An 89-year-old widow was able to withdraw more than $300,000 in cash with help from bank tellers in an astonishing series of transactions in the 34 months before her death. Herald Graphics / Richard Dale
An 89-year-old widow was able to withdraw more than $300,000 in cash with help from bank tellers in an astonishing series of transactions in the 34 months before her death. Herald Graphics / Richard Dale
The banking watchdog has begun an investigation into one of the country’s biggest banks after tellers helped an elderly widow withdraw more than $300,000 in cash in the 34 months before she died.
The Banking Ombudsman’s probe follows a complaint by the woman’s daughter,who was stunned to learn the family matriarch had made 70-plus teller-assisted cash withdrawals at a Wairarapa Westpac branch totalling $305,000 between September 2017 and July 2020.
It’s alleged that in one instance, staff stuffed $23,000 into an envelope – estimated to be 8cm thick – then handed it to the pensioner, despite her not having a handbag.
Family claim the wealthy widow lived frugally and most of the cash remains unaccounted for.
Banking Ombudsman investigators are now assessing whether Westpac acted with proper care and skill, and if not, whether the bank should pay compensation to the dead woman’s family.
The watchdog has requested a lot of information from Westpac as part of its investigation. This includes diary and file notes relating to the woman’s numerous cash withdrawals, bank statements, correspondence between Westpac, the customer, her family and estate solicitors, copies of relevant telephone calls, the bank’s vulnerable customer policy, and Westpac’s records and investigations into concerns raised by family.
Westpac is defending its actions and has refused to offer compensation. It says the customer was “confident and savvy with money” but private about her finances, and staff “ultimately acted on her instructions in processing the withdrawals”.
This week, the Herald reported that Westpac is also under investigation by the Banking Ombudsman in a second case, which involves the loss of $323,000 by private school principal Mark Geraets in an investment scam in March.
‘What the hell did they think she was spending the money on?’
In the Wairarapa case, the family are asking what checks Westpac made before repeatedly handing over huge wads of money.
Bank statements show the biggest cash withdrawal was $24,000 in May 2019, with more than $60,000 in cash drained from the 89-year-old’s account that month alone.
A further $23,000 was withdrawn during the woman’s final bank visit in July 2020, just three weeks before she died.
Relatives tried to track the funds but believe more than $200,000 has disappeared. They suspect the beloved grandmother – who was later diagnosed with dementia and listed as a “vulnerable customer” by the bank in the months before her death – was the victim of financial elder abuse.
“I was gobsmacked,” the woman’s daughter told the Herald.
“This is just bank withdrawals. So it doesn’t include paying utilities, paying her credit card, anything like that.
“She had no mortgage on her house. She had her car paid off. What the hell did they think she was spending the money on?”
The daughter said she confronted bank staff who allegedly told her they were “too scared” to ask the octogenarian what the money was for, suggesting she “maybe wanted to purchase a mobility scooter”.
“She was 89, she was fragile. She was like 48kg, she was this tiny little woman. I mean come on.”
The family lodged a complaint with Westpac this year. They claimed the Australian-owned company – which earned nearly $1 billion in profit last year – had failed in its duty of care to a vulnerable, elderly client.
Staff at a Westpac branch helped an elderly widow withdraw more than $300,000 in cash in the 34 months before she died. Photo / Google
In response, Westpac said the woman was “well respected” at her local branch. Staff did not believe there were “vulnerabilities” and there was nothing suspicious about the numerous cash withdrawals.
“This is how she wished to operate her bank account/finances,” Westpac told the family.
“You have previously indicated your mother was not someone you would question regarding her funds and as such the branch staff were of the same opinion.”
Westpac told the Herald that staff queried the purpose of the cash withdrawals “on several occasions”.
“However she was very private about her finances ... and our staff ultimately acted on her instructions.”
She told staff the final $23,000 withdrawal was to tide her over during the Covid lockdown. Staff were “comfortable” presenting the cash in an envelope because the woman was accompanied by her daughter.
Westpac is now working with the Banking Ombudsman on the complaint investigation.
Banking Ombudsman reviews privacy policy after handing recordings of complainant to Westpac
The policy review follows a Herald story revealing that Westpac was given recordings of several phone calls between the daughter and BOS staff after the bank requested the material.
The daughter was shocked to learn recordings of her discussing the complaint had been passed to Westpac without her consent.
She believed those conversations were private and confidential. She questioned why Westpac wanted recordings of her discussions with BOS staff and said she would never have consented to the material being shared had she been consulted.
“To me, it’s a breach of privacy. It’s a conversation I had with someone who is supposed to be helping me with Westpac. It feels wrong.”
Banking Ombudsman Nicola Sladden says her office has reviewed its privacy policy after feedback about the release of recordings of phone conversations with a complainant to Westpac.
Westpac told the Banking Ombudsman it wanted the recordings to better understand the complainant’s “expectation of resolution” and “ensure we are on the same page”.
After the woman raised concerns, Westpac said it was yet to listen to the recordings and promised to return them.
“If there has been a misunderstanding in the confidentiality of those conversations, Westpac is happy to return them in good faith.”
Banking Ombudsman Nicola Sladden said her office had reviewed its privacy policy and practices “in light of the feedback in this case” to ensure complainants were made aware of how information was collected, used and shared.
“We will only release recordings of complainants’ phone conversations with BOS staff to the relevant bank if we have the complainants’ express and specific consent to do so.”
Asked how many recordings had been released to banks by her office, Sladden said: “We are not aware of any previous occasion where this has happened. It is very rare for a bank to ask for call recordings.”
Lane Nichols is deputy head of news and a senior journalist for the Herald with more than 20 years of experience in the industry.
