Financial fraud is fast becoming a normal part of life, but for seniors it can have truly devastating effects. According to the FBI Elder Fraud Report 2022, more than 88,000 people over age 60 were victimized with the average loss at $35,101. Even seniors who are on top of their finances can be exploited and may be so embarrassed that they don’t tell anyone, making a bad situation even worse.
To better understand and combat the possibility of elder financial abuse, here is a look at what it is and ways to limit risk.
Stories of caregivers stealing from their clients are not uncommon as are those about family members taking over bank accounts and maxing out credit cards. Family members are in fact among the most common perpetrators of elder financial abuse, but according to the forbes.com article, “What Is Elder Financial Abuse—And How Do We Prevent It?,” it is also wise to be wary of new friends who seem too controlling.
Today, however, elder financial abuse can be by someone unknown who attacks via the internet or over the phone. According to the FBI report, the 10 most common forms of elder financial abuse are:
Although anyone of any age can fall prey to scammers, the FBI report notes that people over age 60 are the second most likely group to be duped (behind those age 30-39) and the associated losses are far more than any other age group totaling more than $3 billion in 2022, up 84% from 2021.
There are red flags to look for if a senior has become a victim of financial abuse. One of the easiest to spot is unpaid bills piling up (and utilities being shut off) which can mean the money to pay them is not available. Other warnings include changes to wills, disappearing valuables, and mood or behavior changes that are unusual.
One of the most common signs of elder financial abuse, however, is when someone – friend, caregiver, or family member – seems to be taking over a senior’s life. These people often try to keep others at bay because they are helping themselves to a senior’s assets. This is especially common when a senior is isolated and reliant upon one person to see to their needs. When someone seems to have more control than the family likes it can mean they have something to hide.
Of course, the most vulnerable are seniors who are physically or mentally disabled and unable to protect themselves. They may even believe the person exploiting them is their best friend and would never harm them. Get the facts in the money.usnews.com article, “Elder Financial Exploitation: Warning Signs, Prevention and Reporting.”
Protecting a loved one from elder financial abuse should begin as early as possible and include setting up legal financial power of attorney so someone who is trustworthy can keep an eye on finances and step in if a senior needs representation.
If a senior seems upset or concerned about money or if any red flags occur, take time to discuss the situation in person and try to get to the root of the problem. This is also a good time to review unpaid bills and financial statements to pinpoint where money is going.
According to the aarp.com article, “5 Ways to Prevent Elder Financial Exploitation,” seniors can also enroll in programs that monitor and track accounts and notify them when suspicious activity is occurring.
When elder financial abuse has occurred it’s essential to report it immediately. The Consumer Financial Protection Bureau article “Reporting elder financial abuse,” recommends reporting to the following:
Depending on the circumstances of the elder financial abuse, it may also help to contact banks, the local offices of Social Security and/or Veterans Affairs, the Federal Trade Commission, the U.S. Post Office, and for internet crimes, the FBI Internet Crime Complaint Center.
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