We can all do our bit to prevent financial abuse

Those who work in professional services are often best placed to spot early warning signs, allowing action to be taken

by Rachel Waller

The Financial Conduct Authority recently revealed survey data showing that just four in ten vulnerable customers had made financial services providers aware of their specific needs. It also found a lack of training to address such needs, and ineffective monitoring once identified.

Yet ironically, those employed in professional services are often best placed to spot signs of financial abuse — and without their vigilance, the perpetrators can escape scrutiny.

And financial abuse is increasing. Hourglass, a specialist charity that targets abuse and exploitation of older people, cites a nearly 50 per cent rise in calls from victims. Likewise, the Society of Trust and Estate Practitioners (Step) reports that 70 per cent of its UK members, including solicitors and those helping clients with estate and wealth planning, have observed instances of actual or suspected financial abuse. About 40 per cent of those surveyed by the society said that instances of financial abuse have increased in the past two years.

In my practice I see daily the devastating impact of financial abuse, commonly including misuse of powers of attorney and coerced debt. Once the signs have been spotted, there are several steps that can be taken to protect victims and recover funds.

However, victims are often older people and there are cases where the financial abuse does not come to light until after they have died. Although legal action can then be taken to recover assets on behalf of the estate, that offers no benefit to those who suffered the abuse.

It is incumbent on all of us to do what we can for those around us who are less able to protect themselves from abuse. Step’s “spot the signs” campaign aims to help identify financial abuse. Signs can include lack of financial records from a care home, a new person showing unusual interest in a person’s spending habits, isolation from friends and family, a decline in living standards, assets being suddenly transferred without a clear reason, or even a sudden betterment of lifestyle of someone close to the vulnerable person. If spotted, action can then be taken.

The financial watchdog’s report also highlights measures that professionals who work in the financial sector and professional services can take. Essentially, it is vital that they are trained to spot the signs of financial abuse, so that action can be taken to safeguard victims as soon as possible.

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We can all do our bit to prevent financial abuse