Financial exploitation of older adults is one of the several forms of abuse that is reported the most and while younger adults can also be victims, older adults are more vulnerable for a few reasons. They tend to have more financial assets, their dependence on caregivers may increase with age, they may suffer memory impairment that comes with age, in extreme cases in the form of dementia, or they may be socially isolated. All of which make seniors targets of fraudulent financial acts, often perpetrated by someone they know.
Financial loss resulting from elder financial abuse is estimated at $3 billion each year. According to the Consumer Financial Protection Bureau, the average loss to a senior victim is $34,200. You can help protect yourself or a loved one by being aware of the various forms of financial abuse, understanding the risk factors and by watching for signs that someone is being victimized.
What is financial abuse? Broadly defined it is the illegal or improper use of an elder’s money or belongings without their consent. The abuse can come from adult children or relatives, neighbors, personnel at a nursing home or assisted living facility or a guardian or conservator. It can be exerted in many forms including coercion, forgery, identity theft and scams. The elderly are often targets for scams that include online shopping scams, romance or social media scams, tech support scams, charity scams and sweepstakes scams.
How can you recognize it? Victims don’t always realize they are being abused and if they suspect they are being scammed, they may be too embarrassed to talk about it. It’s important to watch for red flags.
- Finding overdue bills or letters from collection agencies
- Unusual activity in a bank account; large withdrawals, transfer of assets, new name added to the account, forged signatures on checks, unusual number of checks written to cash
- Sudden changes to a will or estate plan or other financial documents
- The unexplained disappearance of valuable possessions from the home
- Bills with charges for services that are not needed or were not performed
These signs are often accompanied by emotional or physical changes that may include being emotionally upset, being withdrawn or uncommunicative, or increased anxiety or depression. Early intervention is critical when you notice any of the above-mentioned suspicious activities.
How can you protect yourself and your loved ones? Knowledge is power; be vigilant and stay informed.
- Start with a conversation with your senior relative or loved one. Remind them to be cautious about providing personal information such as their Social Security number or bank account number. Discuss frauds and scams letting them know that they should never feel pressured to make a financial decision in a hurry or be required to make a payment to receive a prize or gift.
- Make sure you or someone you trust has been designated as the financial Power of Attorney to help manage income, expenses, and assets when your loved one is no longer able to do so. The process is fairly simple and can save you from having to deal with the courts in the future.
- Stay in touch; social isolation is a major contributing factor to elder financial abuse. Abusers will target those who are already isolated or try to wall them off from family and friends. If possible, make unannounced visits, and/or connect via email or video conferencing.
Elder financial exploitation is not going away any time soon. It is expected that in the U.S. the number of adults age 65+ will be about 80 million by the year 2040. Identifying senior financial abuse is required training for both our advisors and staff and the team is always available to discuss any questions or concerns you may have.