Back |
191 | Caxton Legal Centre Inc, Submission No. 112, p. 17. Back |
192 | Mrs Janne van Wulfften Palthe, Submission No. 11. Back |
193 | Mrs Janne van Wulfften Palthe, Transcript of Evidence, 4 June 2007, p. 25. Back |
194 | Rodney Lewis, Elder Law in Australia (Sydney: LexisNexis Butterworths, 2004), p. 368. Back |
195 | Letter from Ms J Hutchison, Advisor, Office of the Minister for Revenue and Assistant Treasurer, to Mrs J van Wulfften Palthe, dated 20 April 2006, Exhibit No. 59, p. 2. Back |
196 | Mrs Janne van Wulfften Palthe, Transcript of Evidence, 4 June 2007, p. 30. Back |
197 | Mr Brian Herd, Transcript of Evidence, 16 July 2007, p. 3. Back |
198 | Mr Brian Herd, Transcript of Evidence, 16 July 2007, p. 7. Back |
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