9.1 Banks and other financial institutions will often be in a prime position to detect and prevent the financial abuse of their older and at-risk customers. As discussed in Chapter 2, financial abuse is one of the most common types of elder abuse. Banks can play a valuable role in protecting their customers and encouraging them to consider carefully the risks of certain practices and transactions.
9.2 In this chapter, the ALRC proposes that banks be required take ‘reasonable steps’ to identify and prevent the financial abuse of vulnerable customers, and that this standard be prescribed in the Code of Banking Practice (the Code), so that the standard is contractually binding. The specific steps should continue to be set out in an industry guideline, so that they can be readily updated.
9.3 The chapter discusses some of the steps banks should take to protect their at-risk customers. These steps include training staff in how to respond appropriately to elder abuse and setting up systems and using software and technology to detect unusual transactions and other potential avenues for abuse.
9.4 Banks should also speak with vulnerable customers directly, or otherwise check arrangements that purport to authorise another person to operate someone’s bank accounts. They should also warn customers, train staff, and take other steps to ensure people are not being financially abused when they guarantee a loan.
9.5 In some cases, banks should report suspected abuse to relevant authorities, with the customer’s consent. These authorities will include state and territory public advocates and public guardians, the police, or the adult safeguarding agencies recommended in Chapter 14.