Fraud Awareness Week: Ask Banks How They Can Support Banking For Older People And Protect Against Financial Abuse

After $60,000 was stolen from a very elderly man by his “trusted carer”, the Banking Ombudsman says to ask banks what they can do to support the banking needs of older friends and whānau.

Sid*, who was very elderly and had limited mobility, gave his carer his eftpos card and PIN to do jobs and buy groceries. He later discovered the carer had stolen $60,000 from his account over several years. Sid was upset but didn’t want to involve the police. His nephew complained and said the bank should have noticed what was happening.

As Sid had provided his card and PIN to his carer – a breach of his bank’s terms and conditions – his bank wasn’t required to reimburse him for the loss. Sid’s PIN, which should only be known to him, was used to authorise the transactions, and the activity therefore did not trigger any alerts for the bank.

“This very sad case highlights that Sid was in a vulnerable position and needed support with his banking,” says Banking Ombudsman Nicola Sladden. “It’s not unusual for older people to trust friends, family or carers with their bank cards. But this comes with a degree of risk, if the trusted person abuses that trust. The question is what can be done to help older people manage their finances while protecting them from financial abuse.”

Ms Sladden says banks are required to do their best to help meet the needs of all customers, including older customers and customers with disabilities. Banks are also expected to have processes in place to identify customer vulnerability and respond to these customers with extra care.

“Some banks reached out to older people about their banking needs as branches closed and cheques were removed. Checking in on whether bank cards and accounts remain fit for purpose would also be a good idea,” says Ms Sladden. “Ask your bank what they can do to ensure your accounts are meeting your needs. Tell them if you have concerns or if you need support with banking and look out for older friends or family members.”

Ms Sladden says options that are currently available include selecting a trustworthy friend or family member to act as your Power of Attorney to help manage finances. An Enduring Power of Attorney enables that support when people lose capacity. “Talk to your bank now about about how to set this up and what documents are required, to prevent future issues.”

Banks can also help structure accounts to simplify banking, set up separate accounts, automatic payments and direct debits. They can also apply spending limits, block ATM withdrawals, cancel or block credit cards, payWave and online transactions, and set up alerts for when an account balance drops below a certain level or unexpected payments are made. Some banks also offer special phone assistance for older customers and digital banking training and support.

In the UK, some banks are offering ‘carer card’ accounts, which give carers limited access to a person’s accounts to protect against fraud or financial abuse. “We encourage banks to consider what additional steps can be taken to improve outcomes for customers experiencing vulnerabilities.”

Bank customer tips

1. Look out for older friends and whanau and ask your bank what they can do to ensure accounts and cards are fit for purpose and safe.

2. Keep bank cards close, don’t share your PIN.

3. Check account statements regularly.

4. Ask about options for enabling a trusted person to have appropriate access to bank accounts, while keeping savings and investments safe.

5. Report any concerns of theft to your bank and the police immediately.

See our Quick Guides: Financial abuse of the elderly, Powers of Attorney, and Cards and PINs

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