Sadly, elder financial abuse is widespread and can occur within families, among friends, and even behind the walls of care facilities. It can be difficult to identify, since it’s not often on our radars, yet it’s important to learn the signs, look after our loved ones, and know what to do when we see signs of elder financial abuse.
This type of abuse isn't physical, which is why it’s so tough to spot. A good way to get in ahead of potential issues is to have regular check-ins with the relative you are concerned about, learning about their unique situation, who’s in their life you don’t know well, and what red flags you can identify. This approach may seem like overkill; however, it will help you safeguard the financial well-being of your elderly relative. Use this guide to learn about, help prevent and, if necessary, put an end to elder financial abuse.
What Is Elder Financial Abuse?
Elder financial abuse occurs when someone manipulates or steals from a person who is older than them — whether it’s money, valuables, credit cards or even a power of attorney. Abusers can include family, friends, and even professional caregivers. Older people, especially those with dementia or Alzheimer’s, who experience a sharp decline in their executive-functioning abilities are most often the victims.
Executive-functioning abilities include:
- Capacity for following multi-step directions
- Ability to focus, particularly when faced with distractions
- Planning and meeting goals
- Self-control
- Flexible thinking
When caught quickly, damage can often be minimized, and the abuser can get into serious legal trouble. However, if it’s not caught in a timely manner, the effects of elder financial abuse can lead to the loss of a home or even a senior’s life savings.
Who Is Most at Risk for Elder Financial Abuse?
Seniors with dementia and Alzheimer’s often struggle to look after themselves. They may become confused easily, or get frustrated and struggle to think critically, making it easier to exploit them. Elders who are isolated from friends or family and those who have a new person playing a significant role in their lives are also vulnerable to elder financial abuse.
Those living in isolation don’t get regular visits and check-ins from loved ones, allowing abuse to go unchecked. Without frequent check-ins, it could be months or even years before the abuse is spotted. By that point, the damage may be severe. Sudden new friendships can also be a red flag. Would-be thieves may be looking for a new senior to latch on to, building trust by befriending them before exploiting them for money or another financial gain.
While the above senior groups are most susceptible to elder financial abuse, it’s true that anyone who has experienced a drop off in their executive functioning abilities is somewhat vulnerable.
Warning Signs of Elder Financial Abuse
Elder financial abuse can often be spotted by skimming financial information or by having a one-on-one conversation with the senior you’re worried about. By having a simple understanding of your relative’s finances, you may be able to spot trouble. Signs can include:
- Sudden or unexplained changes to the elder’s financial situation: Their account balance has dwindled, bills have gone unpaid, assets have vanished, etc.
- Unusual account activity: This includes unauthorized withdrawals, strange transactions or unfamiliar signatures on financial documents.
- Isolation and restricted access: Is your loved one isolated from friends, family, or trusted advisers or suddenly being restricted from managing their own finances?
- Fear or emotional distress: Look for signs of fear, anxiety, or depression when financial matters are discussed.
- Lack of financial knowledge: Sudden lack of understanding or confusion about finances.
- Involvement of unqualified individuals: Finding out an unqualified individual has taken an interest in your loved one’s finances can be a red flag.
- Granting financial access to others: Adding a joint owner to financial accounts — could be a relative or caretaker.
- Changes to beneficiaries: A sudden change to beneficiaries could be an indication of coerced decisions and not the senior’s genuine wishes.
- Sudden enrollment in online banking: This could tie into granting financial access and online banking activation without consent is a key indicator.
What You Can Do to Stop Elder Financial Abuse
Document any signs of trouble you now recognize, recording as much information as possible that you can pass on. Track changes to financial accounts and be organized. Who has power of attorney? Check your relative’s credit score, get them removed from solicitor mailings and cancel unused credit cards. You should also try and educate the senior you are worried about, helping them to be careful with the information they share and with whom.
If you suspect elder financial abuse – flag it as soon as possible. If the senior you think has been taken advantage of is in a care center, speak privately with facility management or report it by contacting adult protective services in their jurisdiction. You can also reach out to your loved one’s banking institution. Depending on the gravity of the situation, it may also make sense to report to the Elder Protective Services agency in your area or even local law enforcement. For more on elder financial abuse and other types of fraud, Select “FRAUD” in our dropdown to access more helpful resources.
This article is for informational purposes only. It is not intended to serve as legal, financial, investment or tax advice or indicate that a specific DCU product or service is right for you. For specific advice about your unique circumstances, you may wish to consult a financial professional.
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