Financial Abuse and Exploitation: Signs and Prevention
Elder Financial Abuse and Exploitation is one of the most devastating challenges many seniors face. It rips at the very fabric of their financial independence and security in the years they most need peace of mind. Millions and millions of dollars have been lost to criminals who find unique ways to take the life savings and daily income from those most vulnerable.
Financial elder abuse is a crime, and it is on the rise. The related costs (such as health care, social services, investigations, legal fees, prosecution, and lost income and assets) for older Americans exceeds $2.6 billion annually. Elders can be taken advantage of or abused in a variety of ways, including physically, emotionally, sexually, and financially. Other forms of abuse are often overlooked when focusing just on the financial abuse picture.
Understanding the Differences
It is important to understand the distinction between elder financial abuse, as traditionally defined, and frauds and scams committed against seniors. These are very different crimes, committed by different people, with different dynamics, and with different investigative and prosecution barriers.
What is Elder Financial Abuse?
Elder financial abuse, as traditionally defined, is the theft of property, cash and resources of an older person committed—in most part—by a family member, caregiver or someone in a position of trust. The use of coercion, intimidation, isolation, force, threats and “undue influence” is unique to this type of abuse, and because it is often perpetrated by a caregiver or family member, it is a difficult crime to investigate and prosecute. The cooperation of the victim is not always forthcoming in many of these cases: Dependent seniors fear of losing their only caregiver and/or the possible prosecution of a family member.
Financial abuse is one of the most underreported crimes due to the victim’s embarrassment, fear of loss of independence, intimidation by the perpetrator and widespread lack of awareness that it is a crime. Victims of elder abuse, neglect and financial exploitation are 3.1 times more likely to die at an earlier age than are those not victimized. Victims rarely recover financially, and losses often lead to depression, increased physical problems, reliance on public benefits and even death.
What Are Frauds and Scams?
This type of financial exploitation is usually a “stranger crime”—committed by individuals not previously known to the victim. Therefore, the dynamics of the crime are different and require a different type of intervention.
One in five senior citizens has been victimized by financial fraud. They are targets for a variety of reasons: Typically, they are likely to have excellent credit and own their home. They are unlikely to report a fraud because they are often unaware they’ve been scammed or are ashamed they’ve been defrauded.
Examples of Scams and Frauds
There are hundreds of scams and frauds, but there are some more commonly seen than others. These include health care/insurance fraud, door to door sales/repairs, funeral/cemetery fraud, counterfeit prescription drugs, telemarketing frauds, fraudulent “anti-aging” products, internet frauds, The Grandparent Scam, investment scams, reverse mortgage scams, home/driveway/roofing repairs, Medicare/Medicaid scams and many others.
Tips to Avoid the Most Common Scams
- Start with Trust: Find a business you can trust by doing your research first through The Better Business Bureau (bbb.org).
- Beware of high-pressure sales tactics: If someone is pressuring you to make an on-the-spot decision without allowing you to research first, be prepared to walk away from the offer.
- Be wary of unsolicited correspondence: Government agencies, credit card companies and banks will never ask for personal information through email or over the phone. If you get a call asking for personal or financial information, offer to call the person back so you can research the information they provide to you.
- Use secure payment methods: Never send money by wire transfer to someone you don’t know. Use a credit card for additional protection.
- Safeguard your personal information: Avoid sharing your social security number, bank account information, birth date or address to someone you don’t know or trust.
- Report fraud: If you think you may have fallen victim to fraud, contact the Better Business Bureau online or over the phone. File a complaint with the Attorney General, Consumer Frauds Division.
How Banks and Financial Institutions Can Help Detect and Prevent
Bank employees are in a unique position to have early knowledge of financial abuse of elderly and impaired adults. Bank employees with customer contact often see situations develop where they believe that the customer is at risk. An employee needs to be aware of suspicious behaviors or banking activities that may indicate financial abuse is occurring. Banks can help protect their customers by establishing a protocol for employees to identify and report suspicions of elder/impaired adult financial exploitation to a designated manager at the bank. The manager will decide if there is sufficient reason to make a referral to Protective Services for Adults or, in an emergency, to the police.
Where To Go For Help
- National Center on Elder Abuse (NCEA): The NCEA is a resource for public and private agencies, professionals, service providers, and individuals interested in elder abuse prevention information, training, technical assistance and research. Phone: (855) 500-3537
- Your Area Agencies on Aging: Area Agencies on Aging (AAAs) provide support for older adults, their families, and caregivers through advocacy, information and services. Programs and services offered for vulnerable older adults vary by locality but often include a long-term care ombudsman and an elder abuse prevention specialist. Check your local telephone directory.
- Your local Department of Social Services
- Your local Legal Aid Society
- Adult Protective Services: Adult Protective Services (APS), present in all 50 states, is designated to receive and investigate allegations of elder abuse and neglect. Each state has a primary agency that houses APS. It may be the Area Agency on Aging, the Division of Aging, the Department of Aging or the Department of Social Services
- Medicaid Fraud Control Units (MFCU): Each state attorney general’s office is required by federal law to have an MFCU that investigates and prosecutes Medicaid provider fraud and patient abuse and neglect in health care programs and home health services that participate in Medicaid. Contact information for individual state MFCUs is available online.