The children of aged care clients are increasingly hampering advisers’ ability to determine whether the parent has weakened cognitive abilities, according to a whitepaper published by Zest Financial Services.

“What usually happens is that you’ll have an older client come in, generally with the daughter, who will do all the talking for the person who is really the client,” says co-author of the paper and director of Zest, Chris Castles.

According to one lawyer surveyed for the whitepaper, this leads to a scenario where “the daughter becomes the ventriloquist and the mum becomes the doll”.

The concern is that lawyers and advisers need a clear path to determine if there are any legal capacity issues that would hinder the client’s ability to make decisions, or whether the client has the cognitive perspective to understand the impacts of those decisions.

Castles notes that assessing the cognitive side is “much, much tougher”.

For older clients, the whitepaper states it is important to identify and plan for capacity or cognition issues as early as possible. Without professionals being able to speak to older clients separately, their ability to do so can be compromised.

“The real challenge is to actually separate the two so you can have a decent discussion with the client,” Castles says.

A difference in opinion

In most cases the children aren’t interfering for their own gain, Castles notes, even though it may appear that way sometimes.

“We’re not seeing that people are overwhelmingly trying to take advantage of parents,” he says. “But we are seeing a rise in behaviour that could be perceived to be that.”

Rather, Castles explains, there is usually just a difference in opinion about the best course of action for the parent.

“Quite often, what happens is that there’s a level of frustration between what the kids think is good for mum and dad and what mum and dad want to happen. That’s not necessarily the kids wanting to do the wrong thing by the parents, it’s just a slightly different view on the world.”

Castles gives the example of an ageing parent with declining cognitive abilities who starts forgetting things, which causes the children to be concerned for their welfare and suggest they go into an aged care facility despite the parent’s wished.

“That sort of stuff is quite common,” Castles says. “You have to be really focussed on who the client is and the welfare of that client before you facilitate that, and lawyers have to be involved.”

‘Naturally suspicious’

The possibility that interference from a child is intentional – and indicative of elder abuse – is something that needs to be monitored, according to Castles.

“I don’t want to string it straight to elder abuse, but it’s really a flag where you have to watch the relationship between the father, the son, the mother and the daughter so you can pick up who really wants to do what,” he says.

Castles explains that advisers play an important role in identifying red flags. These flags are often raised, he says, when an adviser talks to the child about how certain decisions need to verified separately with the parents.

“The other thing that happens is that one thing will be said in the meeting with the child there and another thing will be said without the child there,” he explains.

The paper notes that while the family member may have the best intentions, the law is “naturally suspicious” in these matters to protect the elderly.

Tahn Sharpe is a Sydney-based financial services journalist with a background in financial planning. He writes on advice, superannuation, investment, banking and insurance issues, is a certified SMSF Adviser and holds an Advanced Diploma of Financial Planning.
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