The Definitive Guide to Elder Financial Abuse Prevention

elder financial abuse preventionFinancial abuse of the elderly is surprisingly common. We’ll share a few alarming statistics coming up.

First, here are the main types of elder financial abuse that you need to be on the lookout for- and that we’ll teach you how to spot!

  1. Theft of property or money
  2. Forging of signatures
  3. Convincing a senior to sign a deed, will, power of attorney or other legal document when it is not in their best interest
  4. Using a senior’s property without their consent
  5. Promising future care or services in exchange for money now, and not delivering on this promise
  6. Scams, fraud and any other deceptive or dishonest acts for financial gain

If you’re wondering how serious this issue is, five million Americans are subjected to elder abuse each year according to this report by the US Department of Justice.

A different report on elder fraud discovered that one in every five Americans over the age of 65 has been a victim of financial fraud.

Seniors can fall victim to financial abuse from total strangers, or those that they know very well- even a family member. In the next section you’ll learn how to spot the warning signs so you can protect your elderly loved ones from financial fraud and abuse.

The Warning Signs of Elder Financial Abuse

The first and most important thing when looking for signs of financial abuse is to trust your instinct and pay attention when notice anything that seems odd. The list below covers many possible scenarios, but don’t forget the most powerful tool you have is your familiarity with your elderly family member’s habits.

So if you notice anything out of the ordinary, or something that just doesn’t seem right, pay attention and consider it a warning sign! Here are the rest of the warning signs to look for:

  • Names being added or removed from legal documents, particularly when there is no obvious need for these changes.
  • Any contact from someone claiming to represent Medicare asking for personal information. This is the single most common form of elder financial fraud, and Medicare will NEVER request this information by phone or email.
  • Any sudden or unexpected changes to estate planning documents (such as a will or durable power of attorney).
  • Suspicious-looking signatures on checks or other financial documents (look at the handwriting on recent checks and compare it to an older handwriting sample from your elderly parent or loved one if you suspect any foul play).
  • Any unexplained withdrawals from bank accounts.
  • Any transfers between bank accounts or investment accounts that seem out of the ordinary.
  • Financial activity taking place at odd times or odd locations (such as an ATM withdraw late at night when you know your elderly parent is typically in bed by 8:00 PM).
  • Any sign that bills are not being paid on time even though your elderly parent or loved one has the financial resources to do so.
  • Missing belongings or personal property that is unaccounted for.
  • A lack of basic amenities in the home of your loved one, when they should be able to afford these items.
  • A family member has become secretive about your elderly relative’s financial details or activities.
  • A family member appears to be trying to isolate your elderly parent or relative from you or other family members.
  • Your elderly relative seems afraid to speak in front of a certain family member, caregiver or other companion.
  • You observe any type of sudden or unusual changes to your elderly relative’s financial situation (such as them losing the ability to make purchases that they would typically make).
  • Your elderly family member is making financial decisions or changes but does not seem capable of understanding the decisions.
  • You notice any purchase of items they cannot or would not need or use, such as a lifetime gym membership.
  • Any sudden increase in credit card offers and other offers in the mail (this could be an indicator that a caregiver or companion is misusing your elderly family member’s address to apply for credit cards or loans).
  • Mailings referring to lottery winnings or other false prizes.
  • Any notifications or mailings about suspicious investment schemes.
  • Any unsolicited or unnecessary home repair work being done.
  • Any bills or charges that far exceed the amount you would typically expect to pay for the service provided.

What To Do if You or a Loved One Is a Victim of Elder Abuse

If you suspect a senior is a victim of any type of fraud or elder abuse, you should get in touch with the authorities in your state so they can decide whether to investigate.

Every state has at least one toll-free phone number for reporting elder abuse and requesting help.

You can also contact the Administration on Aging, which is a federal agency dedicated to protecting the rights and safety of seniors. They can provide assistance, including sending a social worker to help you.

How to Prevent Elder Financial Abuse

So we’ve covered the warning signs, and what you can do right now if you suspect something is wrong.

But what can you do to prevent this from happening? There are a few basic steps that anyone can take to greatly reduce the chance of your aging loved ones falling victim to financial elder abuse, and we’ll cover them here…

1. Conduct Careful Evaluations of Caregivers

To be clear, caregivers are not particularly likely to commit acts of elder fraud. This isn’t meant to make you paranoid.

The problem is that when you do hire a caregiver, they’re in a unique position to commit acts of fraud if they intend to.

They often have access to important financial information, documents, and property that almost nobody else could access. And not just once, but on an ongoing basis.

So we recommend you have a thorough conversation before hiring any caregivers, and speak with references who have worked with that person for a long period of time.

2. Talk About the Warning Signs

Talk to your elderly family member (in a non-critical tone) about some of the most common dangers. If you don’t think it’ll go over well to present it as something that seniors need to be careful about, you can say that it is a danger faced by people of all ages, and something you recently read about. Or something that is becoming more common.

Here are a few of the big topics worth discussing prior to any warning signs:

  • Calls or emails from anyone claiming to represent Medicare asking for personal information are fraud 100% of the time.
  • Any mailings regarding contests, prizes, money or investment schemes should be closely examined and suspected as fraud.
  • Phone calls from people claiming to represent charities should be met with caution and you should never give your credit card to a charity over the phone.

3. Stay In Their Lives

You can’t be in position to notice changes or things that seem unusual if you’re never around. Stay involved in your elderly family members’ lives and you’ll be in a much better position to protect them. Have frequent conversations. If you’re not in the same location, do it by phone. Stay informed.

This helps you spot the warning signs much earlier, and also raises the chance that your elderly parent or family member will talk to you if they have a concern or aren’t sure about a decision.

4. Hire a Neutral Third Party

Finally, if you would feel safer having an expert watch over the finances of your aging family member, you can hire a neutral third party to protect and manage important financial accounts. We recommend using a Daily Money Manager, like us, and specifically one that is a member of the American Association of Daily Money Managers. You can read more about our services here.

 

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