Ethical and professional considerations

Unwillingness to accept that they are a victim of financial abuse is a common reaction for older people, particularly where family members are concerned. Denial is a common first reaction to the receipt of bad news for many people, old or young. When loved family members are involved, disbelief that they are victims of abuse can often be followed by anger at the person who suggested it.

Older people often fail to act on abuse. There is a tendency to excuse the failings of their children, and a reluctance to get them into trouble. There is a fear of the loss of love, of isolation and abandonment, or of loss of contact with grandchildren.

An older client has the right to ratify originally improper transactions if they so desire. As their accountant it is your role to make the older client aware of the events and inform them of their options, to provide advice in relation to the matter, to ensure that the advice is understood, and then to act on the client's instructions.

The APES 110 Code of Ethics for Professional Accountants standard provides guidance on the appropriate response for professional accountants who come across suspected unlawful activity on the part of their client or employer.

Where illegal activity is suspected, you are advised to:

• explain to the client or employer the potential illegality of the arrangement and get them to stop that activity
• suggest alternative, legal ways in which the client's needs might be met
• disclose the activity if there is a legal obligation to do so
• if the client or employer does not change the suspect behaviour, then resign from the engagement or employment
• if disclosure is not mandatory, consider whether, in your professional assessment, disclosure is warranted in the public interest. If your professional assessment is that disclosure is in the public interest, you are strongly advised to seek legal advice before proceeding.

Cases of financial abuse of older people most usually involve "improper" conduct and not criminal conduct. During the interview with the older client, however, you may suspect that unlawful acts have been committed, such as theft, or physical abuse. Whether an act is unlawful is often difficult to determine and it is not the role of the accountant to so determine. It is important however that the suspicions be followed up.

Interventions on behalf of the older client must be respectful of that person's rights. They must also be sensitive to the client's situation and be conducted in such a way that they do not make matters worse. The older person may not wish to involve the police, especially where trusted family members and friends are concerned.

If the victim does not want to report abuse, even physical abuse, then it is not the prerogative of their accountant to report it for them, unless you believe that the older person is in imminent personal danger, or if you believe that the matter must be reported in the public interest.

You must let your client know that an unlawful act may have been committed and advise them of their rights. You should advise your client on potential responses to the situation, ensure that your client understands their rights and the advice, and then seek instructions, confirmed in writing.

• Explain to your client that the suspected unlawful act is no less unlawful because it has been committed by a family member or friend, and recommend to your client that the matter be reported to police. You may offer to call the local State or Territory elder abuse service with the older person, to get their input.
• You may yourself refer to external agencies for general advice on how to advise a client in this situation, while respecting confidentiality.
• If you suspect something illegal or dangerous, you should express that to the client, minute it in the record of meeting and confirm it to the client in writing.
• If the client is the perpetrator, you should explain why you cannot assist the client any further unless the potentially unlawful acts are rectified and discontinued (see below for some suggested phrases).
• All practitioners will have a Letter of Engagement and it is recommended that it limits confidentiality in matters where there is a clear breach of the law. However, before relying on any such clause, first seek legal advice.
• If you consider that an unlawful act has been committed and you are considering reporting the matter to an authority or body, thereby potentially overriding confidentiality, it is strongly recommended that you first seek legal advice on the matter.

• "It appears that this act may be unlawful."
• "The consequence of this act, if unlawful, are …"
• "If I am involved, the consequences for me may be highly significant."
• "It may be highly detrimental for me if I were found to be involved in any way."
• "Here are some options for going about this which are not unlawful ..."

The conversation with the client, whether abused or perpetrator, should be confirmed in writing.

If you are in doubt as to how to proceed, it is recommended that you contact your State or Territory elder abuse service for general advice. Alternatively, you could contact Ethi-call for impartial guidance on ethical issues.

• Duress
• Fraud
• Obtaining financial advantage by deception
• Forgery
• Assault or the threat of assault

It should be noted that in some jurisdictions, for example in Victoria, economic abuse of a family member is included in the statutory definition of family violence: see the FAMILY VIOLENCE PROTECTION ACT 2008 - SECT 5 Meaning of family violence for more detail.

CPAs are required under APES 110 to be objective and not allow bias, conflicts of interest, or undue influence of others to override professional or business judgements. They must also exercise professional competence and due care.

CPA Australia requires that its members, as trusted professionals and as members of a highly respected professional association, respond professionally and with integrity. Where financial abuse is suspected, you can use this toolkit to assist you to respond in a way that meets your professional and ethical obligations – that is, to advise the older person that they may be experiencing abuse, to provide advice on how to avoid or remediate abuse, and to be cautious in ensuring that you do nothing to contribute to the abuse.

A great deal of information is provided to accountants that is personal and confidential to the client. Confidentiality must be respected. It is recommended, however, that your terms and conditions of engagement specifically exclude from promises to maintain confidentiality any events where contravention of the law is evident.

Where information has been provided that indicates potential financial abuse, but does not involve clear breaches of the law, you must bring the potential abuse to the attention of the client and seek their instructions. If the client is the older person, and lack of capacity is suspected, advice should be sought from one of the State or Territory elder abuse services.

Client confidentiality must always be respected, except where clear breaches of the law are involved. However, advice concerning potential abuse should be provided to the client in writing. You should not do anything to facilitate the arrangements unless requested to do so in writing by the older person concerned, and only then when that older person demonstrates capacity and has been fully advised of the potentially negative outcomes.

To maintain confidentiality, and to ensure that you get the whole picture, interviews with the older person should be conducted without the presence of other interested parties. Where you believe that an unlawful act may have been committed, and you are considering reporting the matter to the police, it is recommended that you seek legal advice before doing so.

A CPA must not act for both clients where there is an actual or potential conflict of interest – for example, between an older person and their adult child.

Where the client is the adult child (or the potential abuser):

• you should recommend that the older person get advice from another qualified party. hat other party may be a different partner within the same firm, or from a different firm altogether
• you may assist the older person by recommending alternative qualified professionals.

Where the client is the older person:

• you should refer the adult child (or the potential abuser) to another qualified professional
• you need to be absolutely independent of the party with the influence or control over the older person
• your advice and the subsequent instructions given to you by the client should be confirmed in writing, and sent to the older person, not to their children or other family members, not even if those family members have an enduring power of attorney.

Your client may not welcome you bringing the potential for financial abuse to their attention. In many cases, it is the client's children who are the potential abusers and the client, if the older person, may not accept that there is cause for concern. After all, you are advising them to be wary of the potential (or suspected) actions of their own children.

If it is the potential abuser who is your client, providing advice brings additional challenges.

You may feel that your advice will be unwelcome, will probably be ignored and may result in the client going elsewhere for more palatable advice. The temptation to ignore the situation can be substantial. You have a clear duty of care to your client, and an ethical and professional duty to address concerns of potential abuse.

These pages offer some suggestions for ways to provide advice in difficult situations involving potential financial abuse which, when used with skill, may strengthen your relationship with your client. At a minimum however, potential loss of business is not a valid reason for ignoring possible abuse.

Financial abuse of an older person can be a confronting and difficult challenge for the professional. These guidelines will be useful if you must approach such a situation.

• Give comprehensive and independent advice so that the client can make their own informed decision.
• Ensure your client has the capacity to make the decision and is not acting under undue influence.
• Ensure your client receives and understands your advice.
• Be aware of the impact of cultural diversity and any language barrier.
• Intervene, but be careful that your intervention is respectful and does not make matters worse.
• Be true to your professional integrity and your moral responsibility.
• Seek assistance and advice from your colleagues and from State or Territory elder abuse services whenever you feel ill-equipped to proceed.

When recommending a course of action, clarity of engagement and of the costs associated with proposed action are important in reducing future dispute or loss of the client. This is best achieved through an engagement letter.

Adults of any age have the right and, unless proven to the contrary, are presumed to have the capacity to make their own decisions – even bad ones that ignore, or open up potential for, financial abuse. It is not the adviser's role to prevent the abuse. It is the adviser's role to ensure that the client is fully aware of the issues and of their rights and remedies, and that they knowingly and willingly accept the risks of the abuse, or with the adviser's help, take steps to mitigate them.

A CPA who fulfils that role when faced with a situation of actual or potential financial abuse will be making a significant contribution to the improvement of outcomes for older people.