Financial exploitation is a fast-growing form of abuse of seniors and adults with disabilities.
While not a new phenomenon, instances of financial abuse of seniors have soared as the United States experiences a large-scale demographic shift to an older population. In 2010 there were an estimated 40 million Americans age 65 and older. By 2040 it is estimated that as many as 80 million Americans, or approximately 20 percent of the overall population, will be part of the 65-and-older group.
The number and complexity of reports involving financial abuse of older or disabled adults has grown significantly over the past decade.
- 1 in 9 seniors reported being abused, neglected or exploited in the past twelve months; the rate of financial exploitation is extremely high, with 1 in 20 older adults indicating some form of perceived financial mistreatment occurring in the recent past
- Elder abuse is vastly under-reported; only 1 in 44 cases of financial abuse is ever reported
- Abused seniors are 3 times more likely to die and elder abuse victims are four times more likely to go into a nursing home
- 90% of abusers are family members or trusted others
- Almost 1 in 10 financial abuse victims will turn to Medicaid as a direct result of their own monies being stolen from them
- A recent Metlife study showed that an estimated 3.2 million Americans were victimized by elder financial abuse in 2014.
- Seniors in the United States lose an estimated $2.9 billion each year to financial abuse. The average victim loses $30,000 in scams or abuse, and 1 in every 10 victims loses more than $100,000.
WHAT IS FINANCIAL EXPLOITATION?
Elder financial abuse or exploitation is defined as the unauthorized, illegal, misuse or inappropriate use of an aging or disabled adult’s financial resources by a person in a position of trust. It pervades across all social, racial and economic boundaries.
WHO MIGHT TAKE FINANCIAL ADVANTAGE OF YOU
You might be surprised! According to the National Committee for the Prevention of Elder Abuse (NCPEA), there are all types of individuals, businesses, and others who could take advantage of you. These include:
1) Family members, including sons, daughters, grandchildren, or spouses. They may:
- Have substance abuse, gambling, or other financial problems.
- Believe they will inherit money and other items when you die. They might feel that it is okay to take now what they believe will be theirs eventually.
- Fear that you will get sick and need extra medical or nursing services. They might think that you will use up all of your savings and that they will receive a smaller inheritance when you die.
- Have had a negative relationship with you and believe that you “owe” them something.
- Have negative feelings toward siblings or other family members. They might want to prevent them from acquiring or inheriting your money or other belongings.
2) Caretakers, neighbors, friends and acquaintances, pastor and doctors or nurses
3) Predatory individuals who seek out vulnerable seniors with the intent of exploiting them. They may:
- Profess to love you (“sweetheart scams”).
- Be “new friends” who say they’ll “take care of you.”
- Ask to work for you as personal care attendants, counselors, financial advisors, and so on to gain access to your money and possessions.
- Seek you and other vulnerable seniors out by driving through neighborhoods (to find persons who are alone and isolated) or by contacting recently widowed persons they find through newspaper obituaries.
- Move from community to community to avoid being caught by the police (transient criminals)
3) Unscrupulous professionals or business persons, or persons posing as such. They may:
- Overcharge you for services or products.
- Use deceptive or unfair business practices.
- Use their positions of trust or respect to gain your compliance.
4) Scammers who:
- Contact you and say that you owe back taxes to the IRS and that you must give them your Social Security number, date of birth, and other information.
- Identify themselves as one of your grandchildren. They will alarm you by telling you that they are out of town and sick or without money and desperately need your help. They will tell you not to tell their parents about the situation since they wouldn’t want to worry them. They will cry and say they can only turn to you for help and that they need your credit card information.
- Call you and say that you missed jury duty and must pay a fine or go to jail. You will be asked for your credit card number.
(Source: The National Committee for the Prevention of Elder Abuse (NCPEA))
COMMON WAYS FAMILY MEMBERS AND TRUSTED OTHERS EXPLOIT VULNERABLE ADULTS
- Frequent demands for money. Family members, neighbors, or even romantic partners and spouses take advantage of an older or disabled person’s willingness to lend or provide funds, particularly if the elderly or disabled individual has memory loss. They will often “borrow” money and then “forget” to repay you. Or they will call you up and tell you that their rent is due or they have no grocery money or they can’t pay their utility bills and are sitting in the dark.
- Using a Power of Attorney, given by the victim to allow another person to handle his/her finances, as a license to steal the victim’s monies for the perpetrator’s own use. Some elderly or disabled persons appoint a friend, family member, or lawyer to manage their funds through power of attorney. Unscrupulous people use power of attorney to rob the elder or disabled person of his or her funds and property.
- Some older individuals hold joint savings, checking, or credit card accounts with their children, grandchildren, or other family members. This makes it easy for abusers to withdraw money for their own use without the approval of the joint account holder.
- Using ATM cards and stealing checks to withdraw monies from the victim’s accounts
- Threatening to abandon, hit or otherwise harm the victim unless he or she gives the perpetrator what he/she wants
- Refusing to obtain needed care and medical services for the victim in order to keep the person’s assets available for the abuser
- In-home care providers charging for services; keeping money from errands; paying bills which don’t belong to the vulnerable adult; asking the vulnerable adult to sign falsified time sheets; spending their work time on the phone; and, not doing what they are paid to do
- Reports of financial exploitation of vulnerable adults often involve allegations of abuse and neglect as well.
- Theft of Property. Abusers sometimes steal an elder or disabled person’s property, buying an item from the elder or disabled person at a price far below the item’s market value, or “borrowing” something and never returning it.
- Mismanagement of Assets/Investment Schemes. Abusers might persuade the elderly to funnel money into high-risk investments or business deals. While there is nothing wrong with an elder or disabled making legitimate investments, deals recommended by an abuser are often dangerous to an elderly or disabled person’s financial security.
- Real Estate Fraud. Methods vary, but may include tricking an elderly person into signing over the deed to their home, encouraging an elderly or disabled person to take out an unnecessary mortgage at a high interest rate, or filing a forged deed with the county recorder’s office.
- Bequests and Life Insurance. Financial abusers may persuade an elder or disabled person to make the abuser an heir or name the abuser as a life insurance beneficiary.
- Lodgers and Roommates. Some elderly or disabled people agree to allow a friend or family member to stay with them in exchange for rent or care-taking duties. These arrangements often work well for both parties, but sometimes the lodger doesn’t meet his or her obligations under the arrangement.
COMMON WARNING SIGNS
Here are some common signs of financial elder abuse:
- Money Missing From Accounts. Are large amounts of money missing from the elder or disabled person’s investment or bank accounts? If so, it’s important to find out where the money went.
- Unusual Use of Credit Cards. If an elder or disabled person is suddenly using his or her credit cards more frequently, financial abuse or financial difficulties may be taking place. Also, be on the lookout for changes to the “authorized user” list for credit cards and other accounts. If an abuser has his or her name added as an authorized user to an elder or disabled person’s credit card, he or she typically can’t be held responsible for paying off the balance, ultimately pushing the elder or disabled person into debt.
- Unpaid Bills, Collection Letters, Lack of Food in House. If a financially responsible person appears to not be paying bills or isn’t buying food or other necessities, it’s time to investigate. Mismanaging money or neglecting self-care can be signs of abuse, illness, or dementia.
- Missing Possessions. If you notice that an elder or disabled person’s belongings seem to be missing, ask where the items went. Alternatively, if the elder or disabled person lives with a caretaker and you start seeing a lot of new items around the house, and they aren’t things that the elder or disabled person would normally use, ask where they came from. They may belong to the caretaker, but you want to make sure that the elder or disabled person isn’t paying for them.
- Sudden Changes in an Elder or Disabled Person’s Mood or Demeanor. Unusual and sudden sadness, nervousness, or anxiety are all potential signs of abuse. Other things to look for include changes in spending patterns and socializing habits. Ask yourself if the elder or disabled person is turning down opportunities to go out with family or friends, or if he or she seems hesitant to make normal purchases, such as clothing, food, or holiday gifts. This behavior indicates that the elder or disabled person might be in financial distress.
- Frequent Unexpected Visits. People you don’t consider to be close acquaintances start stopping by to see you more and more often.
If you see these signs and you’re worried that someone’s misusing a loved one’s personal information, please contact Guida Law Offices.