Overall, around 130,000 people in the UK over the age of 65 have reported financial abuse over the past 12 months.
A leading barrister has warned financial abuse is becoming a more “prevalent problem” and that among the most vulnerable are those diagnosed with dementia.
At an event hosted by Frenkel Topping, an adviser that manages the finances of people who are unable to act for themselves following a life-changing accident or personal injury, barrister Ruth Hughes, a specialist in wills, estates and family provision, pointed out that half of all perpetrators of financial abuse are family members.
Overall, around 130,000 people in the UK over the age of 65 have reported financial abuse over the past 12 months. Among family members, statistics show that nephews are most likely to abuse their power of attorney, thereby committing financial abuse.
It is also more common for people living in their own home to be financially abused, rather than those living in a care home.
At the event, Hughes said: “Financial abuse is becoming, sadly, an increasingly prevalent problem. People who have dementia are particularly at risk of financial abuse because they may be lonely or vulnerable – but primarily because they cannot manage their own financial affairs and thus would require a deputyship. Through that, they can be persuaded to make inappropriate gifts, wills or lasting powers of attorney.”
Hughes adds that anyone who requires a “deputy” to act on their behalf could be open to financial abuse. A professional deputy such as a lawyer or accountant can be hired. Alternatively, family members can handle the financial affairs of people with reduced capacity, as well as helping to make key decisions for them.
But Hughes warns that family members or ‘friends’ who have been given power over property and finances may abuse the trust placed in them. This trust could be abused by managing their finances or property incompetently; or by neglecting to act at all.
“Such action can mean that vulnerable people are left without the resources they need, and their quality of life is significantly reduced,” says Hughes.
Financial abuse is defined as the illegal or unauthorised use of a person’s property, money, pension book or other valuables (including changing the person's will to name the abuser as heir).
Economic abuse, on the other hand, is a form of coercive control and is a common tactic used by abusers to gain power in a relationship. Abusers use a range of methods, including controlling their victim’s money or running up debts in their name.
Under a new UK bill currently making its way through parliament, the impact of financial abuse will be legally recognised as domestic abuse and can be reported as a crime. Legal guidance for prosecutors will be changed to ensure cases of financial abuse can be successfully prosecuted where appropriate.
If you are the victim of financial or domestic abuse, you can call the 24-hour National Domestic Violence Helpline (run by Women’s Aid and Refuge) on 0808 2000 247.