Bank had no grounds to suspect financial abuse of elderly customer

Categories:

Vulnerable customers and hardship decisions, Transaction errors,

Summary:

In January 2023, Penelope visited the bank where her aunt had accounts to say she believed someone living with her aunt might be financially abusing her. In July 2023, she asked the bank to again record that she was concerned about her aunt. In October 2023, she and her aunt went to a branch and had Penelope added as a signatory to the accounts. The following day, a doctor deemed her aunt incapacitated. Penelope got hold of her aunt's bank statements and found she had made payments totalling $23,000 to the person who had been living with her since January of that year.

Published:

October 2024

Penelope complained that in January the bank had asked her to complete a form detailing her concerns about her aunt and assured her during that visit that it would monitor her aunt’s transactions, but it failed to follow through on its promise. As a result, she said, the bank was responsible for all the transactions in question, which she said were made under duress and without the necessary cognitive capacity on her aunt’s part.

The bank looked into her complaint and acknowledged it had put a note on her aunt’s file in July to contact the aunt about payments made on her credit card. However, the bank failed to make contact, and it acknowledged that, had it done so, it might have discovered recent transactions to the person living with her. It offered to reimburse transactions made after the July meeting, a total of $1,750. It later increased this to $3,000 in an effort to resolve the complaint. Penelope did not accept the offer, arguing the bank was liable for all the transactions made since January.

Our investigation

We could find no record of the paperwork Penelope said she completed in January. However, the bank accepted that Penelope had probably visited a branch to express her concerns because staff had accessed and reviewed her aunt's transactions on the day Penelope said she made the visit. The bank’s records showed at that time that Penelope’s aunt had not made any payments to the person living with her in recent months. The bank subsequently gave us recordings of conversations with Penelope’s aunt two years earlier about transactions to the person who subsequently ended up living with her. The calls made clear Penelope’s aunt was making the transactions willingly, and there was nothing to suggest doubts about her mental capacity. And despite the concerns raised by Penelope in January, the bank had no reason, in our view, to look into the payments to the person living with her aunt, or to suspect her mental capacity. Furthermore, the bank’s review of her aunt’s accounts at the time revealed no transactions of concern.