In a conversation with ifa, Wealth Planning Partners director Amanda Cassar argued that licensees need to have a plan for their advisers to follow if and when they come across cases of financial abuse in their clients.
“I think licensees need to have vulnerable client practices and financial abuse standards within the business, and I don’t think a lot of licensees do have that at the moment, and a standard procedure about who to call,” Cassar told ifa.
She explained that the procedure should outline the steps advisers need to take, and who they need to contact, when they come across such cases.
“Having a procedure where we go, ‘Right, I’m calling my compliance team. Next, I’m calling the fund manager to say, look, we believe this is a case of financial abuse. Can you please delay the transaction until we’ve got more information?’” Cassar said.
“You know, bringing the fund manager in on the whole conversation. Look, we do want a copy of the power of attorney. You know, is there another person on the power of attorney that we can call and ask if this is what they want?
“If the client hasn’t lost capacity, are we calling the client directly and saying, ‘Look Bill, Ted’s just asked us to, you know, shut down the fund. Is this something you’re aware of? Is it what you wanted? These were your goals, I don’t believe it’s still in line with your goals that we’ve discussed’.”
Cassar stressed the importance of businesses having a “toolkit” of local contacts available that advisers can reach out to or refer clients to for further assistance.
“Obviously there’s hotlines, but who can they call locally? Are there advisers who are more experienced with it? Do they have domestic violence lawyers they can call who work in this space?” she said.
In addition to this, she argued that licensees should be vocal about the subject by discussing strategies at conferences.
Reflecting on a past experience with a client, Cassar stressed the importance of advisers being prepared to take fast action in order to protect their clients.
“There was one case where I was very close to calling the police because there was physical assault as well. Many police departments now have an elder financial abuse unit where they have specially trained police involved where there’s outright fraud,” she said.
“It may be that you do need to get them involved and quickly, because it can take three to six months to go to your local Civil Administrative Tribunal to have a power of attorney removed, and so much damage can be done in a day, let alone weeks and months.”
In cases where the abused party has lost capacity, such as in an elder abuse scenario, Cassar explained that it can be even more difficult for an adviser to help correct the situation, making it even more vital that advisers have a plan for handling such an event.
