The silent theft - fraud and elder financial abuse

When people think about elder abuse, they often think of physical or emotional mistreatment. However, one of the most common and fastest-growing forms of abuse experienced by older Australians is financial abuse. The consequences can be devastating, affecting not only an individual's financial security but also their dignity, independence and wellbeing.

For many older Australians, decades of careful saving have resulted in significant assets including a family home, investments, superannuation and other wealth. Unfortunately, these assets can make older people attractive targets for both scammers and, in some cases, those closest to them.

What is elder financial abuse?

Fraud often involves strangers targeting older Australians through increasingly sophisticated scams, including fake investment opportunities, impersonation scams, cyber fraud and other deceptive schemes designed to obtain money, assets or personal information. Financial abuse, on the other hand, commonly occurs within a relationship of trust, frequently involving family members, carers or others who have access to the older person's finances.

The challenge is that financial abuse is not always obvious. Some conduct may involve outright theft or deception, while other situations arise from undue influence, pressure, exploitation of vulnerability, or a failure to act in the older person's best interests.

Why older Australians are particularly vulnerable

Older Australians are often at an increased risk of financial abuse because they have accumulated significant assets over their lifetimes, including family homes, investments, superannuation and savings. As people age, they may also become increasingly reliant on family members, friends or carers to assist with managing financial affairs, paying bills, attending appointments or making major financial decisions. Health issues, cognitive decline, reduced mobility, social isolation and language or financial literacy barriers can further increase vulnerability.

Importantly, vulnerability does not necessarily mean incapacity. Many older people remain fully capable of making their own decisions but may nevertheless place significant trust in others at a time when they are more dependent on assistance. While these arrangements work well in the vast majority of cases, they can create circumstances in which financial exploitation, undue influence or conflicts of interest arise.

Common examples of financial abuse

Elder financial abuse can take many forms and is often difficult to identify because it frequently occurs within trusted relationships.

In some cases, the conduct involves obvious dishonesty, such as unauthorised use of an older person's money, misuse of bank accounts, withdrawals from investments, forged signatures or the improper use of a power of attorney.

In others, the behaviour is more subtle and may involve pressure being applied to alter a Will, transfer assets, provide guarantees, enter into financial transactions that are not fully understood, or part with property in exchange for promises of future care and support that are ultimately not fulfilled.

Warning signs families should watch for

Financial abuse is often difficult to detect, particularly where the person responsible is a trusted family member or caregiver. Warning signs may include unusual transfers of money, unexplained withdrawals from bank accounts, unpaid bills despite adequate financial resources, or sudden changes to long-standing financial arrangements. Families should also be alert to missing financial or legal documents, unexpected amendments to Wills or powers of attorney, increasing secrecy surrounding financial affairs, or situations where one individual appears to exert an unusual degree of control over an older person's financial decision-making.

While any one of these signs may have an innocent explanation, they can indicate a need for further enquiry. Early intervention is often critical, particularly where significant assets are involved or there are concerns that the older person's wishes may not be properly reflected in the arrangements being made.

Legal remedies for elder financial abuse

Many elder financial abuse cases do not involve a lack of legal capacity. Often the older person understands the transaction and has signed the relevant documents. The real issue is whether the transaction was procured through improper conduct such as pressure, exploitation of vulnerability, conflicts of interest or misuse of a position of trust.

Depending on the circumstances, courts and tribunals may intervene where there has been undue influence, unconscionable conduct, breach of fiduciary duty, misuse of an enduring power of attorney, fraud or theft. In appropriate cases, transactions may be set aside, assets recovered, compensation awarded or other remedies granted to restore the older person (or their deceased estate) to the position they would have occupied had the misconduct not occurred.

Significantly, many elder financial abuse matters arise within families. Adult children, carers, attorneys and other trusted individuals frequently become involved in financial decision-making as an older person becomes more dependent upon assistance. This does not necessarily indicate wrongdoing. However, where a relationship of trust exists, and one party obtains a significant personal benefit, courts and tribunals will often carefully scrutinise whether the arrangement was entered into freely, voluntarily and with fully informed consent.

Elder financial abuse: more than a question of capacity

It is often assumed that elder financial abuse can only occur where an older person lacks legal capacity. However, recent decisions highlight that a person may have full legal capacity and still be vulnerable to financial exploitation.

In La Selva v La Selva [2025] NSWSC 78 (as discussed in our prior article), the Court set aside substantial transfers made by an elderly mother to her son. While the mother retained legal capacity, the Court found that her age, frailty, grief, dependency and social isolation placed her at a special disadvantage that was exploited by her son. The case demonstrates how principles of unconscionable conduct can operate to protect vulnerable older Australians even where capacity is not in issue.

Similarly, in Tony (a pseudonym) [2026] NSWCATGD 13, NCAT’s Guardianship Division considered a challenge to arrangements under which an 85-year-old man transferred his home to his enduring attorney in return for a granny flat interest, a right to reside in the property and ongoing care. The Tribunal confirmed that fiduciary obligations are not confined to occasions when an attorney is formally exercising powers under a power of attorney. Rather, fiduciary duties may extend to transactions entered into personally between the attorney and principal where the attorney obtains a benefit by reason of their fiduciary position. The decision is a timely reminder that attorneys must carefully manage conflicts of interest and ensure that any personal benefit obtained from dealings with the principal occurs only with the principal's fully informed consent.

Importantly, despite these concerns, the Tribunal ultimately upheld the arrangement. Tony had capacity, received independent legal advice in his native language, understood the nature and consequences of the transaction and entered into it freely and voluntarily.  

The decision demonstrates both sides of the equation: transactions between vulnerable older people and trusted family members will be closely scrutinised, but they will not necessarily be invalid where proper safeguards are in place.

The importance of respecting an older person’s autonomy was reinforced in McLennan by his tutor Kennedy v McLennan [2026] NSWCA 102, where the Court of Appeal dismissed a father’s challenge to transactions transferring control of a family trust and his interest in the family home to his son. The transactions formed part of an estate planning strategy to place assets beyond his daughter’s reach. Although the father trusted and relied on his son, the Court found no unconscionable conduct. He had obtained extensive legal and financial advice, understood the transactions and was capable of assessing their merits. The Court recognised that parents may make gifts to children “as a sign of affection or gratitude” ([75]). The decision illustrates that age, reliance on family and a substantial benefit to an adult child do not, without more, establish financial abuse; the particular relationship and circumstances require careful examination ([74]–[85]).

A different safeguard arose in The Estate of the late Wilma Annette Pusterla [2026] NSWSC 951, where a 92-year-old woman had testamentary capacity, but her final Will was refused probate because her knowledge and approval of its contents had not been proved. The solicitor took instructions from her attorney, who became the sole beneficiary, without communicating with her about the Will. Although she had expressed a wish to leave him her home, the Will gave him her entire estate, excluding charities she had supported for many years. Reading the Will aloud to her at a brief signing meeting did not dispel the suspicious circumstances, and the Court found the Will was invalid because the testatrix did not know and approve the contents of the Will ([136], [142]–[148]). The case demonstrates why capacity alone is insufficient, and why solicitors should obtain instructions directly from the client and confirm that the document reflects their actual wishes, particularly where a person involved in its preparation stands to benefit.

The solicitor's role in preventing elder financial abuse

Solicitors play a critical role in protecting older clients from financial abuse and exploitation. While many cases of elder financial abuse involve family members or trusted advisers, solicitors are often one of the few independent professionals involved at a time when significant decisions are being made about a person's assets, estate planning arrangements or financial affairs.

The NSW Law Society's Capacity Guidelines emphasise that solicitors should always begin with the presumption that an adult client has capacity. However, where concerns arise, solicitors have an important responsibility to assess whether the client understands the nature and effect of the transaction, identify potential warning signs and, where appropriate, seek further clinical assessment. A solicitor's role includes making a preliminary assessment, identifying red flags, obtaining specialist medical input where necessary and ultimately making the legal assessment as to whether the client possesses the requisite capacity for the particular decision.

How Bartier Perry can help

Early legal advice can help identify risks, put appropriate safeguards in place and, where abuse is suspected, protect or recover assets. Bartier Perry assists older people and their families with estate and succession planning, powers of attorney and guardianship arrangements, significant gifts and asset transfers, suspected undue influence or misuse of fiduciary relationships, asset recovery, and related NCAT and Supreme Court proceedings.

Authors: Stephanie Flegg & Raffael Maestri

This publication is intended as a source of information only. No reader should act on any matter without first obtaining professional advice.