Financial exploitation is the most common form of elder abuse, next to neglect and emotional abuse. About 12 percent of the crimes against older Americans involves financial abuse – unauthorized check cashing, coercing the elder to part with property, or diverting guardianship. Each year, senior citizens are swindled out of some $36.5 billion dollars by trusted individuals and caregivers, according to San Francisco-based True Link Financial.
The most common types of financial elder abuse include:
Most often, trusted individuals or unknown thieves use an elder’s checks, bank account information, or credit cards to obtain money without permission. In addition to money, valuables, medications, and personal property may be stolen. Carefully orchestrated identity theft can wipe out an elder’s entire life savings over a period of time. Older people may be viewed as easy, weak targets – pushed down and mugged on the street by pickpockets. Some thieves brazenly walk right into an elder’s home, claiming to be investigators looking for leaks or coming in to talk about switching utility service, but use distraction techniques to rob the house of valuables.
Criminals know that the elderly are particularly vulnerable to scams due to diminished hearing and increased confusion. Grandparent scams have been popular in recent years, where a perpetrator phones an elderly person, claiming to be a grandson or granddaughter in distress and in need of an immediate wire transfer. In another type of scam – the lottery scam — a perpetrator tells the elder a nonexistent lottery or prize has been won, with financial information required just to pay for shipping. Telemarketing scams convince elders to invest capital in bogus charities, nonexistent products, fake enterprises, or megachurches. Internet scams often come from foreigners requesting participation in a “business opportunity.” Service fraud involves taking money for work that is done improperly, partially done, or sometimes not done at all; this type of fraud is common, for example, with roof replacements after natural disasters.
Misuse of authority
Financial advisors may use their position of trust to convince elders to buy into expensive annuity scams, knowing full well that the money invested will not mature for 10-15 years – after the elder is likely to have passed away. Excessive trading activity and investments in high-fee funds designed to generate commissions for financial advisors are also common. These investment scams tend to peak around age 65. Misuse of authority by family members tends to come later. Caregivers who possess the power of attorney misuse their position to obtain a loan or withdraw money in an elderly person’s name, or make last-minute changes to the person’s property without consent.
Legal document abuse
Legal document abuse occurs when caregivers or other individuals trick an elder into signing over power of attorney when the elder lacks mental capacity to understand what is happening. Wills made when the elder is not mentally sound are a form of abuse. Elders are often tricked into signing paperwork that removes them from their property titles or adds the name of caretakers onto property and bank accounts. The elder may inadvertently make a dramatic and hasty change to a Will, Trust, or Transfer on Death Deed.
Extortion and manipulation
Loved ones may threaten, scare, or intimidate an elder into giving up assets or property. In one example, a female friend moved in with an elderly man who had memory issues. The woman claimed she was in the process of getting a divorce and needed a large sum of money for medical reasons. She used her undue influence to convince the man to write a letter stating that the money was a gift. She promised to repay the money once her divorce was final. In the end, she used the money for personal reasons and moved back in with her husband. Sadly, these stories of people preying on the emotions of the elderly and using their undue influence to extort are all too common.
Get representation from a financial elder abuse attorney
If you worry that a loved one has suffered some type of financial abuse, do not hesitate to contact an expert elder abuse attorney at KGG Law. We are experienced in these matters and bring the power of investigation to your case. We’ll help you uncover what really happened, blowing the lid off the abuse and bringing the full weight of justice to bear on the perpetrators. You only pay a pre-arranged legal fee if we bring your case to a successful conclusion.
Additional “financial elder abuse” resources:
- Indiana University East – Elder Abuse Fact Sheet, http://www.iue.edu/area9/Elder-Abuse-Fact-Sheet.pdf
- Mercury News – Senior Scams and Financial Elder Abuse Rampant and Grossly Underreported, http://www.mercurynews.com/2015/08/12/senior-scams-financial-elder-abuse-rampant-and-grossly-underreported-bay-area-prosecutors-say/
- Aging Care – How To Prevent 5 Common Kinds of Elder Abuse, https://www.agingcare.com/articles/how-to-prevent-5-common-kinds-of-elder-abuse-127186.htm
- National Adult Protective Services Association – What Is Financial Exploitation.
- CANHR – Financial Elder Abuse, http://www.canhr.org/factsheets/abuse_fs/PDFs/FS_FinanElderAbuse.pdf
- Hands On Banking – Examples of Financial Elder Abuse, https://handsonbanking.org/seniors/elder-financial-abuse/recognizing-financial-fraud/examples-of-fraud/
- AVVO – Elder Financial Abuse-Financial Extortion and Gift, https://www.avvo.com/legal-answers/elder-financial-abuse-financial-extortion-and-gift-771183.html
- Credit.com – Horror Stories of Elder Financial Fraud, http://blog.credit.com/2015/02/horror-stories-of-elder-financial-fraud-107857/
- WPBF – Thieves Target Elderly Women in Distraction Thefts, http://www.wpbf.com/article/thieves-target-elderly-women-in-distraction-thefts/8655428