Protecting Seniors from Financial Abuse
A senior's golden years should be spent enjoying the financial nest they've worked hard to build. Unfortunately, elder financial abuse and fraud costs American seniors some $36.5 billion each year, according to the National Council on Aging (NCOA). Take the following steps to identify, prevent and report financial abuse of senior family members and friends.
1. Know Who Is At Risk
None of us is immune from falling prey to a smooth-talking financial con artist. Some things do put seniors at greater risk, though. Studies by the National Institute on Aging found that seniors had difficulty discerning visual cues distinguishing trustworthy from untrustworthy people. A study published in the Journal of Cognition and Emotion adds to this worry, suggesting that older adults are more likely to invest their money with people who have a reputation for being untrustworthy.
As we age, the risk of dementia also increases, and this may make seniors more susceptible to those who would take advantage of their diminished mental state. Seniors whose physical limitations require assistance either at home or in a care facility may be at further risk. Increasing trust and physical vulnerability are exactly what financial abusers are banking on.
2. Identify the Warning Signs
Unless you're managing the finances of an elderly relative or friend, it may be difficult to spot financial abuse. Warning signs include unpaid bills, overdrawn checks, disconnected utilities and duplicate subscriptions. A glance through the loved one's checkbook might show an unfamiliar signature. You might find contracts, for example deeding property to another relative, transferring long-held financial accounts to another firm or purchasing dubious investment portfolios. This is especially serious if your elderly relative doesn't remember signing.
If a once-chatty senior stops calling you, it may be a sign that an abuser has scared them into silence. If a caregiver controls who has access to the senior and limits the time you spend alone with them, this may be a red flag that abuse is taking place.
3. Spot Financial Abusers
The evening news often reports the latest financial scams we should all avoid, but these stranger scams make up only a small portion of how the elderly are financially abused. In fact, they're most often victimized by family or professional caregivers, according to the Alzheimer's Association and the National Adult Protective Services Association (NAPSA). Both offer detailed information on elder exploitation and tips for spotting financial and other abuse. According to the NAPSA, the list of potential abusers can also include neighbors, attorneys, religious leaders, medical professionals, friends and acquaintances, as well as financial services employees. Of particular concern are family and friends who are in desperate financial situations themselves.
4. Put Financial Safeguards In Place
Seniors may also be more at risk for identify theft, falling prey more easily to online phishing scams and requests for sensitive financial information, such as Social Security numbers. To prevent and catch identify theft, bank with financial organizations that provide fraud alerts, and choose credit cards with zero liability fraud protection. The NCOA offers a list of the top 10 financial scams targeting seniors and how to avoid them.
5. Report Financial Abuse
Elder financial abuse remains an increasing but under-reported crime, according to NAPSA. Seniors may be embarrassed by falling for a con, or they may remain silent out of fear. Often, the abuser has threatened them physically or verbally. If the senior lives with the financial abuser, they may also be victims of physical abuse. Eldercare Locator, a program of the federal Administration on Aging, and the National Center on Elder Abuse offer information on reporting all forms of elder abuse. Through IdentifyTheft.gov, consumers can report identity theft to the FTC and receive a free recovery plan.
Elder financial abuse is an unfortunate reality, but by taking these steps, you can work to prevent it. That way you can focus on spending quality time with your senior friends and family.