Older adults can be abused in a variety of ways. Financial exploitation is common among the elderly, as many older people have amassed large amounts of money, and people often feel entitled to it.
Financial exploitation is defined as the unauthorized or improper use of an older person's funds or assets. Surprisingly, many cases of financial abuse are perpetrated by a person’s family members. Caregivers who are responsible for an elderly person’s daily needs can sometimes misuse their position of trust. Professionals such as accountants and financial advisors may also exploit their position to defraud their elderly clients.
But of course, financial abuse is often perpetrated by strangers as well. Scammers will use a variety of schemes to target the elderly. Phone scams, email phishing, and fraudulent investment opportunities are some common ruses.
Elderly people tend to be trusting and vulnerable, which is why they are often the victims of scams. Plus, many seniors are lonely and welcome attention from others, even if these people are not looking out for the elderly person’s best interests.
Financial abuse can cause a lot of damage. It can cause loss of money, of course, as well as unauthorized credit card debt, reduced credit scores, poverty, stress, anxiety, and even bankruptcy.
If you are concerned about your elderly loved one, it’s a good idea to learn about how financial abuse occurs, the warning signs, and how to prevent it. Here’s what you need to know.
Types of Financial Abuse
Financial abuse can happen in the following ways:
Theft. This involves the direct stealing of money, property, or belongings.
Fraud. This involves deception to gain access to funds, such as through scams or identity theft.
Neglect. This means charging for care that is not provided or diverting funds intended for the elderly person’s care.
Improper use of power of attorney. This involves misusing legal authority to take control of an elderly person's finances for personal gain.
Undue influence. This means manipulating the elderly person to change their will, make unnecessary purchases, or sign over assets.
Risk Factors
While anyone can be a victim of financial exploitation, some people face a higher risk than others. They include the following factors:
Cognitive impairment. Elderly people with dementia or Alzheimer’s disease are at higher risk.
Wealth. Elderly people with significant assets are often targeted more aggressively.
Isolation. Those who are socially isolated may be more vulnerable to exploitation.
Dependence on others. High dependence on caregivers can lead to an imbalance of power.
Warning Signs of Financial Exploitation
Do you have a feeling your elderly loved one is being financially abused? Here are some signs to look for:
Unexplained withdrawals. These include large or frequent withdrawals from bank accounts.
Sudden changes to financial documents. You might see changes to a will, trust, power of attorney, or other financial documents that seem unusual.
Missing belongings. Your loved one might suddenly have personal items or property go missing.
Fraud attempts. You might notice suspicious signatures on checks or outright forgery. You may even see checks written as “loans” or “gifts.”
Changes to accounts. Your loved one might be closing CDs or other bank accounts without regard to penalties.
Shame. Your loved one may know that something unusual is going on but may be ashamed or afraid to discuss their financial issues with you.
What Can Be Done?
If you're a victim of financial exploitation, act quickly and take the following steps:
Secure your accounts. Go through your recent account statements to identify unauthorized transactions. Immediately notify your bank to freeze your accounts or place a hold on any suspicious transactions. Update passwords for all your online financial accounts.
Notify credit bureaus. Contact the major credit bureaus (Equifax, Experian, and TransUnion) to place a fraud alert or freeze on your credit.
Report the exploitation. Report the crime to your local police department. Provide them with all relevant information, including any evidence of the exploitation.
Notify Adult Protective Services (APS). Contact your local APS office. They can investigate the situation and offer resources and support.
File a complaint with the Federal Trade Commission (FTC). The FTC can provide resources and help with the next steps. You can file a complaint online.
Consult with an attorney. An attorney specializing in elder law can provide advice on how to recover lost assets and take legal action against the perpetrator.
How Seniors Can Protect Themselves
Fortunately, there are many ways in which seniors can protect themselves from financial abuse. Here are some good tips for seniors and their loved ones:
Focus on awareness. Teach seniors about common scams and fraud tactics, including phishing, telemarketing scams, and fake charities. Encourage understanding of basic financial principles, which can help them spot suspicious activities.
Keep in contact. Maintain regular contact with the elderly, discussing their financial situation to spot any irregularities. Urge them to share financial information with a trusted family member.
Have legal protections in place. Set up a durable power of attorney with someone trustworthy, ensuring that decisions can be made on their behalf if they become incapacitated. Ensure their will and any trusts are up-to-date and reflect their current wishes.
Set up account alerts. Set up notifications for large withdrawals or any unusual activity. Regularly review bank and credit card statements for unauthorized transactions.
Secure important documents. Ensure that financial documents, like deeds, wills, and account information, are kept secure. Shred any financial documents that are no longer needed to prevent identity theft.
Use community resources. Be aware of local elder abuse hotlines and resources for reporting suspected abuse. Encourage participation in senior centers or community groups, which can reduce isolation.
Contact Newman Law Group Today
Older people are vulnerable to all sorts of abuse, and financial abuse is no exception. Elderly people and their loved ones should know how to protect against theft of assets.
The team at Newman Law Group, LLP can assist you if your loved one has been a victim of financial exploitation. We can help you and your loved one hold the person responsible for this type of abuse accountable. Contact us today to schedule a consultation. Call (916) 352-3181 or fill out the online form.
