Key points
- Elder financial abuse is an emerging crisis in Australia's aged care system.
- Family members, scammers and poorly regulated advice can put older Australians at financial risk.
- As Australia's population ages, experts warn stronger aged care fraud protections are urgently needed.
By Dr Clare JM Burns
With a modest home, healthy savings and a careful retirement plan, Margaret was looking forward to spending as much time as possible with her beloved grandchildren.
But when her son began raising questions about the cost of aged care and whether she had ‘thought carefully’ about her will, the lights of her life suddenly became a bargaining chip.
His message was clear: if she wanted to keep seeing her grandchildren he expected to be ‘looked after’ in her will.
Sadly, financial advisers say Margaret’s story is not rare – they see it often.
It’s just one example of a growing crisis in Australia – one that is largely hidden in plain sight.
Older Australians are being exposed to financial exploitation at increasing rates, and alarmingly, the very system designed to support them may be compounding the risk.
In a recent webinar I hosted for Bond University and the Australasian Business Ethics Network, we brought together leading researchers, practitioners, and advocates to unpack the realities of fraud in aged care.
What emerged was not a series of isolated incidents, but a pattern – a fragmented, complex system that creates the perfect conditions for exploitation.
From online impersonators to providers who aggressively oversell services such as cleaning, personal care and food coordination, the risks are both individual and systemic.
One of the most confronting insights from our discussions was that financial exploitation often occurs closer to home than many would like to admit.
While public narratives tend to focus on external scammers, evidence suggests family members are frequently involved, sometimes knowingly, but often not.
Individuals with power of attorney may unintentionally misuse funds because they misunderstand their responsibilities or are acting under pressure.
Older people and their families are navigating a system so complex it can expose them to exploitation at exactly the moment they’re least equipped to deal with it.
The scale of the challenge cannot be ignored. By 2057, Australia’s population aged over 65 will reach 8.8 million.
With longevity comes increased reliance on aged care services, and with that, greater exposure to financial decision-making at times of stress, grief, and cognitive strain.
Many families enter the system when already in crisis following a fall, illness, cognitive decline or the loss of a partner.
These are not conditions that support careful, informed decision-making.
We consistently see people entering aged care forced to make rushed financial decisions under stress.
That’s when the risk of poor advice and outright fraud is at its highest.
Compounding this is a blurred boundary between information and advice.
Many people are authorised to provide information on aged care services, but too often this extends into unqualified financial advice.
This is a critical fault line.
Those influencing financial decisions should be bound by a clear fiduciary duty to act in the older person’s best interests, but unfortunately this standard is applied inconsistently.
For older individuals experiencing cognitive decline, or simply cognitive overload, distinguishing between legitimate assistance and self-interested advice is extraordinarily difficult.
Younger family members become lost in this complex quagmire too.
While some service providers make mistakes without malice, others deliberately exploit the ambiguity.
Either way, the outcome is the same – harm at a time when recovery is least likely.
Family dynamics further complicate matters.
While uncomfortable to acknowledge, research shows that sons are the most common perpetrators of financial abuse, followed by daughters.
These situations rarely present as clear-cut fraud, but tend to unfold gradually, often under the guise of ‘helping out’ or managing finances on behalf of a loved one.
The absence of a trusted advocate – after the loss of a partner – can leave older people exposed to anyone presenting themselves as a ‘helper’, regardless of whether they are acting in their best interests.
So what must change?
First, we must confront the system-level issues. Aged care financing and service navigation are too complex.
The average ‘person on the street’ cannot consistently source decision-useful information.
Simplification, transparency and stronger regulatory oversight are essential.
Second, safeguards around financial advice must be strengthened.
Clearer boundaries between service information and financial decision-making are long overdue.
Anyone influencing an older person’s financial position should meet consistent professional and ethical standards.
Encouragingly, some university accounting programs are beginning to embed the identification of aged care fraud into their curricula.
Third, we need to normalise the role of appropriate support, whether a suitably qualified financial adviser, a trusted family member, or an independent advocate with the skills to act effectively.
Older Australians need someone firmly in their corner, particularly during periods of transition and vulnerability.
Finally, we must talk about this issue more openly – families need to have these conversations before crisis hits.
Financial exploitation in later life is neither rare nor inevitable. It is the product of systems, behaviours and silences, all of which we have the power to change.
Australia’s ageing population deserves dignity and respect.
That must include protection. And it begins with recognising that the risk is real, the system is imperfect, and the time for meaningful change is now.
- Assistant Professor Clare JM Burns from Bond University is Co-Convener of the Australasian Business Ethics Network Special Interest Group on Finance and Accounting. The webinar was conducted with panellists from the University of Western Sydney and Aged Care Steps.