Sharon Young, 55, was charged by Queensland fraud detectives this week for allegedly using the funds to pay off her own personal debts and to buy properties in both Western Australia and Queensland.
She is also accused of confining her 80-year-old mother to a nursing home with no means of financial support.
Young appeared in the Pine Rivers Magistrates Court on Friday on one count of fraud relating to a trust fund.
She was granted bail to reappear on October 30.
Police said her actions only came to light when Centrelink referred the matter to the Adult Guardian and Public Trustee which triggered a Fraud and Cyber Crime Group investigation.
Her actions constituted elder abuse, said Acting Detective Superintendent Terry Lawrence.
'Sadly elder abuse does exist and the most common forms in Queensland are financial and psychological abuse,' he said.
'Those people who have worked hard all of their lives should be entitled to enjoy their later years without harm and neglect and in the comfort they are respected, loved and cared for.'