Guarding against financial abusers: new guardianship and administrator laws passed

Administrators appointed by the Victorian Civil and Administrative Tribunal who financially abuse elderly and disabled people for their own financial gain will now face prison time and fines under new laws passed by Victorian Parliament.

The changes to the Guardianship and Administration Act 2019 (Vic) (‘the Act’), means those who misuse their power could face fines up to approximately $95,000 or five years prison.

The changes bring guardianship laws more in line with the attitudes and changes brought about by the Powers of Attorney Act 2014 (Vic) and Medical Treatment Planning and Decisions Act 2016 (Vic).

The shift in this suite of legislation over the last few years signals a recognition by Parliament that tougher laws are needed to stamp out abuse of elderly people and others who are unable to manage their own affairs and therefore reliant on an enduring attorney or a VCAT appointed decision maker.

The Act reflects a more modern understanding of an individual’s decision making capacity and introduces a new presumption that a person has decision-making capacity unless evidence is provided otherwise.

Other changes include:

Supported decision making

The changes now recognise that an individual still has decision making capacity even if they require additional support to reach the decision. Accordingly, VCAT can now appoint a supportive guardian or administrator who can help a person make their own decisions. This reflects VCAT’s mandate to only deprive someone of their ability to make decisions for themselves if there is no other less restrictive option available.

Penalties for guardians and administrators

The tougher penalties for VCAT appointed administrators for abusing their position for financial gain brings the penalties into line with penalties introduced in the Powers of Attorney Act 2014 (Vic) that apply to people who abuse their position under a Power of Attorney.

The Act further allows individuals to seek compensation for losses caused by guardians or administrators who breach their duty.

These harsher penalties aim to address the communities rising concern of elder abuse, explored in our earlier hot topic.

Announcing the changes in March 2018, Minister for Housing, Disability and Ageing Martin Foley said: “These laws are about striking the right balance in promoting the rights of people with impaired decision-making ability, while ensuring appropriate safeguards for people at risk of harm.”

VCAT powers and procedure

Other procedural changes include the requirement for the affected person to be present at VCAT for all initial application hearings, unless VCAT is satisfied the person doesn’t want to attend or there is a justifiable reason for their absence.

What does this mean?

For people who have concerns that a family member is the subject of financial abuse or other forms of elder abuse, the laws will mean they have new options available to them to hold administrators to account.

The new Act is also a reminder to individuals currently appointed under guardianship and administration orders to ensure they are diligent with their record keeping and to be aware of the new penalties.

Macpherson Kelley frequently appears for clients in VCAT’s Guardianship List and has a track record of success in obtaining orders to stop financial abuse and recover misappropriated assets.

If you would like to find out more about these changes, please contact Joanne Hazeldene or James Dimond, or others from our Private Clients team for more information.

This article was written by Alanna Richmond, Lawyer – Private Clients.