Elder financial abuse has been called the “Crime of the 21st Century.” A 2011 MetLife Study of Elder Financial Abuse estimates that elder financial abuse costs American seniors $2.6 billion a year. Yet, according to the National Center on Elder Abuse, only 1 in 25 cases of financial elder abuse is ever reported.
Financial abuse is defined as illegally or improperly using an older person’s money in ways that are not in the person’s best interest. This can take many forms:
- Forging an elderly persons’ signature
- Gaining an elder’s trust then exploiting the relationship for gifts or loans
- Coercing someone to change legal documents
- Stealing possessions
- Telemarketing scams.
These financial losses are particularly difficult for elders. They are often unable to recover from losses. They are no longer earning a salary and cannot wait for investments to grow. The abuse can also have an emotional impact as the victim may be ashamed, lose confidence, or become fearful or depressed.
While some fraud is committed by strangers, often the perpetrator is someone the elder knows and trusts. This may be a family member who is financially dependent on their parent, has a history of substance abuse, or has been frequently “bailed out” by Mom and Dad. A caregiver, neighbor or friend may gain the trust of an elder, then take advantage of the elder’s emotional and physical dependence.
Abuse is most often detected by another family member or concerned neighbor or friend. Signs to watch for include:
- Changes in banking habits; increased use of ATM or credit cards
- Change in mood; acting fearful or reluctant to speak around certain people
- Sudden changes in a will or transfer of assets
- Additional names on house deed; new loan on property
- Unpaid bills
- Disappearance of valuables
- Increased isolation
- New “best friends”
Many seniors eventually require assistance to pay bills and complete other financial tasks. This puts them at greater risk for fraud. No older person wants to give up independence, so how can you step in and help?
- Talk regularly with your elderly relative. If you sense they need assistance with their finances or other daily tasks, see how they will accept help.
- Have someone other than caregivers regularly review bank and investment statements and the checkbook register, or monitor transactions on line.
- Hire a professional Daily Money Manager to assist with bill paying and tracking financial information.
- When looking for caregivers, work through an established agency and request a background check.
Don’t forget to look ahead to your own future. Start planning now to protect your own assets as you age. Planning and awareness are keys to protecting your loved ones and yourself.
Resources
National Committee for the Prevention of Elder Abuse: www.preventelderabuse.org
MetLife: www.MatureMarketInstitute.com. Look under “Consumer Advice” for tips for caregivers and seniors.
National Center on Elder Abuse: http://www.ncea.aoa.gov for information and an eldercare locator.
American Association of Daily Money Managers at http://www.aadmm.com for information and a Daily Money Manager locator.
