Growing Trends: Elder Financial Abuse

GROWING TRENDS: ELDER FINANCIAL ABUSE

John Reddan, Eldercare Channel

A Closer Look at Elder Financial Fraud and How You Can Empower and Protect

Yourself Against the Abuse

http://www.eldercarechannel.com/

Growing Trends: Elder Financial Abuse The Eldercare Channel 2

Sadly, financial fraud is skyrocketing and

the focus is on the elderly. While there

are state laws that put steep

punishments into place, there is also a

new federal watchdog group that was

founded in 2010, courtesy of the 2009

CARD Act. The Consumer Financial

Protection Bureau is making great strides

in both identifying and empowering both

our nation’s elderly and law enforcement

so that better strides can be made in

eliminating elder financial abuse.

DEFINING FINANCIAL EXPLOITATION

The Older Americans Act defines financial exploitation as:

the fraudulent or otherwise illegal, unauthorized, or improper actions by a

caregiver, fiduciary, or other individual in which the resources of an older

person are used by another for personal profit or gain; or actions that

result in depriving an older person of the benefits, resources, belongings,

or assets to which they are entitled.

According to CFPB:

50 million Americans are aged 62 or older

The elderly population lost nearly $3 billion due to financial

exploitation

there are at least 5 million cases of elder financial abuse in the

United States each year

law enforcement learns of only 1 in 25 cases

3 out of 5 American households have heads of household older than

65 and with no retirement savings at all, which leaves them that

much more vulnerable


We’re living longer, which means holding on to our money is crucial -

women are now living 21 more years than the previous generation and

their male counterparts are living 17 more years.

The elderly are often targeted for a number of reasons. The primary

reason is because so many have lost cognitive skills. But they’re also likely

to be lonely or isolated, as well as vulnerable because of the death of a

spouse, close friend or even a pet. They’re polite and trusting and passive.

These criminals know that they are often reluctant to report these crimes

to law enforcement, partly because they’re fearful of what might happen if

they do – especially if the crime was committed by someone in their family.

FIDUCIARY ABUSE

Unfortunately, the person who’s been appointed as the fiduciary (one who

manages another’s money or other assets) is sometimes the one

committing the crime. Their purpose is to properly manage the money and

property for the elderly person, but too many times, that purpose is

abused.

Further complicating matters is the fact that often, it’s a loved one. We’re

supposed to be able to trust

our family members – sadly,

that isn’t always the case.

There are laws that protect

us from unethical and illegal

behaviors of the fiduciary.

They can be removed at any

time if there are concerns

their objectives are

questionable. They may also

be reported to law

enforcement or the victim’s


local Adult Protective Services. If a fiduciary is found to be stealing assets,

he may face jail time and be ordered to pay restitution.

POWER OF ATTORNEY

A power of attorney allows for another degree of protection. It’s an

inexpensive way of covering the bases and provides invaluable peace of

mind. That said, it’s important for older Americans to put those dynamics in

place while there’s no question about his mental capacities. Avoid those

“do it yourself” options and instead, meet with an experienced elder care

lawyer. Also, remember that

the goal is to provide a sense

of security; however, it’s a

leap of faith. The chosen

person could take advantage

of that massive trust that’s

been placed in him. He

effectively has control over the

financial decisions, which may

or may not include the best

decisions for whom the money belongs.

Elder law attorneys report that criminals will attempt to exploit the elderly

with the power of attorney. Whether or not they’re successful in that effort

determines how much they’re able to steal. If they are unable to secure a

power of attorney, the scammers will steal whatever else they can. They

may promise big returns on small investments of a few thousand dollars or

if they can make their way into the home, they will steal cash or other

valuables (regardless of whether they have power of attorney or not).


OUTSIDE THREATS

But there are plenty of opportunities for those who have never stepped

foot inside their home, too. Those include telemarketing efforts, reverse

mortgage fraud scams (which are growing), lottery or sweepstakes scams

and of course, deceptive investment opportunities, including fraudulent

financial services.

PROTECTING YOURSELF

Elder and estate planning attorneys encourage clients to remain vigilant in

the motives of those around them. It’s important to remain empowered

and they offer these tips:

It’s your money. Don’t be afraid to ask as many questions you feel is

necessary.

Don’t allow yourself to become intimidated. If you think that might be

a concern, ensure there’s someone else present.

Choose your estate planning attorney carefully. Be sure you feel

comfortable with the lawyer and again, ask questions. Any reputable

elder law attorney will happily provide transparent answers to

questions.

Never give out any kind of information – and certainly not your social

security number, address, credit card numbers, banking information

or other bits of data that can help a crook steal what you’ve worked

your entire life for.

Be careful of reverse mortgages. There are many scams making the

rounds these days surrounding these types of financial products. It’s

crucial you understand your rights.


Finally, if something doesn’t feel right, avoid it – at least until you can

complete a bit of due diligence to confirm your suspicions or put

them to rest.

Many often don’t know where to turn once they realize they’ve been

victimized. A call to the estate planning attorney can provide a solid

starting place as it will allow the lawyer to investigate from his end. The

CFPB also encourages loved ones or the victim to visit eldercare.gov.

Eldercare.gov is a public service that’s offered by the U.S. Administration

on Aging. Conversely, they may call 1-800-677-1116. Contacting law

enforcement, notifying the bank and if it’s cash or other monetary assets

that have been stolen, contacting the Federal Trade Commission should be

a priority as well.

The bottom line is the majority of us work hard throughout the course of

our lives so that we can enjoy our later years. We sacrifice vacations, we

budget our money and we fund our retirement accounts. The last thing we

should have to worry about as we age is the fear that a criminal will swoop

in and take it all. It shouldn’t be that way. The more empowered we feel

and the better prepared we are, the less the odds of our becoming victims.


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Growing Trends: Elder Financial Abuse