Study Examines Scope of Elderly Financial Abuse

Study Examines Scope of Elderly Financial Abuse

Posted By The Maher Law Firm || 23-Feb-2015

When people hear the words "elder abuse," they usually think of the horrific cases of physical nursing home abuse and neglect reported in the news across the country. What is less talked about is the financial abuse heaped upon unsuspecting seniors every year.

According to a new study, the damage is much more costly than once suspected. Previous estimates suggested that older Americans lose $2.9 billion every year due to financial abuse. But the analysis by the financial services company, True Link, found that elder fraud is 12 times higher than the original figures, coming in at a staggering $36.5 billion.

This news is alarming for all families with loved ones in their golden years. After all, even able-bodied seniors with no apparent cognitive declines can be duped by scammers, relatives or people entrusted to provide financial monitoring.

Financial Exploitation Carries Serious Consequences

The consequences of financial exploitation are not only monetary. Elders may suffer psychologically when they become aware of the abuse and become depressed.

Due to shame and embarrassment, they may not report the financial abuse. As a result, the problem may not come to light until after all of their financial resources have been drained.

Sadly, the effects are also physical. As many as 954,000 older Americans are skipping meals as a result of financial abuse, the findings of the True Link study showed.

Who Commits Financial Abuse?

Financial abuse is perpetrated by a variety of different parties, not just family members. Con artists cheat seniors out of nearly $10 million each year, using tactics such as the fake lottery or infamous Nigerian prince scams. Elders are commonly victims of identity theft after giving out personal information to so-called bank representatives or other seemingly authentic parties.

Trusted caregivers are estimated to steal $6.67 billion from their elder charges every year.

How Children Can Prevent Elder Financial Abuse

In today's culture, it is common for sons and daughters to live far away from their aging parents, especially as more retirees settle in warmer places like Florida. From a distance, it is not easy to monitor who is writing the checks.

Even children who do make an effort to keep track of their parent's finances may not have an easy time doing so if the money is controlled by a financial advisor or other professionals in positions of trust, who may be skilled at covering their tracks.

Despite these challenges, it is important to have ongoing discussions with parents about their financial situations over time. You can frame the discussion in the context of helping them to plan for the future by communicating their wishes regarding money, durable power of attorney, advance medical directives and their wills.

In your talks, teach your loved ones not to give out personal information such as Social Security numbers, Medicare or private health insurance details and credit card numbers to people over the phone or that they have never heard of before. Follow the news as new scams surface and be sure to share that information.

Additionally, be cautious about who you hire to be a caregiver for your parent. In residential situations, wallets and checkbooks are easily accessible. It is easy for caregivers to steal directly or manipulate seniors from signing off on purchases that are not for them without realizing it.

Hire someone you feel you can trust, and don't hesitate to fire them if you suspect wrongdoing.

You should also consider hiring a caregiver who works through a bonded agency so that you can recoup your losses if he or she steals from your loved one.

You could also consider adding language to your hiring contract that the caregiver is not allowed to accept gifts from the senior or be left anything in his or her will.

If you believe that you or your elderly loved one has been victimized by financial abuse, The Maher Law Firm can assist you. Contact us today to learn more. We provide consultations that are free and confidential.

Blog Home