JOHN Olsen passed away in April. He was aged 95 years and was perhaps Australia’s great living artist. His ‘Salute to Five Bells’ adorns the Opera House. Less significantly, a print from his frogs collection fills one of my office walls! I met him a few years ago, about the time he was facing a very challenging personal situation.

His stepdaughter was charged with defrauding her mother of $2.2M shortly before the mother’s death. A four-year court process found she was guilty. Painful advancing years for a man also grieving a spouse. The court found the gift was procured with undue influence and was kept secret from those that could have been expected to be told. At the time the victim was suffering with a cognitive impairment and there was an absence of any professional financial planning or legal advice around the time of the transfer.

Almost half of the victims of financial fraud are aged 55 years or over. They are not necessarily the wealthy. As in the Olsen case, often both the perpetrator and the victim are in this same age bracket. A sad reality is this activity comes not from some distant stranger, but someone those close to the victim. It may be a relative, or it may be an otherwise caring neighbour.

Powers of Attorney can be abused and funds can be withdrawn and used for other than their proper purpose. Or it may be simple theft. The motivation may be inheritance impatience, and it can involve emotional blackmail and include a failure to provide proper care. Sometimes it involves intimidation and threats. Or it can be a loan guarantor situation gone wrong.

Perhaps it’s a nuance, but a scam is different to a fraud. A scam is more of a trick, while a fraud is a breach of confidence. Scams nowadays are usually online or via call or text, and come from an imposter of one kind or another. Mostly we detect them, but even those with sharp antennae can still fall victim to a major loss. The criminals work a numbers game.

The banks and other corporates are putting hundreds of millions of dollars into strengthening their systems and their ways of doing business, but most often the error resides with the account-holder. The systems, including two-factor authentication, works as designed, and the account-holder has simply been tricked into authorising a transaction they soon deeply regret. The funds move to another Australian bank account, often an account that has been established with false identification, and then the funds are quickly whisked offshore, never to be recovered. As well as a financial knock, it is mentally debilitating to learn that some anonymous criminal has run off with substantial cash.

In my work as a financial planner I need to be vigilant with both the fraudsters and the scammers. In respect of fraud, we use our professional processes and experience to determine whether our client’s best interests are being met. One practical change we have made to combat scams is to no longer email documents as readily openable attachments. Email can be the equivalent of leaving your front door wide open and all your confidential information on your kitchen bench. Good businesses now send this private information via dedicated client platforms backed by robust defences. We also raise awareness via client meetings and webinars. We have worked with institutions like Colonial First State. Here are our favourite tips:

• Don’t share passwords or personal information, especially with someone you don’t know.
• Check your bank account and statements regularly.
• Keep your transfer limits low. Only raise them when you are sure, and do it temporarily.
• If you feel a phone call sounds in any way suspicious, quickly hang up.
• Protect your computer with up-to-date virus software.
• Always use secure websites when shopping online.
• Let your bank know before you travel overseas.
• Don’t send money or personal information to people from unusual locations.
• Avoid swiping your card when making purchases – insert or tap it instead.

The reliable government website is www.scamwatch.gov.au. Stay well, stay safe.

Greg Cook is a Certified Financial Planner and Chief Executive of Eureka Whittaker Macnaught – www.eurekawhittakermacnaught.com.au