As part of our continuing series on financial abuse, we’ll be discussing elder financial abuse and exploitation. If you suspect you or someone you know is being financially abuse or exploited, please contact your state’s Adult Protective Services. A clickable map can be found here: http://www.napsa-now.org/get-help/help-in-your-area/
When we talked about financial abuse, we noted that 99% of domestic violence victims are also victims of financial abuse. And while that is a staggering statistic, there are two that rival it: one in twenty older Americans are victims of financial exploitation, and 90% of abusers are family or caregivers (National Adult Protective Services Association).
Since it’s such a common problem, and one that might even occur in your own family, let’s break it down so you can recognize what it is and how to protect yourself or loved ones against it.
What is financial exploitation?
Financial exploitation is defined as the illegal or improper use of a vulnerable or elderly person’s property, funds, and assets. This can look like stealing property, forging signatures on checks, cashing checks without permission, or using money to control the individual in their care.
It also includes using illegal or unethical means (i.e., scams) to gain access to an elderly or vulnerable person’s banking account and other financial assets.
Who is victimized by financial exploitation?
For the purposes of this discussion, we will focus on the elderly as victims of financial exploitation and abuse. However, this also includes vulnerable populations such as children, those with traumatic brain injuries, and adults with diminished capacity.
According to Brenda K. Uekert, PhD, former director of the Center for Elders and the Courts and blogger at The Five Journeys, when discussing vulnerable populations, age is not a factor. A person can be vulnerable but not elderly.
It’s important to note that there is no specific definition or age guideline for what is considered elderly. Most states have their own guidelines for determining who is a senior citizen, and federal programs have their own as well. This does not detract from the severity of the issue, but if you suspect someone in your family is being financially exploited, check with your state’s guidelines for what is considered elderly.
If you choose to prosecute, this could mean the difference between misdemeanor or felony.
Why target the elderly or vulnerable?
Cameron Huddleston, author of Mom and Dad, We Need to Talk: How to Have Essential Conversations With Your Parents About Their Finances, the elderly are targeted because they are seen as a source of income. Those in caretaking positions, whether family or hired, often see the elderly as having large, consistent amounts of income in the form of savings, Social Security checks, and pensions, and that makes them easy (and reliable) targets. And, when it comes to scammers, women tend to be more polite. They don’t want to hang up or be rude, making them more susceptible.
Uekert furthered that the elderly, specifically elderly women, are targeted because they are more trusting. They want to see the good in their caretakers, and don’t believe that their son or granddaughter would steal from them. While trust is generally a good trait, when it comes to your finances, you have to look out for you first. This is your money; you cannot worry about offending anyone.
This trust issue is a big reason why elder financial exploitation is underreported. Not only is it incredibly difficult to prosecute, Uekert said, but people are embarrassed that they’ve been taken advantage of. They might also not realize they are victims. And if they do realize it, they don’t want to admit it.
What are the signs?
Since people might not know that they are being victimized by a caregiver or family member, it’s important to recognize the signs. This way, if you see some of them, you can address it with that person and hopefully come up with an action plan to halt the exploitation and/or abuse.
It is important to note that financial exploitation of the elderly can happen for many reasons, but two common ones identified by the Delaware Adult Protective Services are financial burdens related to taking care of an aging parent and the financial dependency on an older adult by the caregiver. Uekert said that financial exploitation can occur concurrently with other signs of abuse, such as neglect or physical abuse.
Where can it happen?
While financial exploitation can happen in the home, whether by an in-home caregiver or relative living with the elderly person, it can also happen in nursing homes, assisted living facilities, or by friends.
It can also happen over the phone, email, or even through social media. This is mostly via scams but it is not unreasonable for a long-lost relative to use one of these methods to financial exploit an elderly person.
What are the warning signs?
As with partner financial abuse, the warning signs of elder financial exploitation include:
- Missing possessions, credit cards, or jewelry
- Alienating the elderly person from family and friends by emotional manipulation or isolation
- Parent or elderly person suddenly complains about no money or expressing concerns over money, when they had not previously done
- Medical care needed but caregiver is resisting providing or obtaining it
- Caregiver seems suddenly flush with cash but nothing about their financial situation (ex., obtaining new employment) has changed
Huddleston stated that many of these signs are related to the abuser wanting to keep as much money for themselves as possible. In other words, they see spending the money on expenses or medical care as drawing against their future inheritance or funding their current needs.
She also mentions that you do not have to have access to the person to commit financial exploitation. All you need is access to their money. Uekert agreed with this, adding that financial exploitation can occur through legal means such as conservatorship or power of attorney.
Which is why it is crucial that you have measures in place to protect you, or your older family members, from being exploited.
What about scams?
Yes, phone and email scams are a problem. There are those who will call or email and try to collect personal information from the elderly and vulnerable in order to steal money from them. But in the overall discussion of financial abuse and exploitation, that occurs with less frequency than caregivers or family members stealing money.
We generally don’t discuss caregiver abuse because of the shame and stigma attached to it, Huddleston said. Uekert added that we have a distorted perspective of the nature of financial exploitation because caregiver abuse is a less attractive news headline than scammers stealing money from elderly women. But the reality is, that while scams happen, they occur with much less frequency than we are led to believe and the real problem begins with friends and family.
How can you protect yourself or loved ones?
Although conservatorships and power of attorney lend themselves to be avenues for financial exploitation, they are the primary way to protect yourself from such a situation. Huddleston emphasizes the importance of power of attorney (POA), and recommends that you take is as seriously as you would selecting a guardian for your child.
Since a POA can lead to financial exploitation, she recommends have two people named, and put measures in place to make sure there is checks and balances between the two. They need to keep each other informed, make decisions together, and the elderly relative needs to outline concrete expectations for their POA. It is also essential that you make sure you have a copy of your POA document, and that document must be a notarized, physical copy, and kept somewhere safe.
If a family member has no one they trust to put as their POA, then she suggests that person use a lawyer or financial professional as their POA instead. Because, as Huddleston says, if you do not pick who you want, someone will be appointed, and that could be the very last person you’d want managing your money.
Other ways to protect yourself or loved one against financial exploitation include:
- Shredding receipts and bank statements, especially if you have in-home caregivers
- Conducting background checks on all in-home caregivers, nurses, etc.
- Consulting with an attorney or trusted person before making a large purchase
- Adding your phone number to the Do Not Call registry
Finally, Uekert recommends using technology to help guard against financial exploitation. For instance, Eversafe is a third-party alert system you can use as an oversight on your bank accounts. It will alert you about anomalies in spending or withdrawals, late payments, and other inconsistencies that might indicate financial exploitation.
There are a number of safeguards you can put in place to protect yourself from financial abuse, but the important thing is that you start now before you can’t confidently and competently make decisions about your finances or recognize the signs of exploitation.
Elder financial abuse and exploitation is, unfortunately, all too common. Seniors are easy targets, prosecution is difficult, and it more often than not goes unreported. However, if you learn the warning signs and safeguards you can put in place, you can prevent yourself or loved one from becoming a victim.
For more information about elder financial exploitation, visit http://www.napsa-now.org/policy-advocacy/exploitation/