It’s one of the most heartbreaking scenarios—a senior citizen has been fleeced out of a sum of money. Sometimes, it’s all they have and don’t know what to do to get it back.
Older adults are 15% of the US population. Every year, elderly citizens unwittingly lose billions of dollars to scams, fraud, and identity theft. These older adults have a tendency to be trusting of people, leading to financial elder abuse. Many of these victims don’t even understand how or why they were fleeced. They may fear retaliation from the perpetrator, especially if he or she is a family member, or maybe simply too embarrassed to ask for help.
How It Happens
Financial elder abuse can take many forms—some subtle, some brazen. Nearly any elder can be taken advantage of whether they are living at home, in an assisted living facility, “senior apartment,” or in a nursing home. They may not realize it until it’s too late.
Even elders who do not have a diminished mental capacity can still find themselves the target and the victim of a scam. The perpetrator can be a caregiver or in-home service person such as a cleaner or contractor who becomes overly friendly with them and gains their trust. More often than not, it’s a relative who sees the elder as a personal ATM or knows that they can always ask for and get money from a parent, grandparent, or other relatives who have a soft spot for them.
Signs Of Financial Elder Abuse
In the absence of blatant evidence, it’s important to keep an eye out for subtle signs of financial abuse, such as:
- New co-signers on any bank or brokerage accounts
- Unused bank accounts that suddenly have a new activity
- Withdrawals or other account activity that the elder doesn’t recall doing or authorizing
- Big charges on credit cards
- Unpaid bills, evictions, and cutoff notices
- Overdraft fees and/or ISF (insufficient funds) charges in a checking account
- Missing valuables, such as antiques or jewelry
- Address changes for account statements and other financial and legal documents
- Updates to a brokerage account that are in favor of another individual
- New mortgages, deeds, and/or contracts without explanation
- New beneficiaries and changes in wills, trusts, and other estate plans
- Questionable new changes and updates to any account that do not make sense
- They’ve signed a new POA but don’t understand it
- Insufficient medical care even with the ability to pay for it
- A new “friend” or online “significant other,” especially one that they send money to (called “catfishing.”)
Any activity that doesn’t “pass the smell test” should be investigated by you, your attorney or accountant, and possibly reported to the police.
Keeping Track Of Their Finances
This is the best way to watch over your elderly relatives’ financial situation. Create a system of checks and balances involving multiple steps and multiple people, not just one person.
When one or more individuals can offer oversight to an elder’s financial affairs, theft and other financial abuse is that much more difficult. Some ways to protect your loved one include suggestions from Forbes:
- Direct deposits and automatic bill pay, so that they don’t have to continue writing checks. It’s especially useful and safer if the elder has more than one form of income sent by checks that need to be deposited.
- Using credit cards for expenses and paying the card every month. Credit cards offer some protection from loss of cash, as well as identity theft. The company can review past charges and work to remove duplicate charges.
- Consolidate the number of accounts, including credit cards. This will make it easier to review and maintain the budget and finances, keep an eye out for fraud or other unusual activity, and ensure that everything is paid properly.
- Select an overseer to work with the elder, such as an adult child or other trusted relative. Get a power of attorney (POA) that allows the other individual to help with finances while he or she still has the capacity to sign one before the potential for mental decline occurs.
- Because many cases of financial elder abuse occur by family members, appointing an outside individual such as an attorney, accountant, bank or other non-family members can help protect them from ill-intended relatives.
- Review wills, trusts, and other estate planning documents. Check for new and updated wills, new beneficiaries, and other changes that don’t make sense.
If your loved one isn’t able to take care of their finances or has trouble keeping a handle on everything, it’s time to step in and help. You may just want to make sure they’re not spending what they shouldn’t, and that they haven’t unwittingly given control of some or all of their accounts to someone you may or may not know.
AARP offers this checklist to help you organize and keep track of your loved one’s financial affairs. Wayne State University’s Institute of Gerontology also offers free resources to those taking care of an elder relative’s money matters, including a Family & Friends Questionnaire.
You can also report elder financial abuse to the West Virginia Adult Protection Services, as well as file a police report with the local PD.
Stockbroker And Investment Fraud
It’s not uncommon for financial services representatives—some of whom may be over 60 themselves—to take advantage of their elderly clients.
Elderly investors who aren’t as sophisticated may be talked into “alternative investments” that they may not understand. They may be offered a deal that’s “too good to be true,” or be told about “guaranteed returns.” All securities come with a risk, and no return is guaranteed.
Many of these dishonest representatives create fictitious accounts and statements they provide to show their clients how well their “investments” are doing. Unfortunately, the financial advisor or broker has simply deposited their client’s check into personal or other accounts over which they have control. Known as “converting funds,” it simply means that the broker or representative used the client’s money for their own personal expenses or an unauthorized business venture outside of their firm.
The Financial Industry Regulatory Authority, Inc., known as FINRA, is an agency created by Congress that oversees the industry. The goal is to ensure that the markets and the industry operate in a fair and honest manner. You can investigate any investment advisor, broker, and financial services firms online and free at FINRA’s BrokerCheck website. FINRA also has a senior helpline dedicated to assisting seniors and their families with questions or concerns about investments and brokerage accounts.
Financial Abuse Of Your Elderly Loved One? Call A Charleston, WV Elder Law Attorney
It’s not an easy thing to know that someone has taken advantage of your loved one’s finances. From small bits of change to credit cards, loans, and co-signed bank accounts, you may not find out about the problem until it’s too late. They need you to advocate for them.
You have a two-year timeframe to file a lawsuit on behalf of your loved one. If you believe your loved one has been financially harmed by a family member, a nursing home employee, or another individual, you need help fast. Contact The Love Law Firm today at (304) 344-5683 to schedule your free consultation with a Charleston, WV nursing home attorney. (You can also email us or use our convenient contact form.) We advocate for Charleston’s vulnerable elderly.