Every year, June 15 marks World Elder Abuse Awareness Day (WEAAD) and the team at Hodgkins Law likes to take this time to pause and reflect on this persistent and growing problem. The financial exploitation of older or vulnerable adults can take many different forms; our elder population can be exploited by strangers, professionals who deal with their assets, and even trusted family members and loved ones. The shame of being taken advantage of often leaves these crimes unreported and unfortunately these types of abuse can not only affect the finances of the victim, but also their mental and physical well-being. Elder abuse can take on many forms – let us take a look at some of the more pervasive financial abuses that occur and note some of the measures that can be taken to prevent these types of crimes.
Types of Financial Elder Abuse
The grandparent scam is one tactic strangers use for financial exploitation of seniors. In this scam, the senior is called and told his or her grandchild is in jail and needs money immediately. Many seniors fall prey to this scam because they want to help their grandchild.
Charity scams occur when the scammer calls and asks for money for what seems to be a very good cause in order to get money from the senior. Natural disasters are often used in this type of scam.
Home repair con artists are another way vulnerable adults succumb to financial abuse. They promise to provide a service and ask for payment up front. Then they never return to provide the service.
These predators often use lending schemes to pressure elders into taking inappropriate loans or reverse mortgages that the person does not need. Email scams concerning false bank accounts are used to siphon money from vulnerable adults. Investment schemes tout unrealistic returns on particular investments in order to entice individuals into buying in. Using Identity Theft to open credit card accounts is yet another way professionals take advantage of unwitting seniors. Lastly, Medicare scams are some of the costliest scams by professionals.
3. Family Members and Loved Ones
Finally, financial elder abuse is commonly committed by family members and loved ones. These scams can take many forms; it can start with pocketing the change left when running errands. In some cases, the Power of Attorney agent will use the power given by the individual to control the finances as an opportunity to embezzle the elder’s money and use it for his or her own purposes. Family or loved ones also commit financial elder abuse when they use ATM cards or steal checks to gain access to money from the vulnerable adult.
Protecting Our Elders
Let your older loved ones know there is no shame in reporting possible financial abuses. These criminals and scammers are smart and know how to play the game to take advantage of people. Work with your loved ones to stay on top of accounts and be proactive about working with law enforcement and the various institutions to report anything that looks suspicious. It is important for family members and friends to have checks and balances when taking control of someone else’s money and assets. Accountability is key.
Recently the Senior Safe Act was signed into law, which is a step by the federal government to help protect elders from financial abuse. Under the Act, banks, credit unions, investment advisers, broker-dealers, insurance companies, and insurance agencies are protected from being sued for reporting suspected fraud, but their employees must be trained to understand the warning signs. It empowers financial service representatives to identify warning signs and help keep vulnerable adults from becoming victims of financial abuse. There is no easy answer, but hopefully, increased awareness will help financial elder abuse to decline.
For more information or to learn more about how to take action, please visit https://eldermistreatment.usc.edu/weaad-home/take-action/.
If you would like to learn more about how estate planning can be used to protect you and your loved ones from financial elder abuse, please click here to sign up for a free seminar.