Whenever we talk about scams and fraud, the first things that come to mind are the number of cold calls, text messages, emails or even fake websites that we are bombarded with, in a bid to steal our savings.
But according to a recent report by the Insurance and Financial Services All-Party Parliamentary Group (AAPG) and the Financial Vulnerability Taskforce, there is enough anecdotal evidence to suggest that a “significant amount of financial abuse” happens in a victim’s home.
While there is a lack of research in the field, in 2008 a report for Help the Aged found that 70% of financial abuse of older people was perpetrated by family members.
Although the data is more than a decade old, “we do know that around 50% of financial abuse in the UK is perpetrated by adult children of the victim”, said Craig Tracey, chair of the Insurance and Financial Services APPG.
“Furthermore, we know that whilst theft and fraud within families is not restricted to older people, demographic changes including living longer will undoubtedly increase its prevalence, with property and complex financial resources a challenge for many to manage over time.”
Tracey said that the Taskforce’s report highlights the ‘elephant in the room’ and spreads awareness on an issue that the industry should be aware of and help their clients with.
We ‘must investigate further’
Keith Brown, member of the Financial Vulnerability Taskforce and chair of the Safeguarding Adult National Network, added: “Our understanding of financial fraud and scams has significantly developed over recent years. Indeed, most of us receive texts, emails and phone calls on a weekly, and sometimes almost daily basis, from criminals attempting to defraud us out of our savings.
“However, the more I seem to speak and write about this issue the greater seems to be the feedback that I receive from individuals describing theft and fraud within families.
“People contact me in a very distressed state to talk about how a close relative has taken money without permission or knowledge from another family member. This is not just one or two examples, but increasingly is becoming the majority of stories I come across.
“What is clear is that very few crimes from within families are ever reported to the authorities.”
Lack of understanding
But Brown said that there is still a lack of understanding around the motivation for such behaviour from family members.
Is it to try and avoid paying inheritance tax? Or do relatives believe the money belongs to them and decide to access it early rather than wait to inherit it?
“We simply do not know,” he said.
What we do know is that “it is a problem”, but there is no consensus on how big it is.
Brown continued: “It is clearly a very sensitive subject, and it is likely that ‘toes will be trodden on’ as we look into it further, but it really needs to be done. It is not just organised crime and individual criminals who undertake and commit fraud and scams, it is also hidden within families, and we simply must look into and investigate this further.”