The High Price of Elder Financial Exploitation
April 28, 2015
If you think financial scams against the elderly are a petty and insignificant crime that will never happen to your loved one – think again.
The National Adult Protective Services Association currently describes elder fraud as a “rampant, largely invisible, expensive and lethal problem” with roughly five million affected elders every year.
Current estimates put the number of annually stolen funds at three billion with victims averaging a financial loss of anywhere between thirty thousand to one hundred thousand dollars.
Adding to the pain of this crime is the reality that these stolen funds are rarely recoverable – and for someone in retirement the loss of such large sums of money can be the difference between success and failure in their entire eldercare plan.
Why are criminals finding our seniors to be “easy targets”?
The list is long, but top reasons are that many times our elders are suffering from mild to medium cognitive disabilities; they can be lonely and isolated which clouds their judgment of whom to trust; they have a steady stream of income such as social security or annuities which are attractive to thieves, and many times they are just too polite to question the circumstances that lead up to financial exploitation.
Unfortunately, our family has become one of the victims of senior financial fraud. What we have learned from the experience is both shocking and life changing.
The sad reality is that the vast majority of scams and theft against the elderly are perpetrated by someone they know – a family member, friend or caregiver.
This was the case in our situation. While it has been hard to track the exact amount of money lost as “loans to a friend never paid back” we know of at least sixty thousand dollars in the past eighteen months and probably close to two hundred thousand dollars since 2005. Even more frustrating, the red flags that our loved one was being scammed were there – our family simply didn’t recognize them.
Once exploitation is discovered, it should be easy to stop – but it’s not.
The system that protects our elders has an extremely limited ability to go after predators. In our case, Family Protective Services (FPS) investigated the situation, but since our Uncle is not considered incompetent, there is no action they (or we) can take to stop him from loaning his money to a deliberately, unscrupulous friend; they can only act if the abuser is in a legal or official capacity to manage our Uncle’s money.
Once we hit a standstill with FPS, we went to the fraud department within local law enforcement. It’s been three months since we contacted the police to file a complaint. In those three months they have had no progress to report, though they insist they are working on the case. We continue to watch, wait and hope for resolution.
In the meantime, we have been working closely with the other elder members in our family to educate them of the risks – because in the end prevention is the only truly viable solution.
With that in mind our entire family is reviewing the Money Smart for Older Adults workbook with the goal to protect our loved ones personally and financially. The 53-page guide is downloadable on line and can be found at http://files.consumerfinance.gov/f/201306_cfpb_msoa-participant-guide.pdf.
A recent article on CBS News Money Watch details warning signs that a fraud may be in progress – it’s important to review them and beware: http://www.cbsnews.com/news/the-growing-danger-to-elderly-americans/
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