Lifestyle + Wellness | Financial Literacy continued...
and exploitation as “The Fraudulent or otherwise illegal, unauthorized, or improper act or process of an individual, including a caregiver or fiduciary, that uses the resources of an older individual for monetary or personal benefit, profit, or gain, or that results in depriving an older individual of rightful access to, or use of, benefits, resources, belongings, or assets.” Simply put, elder financial abuse involves taking advantage of an older person for financial gain, regardless of motive. Financial exploitation can often be more challenging to detect than other forms of abuse. While this is not always the case, it is ubiquitous for financial abuse to be carried out by family members, friends, caregivers, or other trusted individuals that are in the victim’s life. One of the most common types of financial abuse that takes place from individuals close to the victim includes a caretaker using checks, debit, or credit cards to withdraw money or make purchases without the victim’s permission. However, more dangerous and repugnant forms of financial abuse are also commonplace. This includes threats of violence in exchange for money or assets, or worse, a family member, friend, or caregiver withholding care unless they receive an exchange of money or neglecting their caregiving responsibilities while still collecting full payment. Other perpetrators can also carry elder financial abuse, such as impersonators who claim to be associated with lotteries, law enforcement, the IRS or government offices, charities, or email phishing scams. Other common types of financial fraud targeted at elderly individuals include predatory lenders and identity theft. Why does elder financial abuse happen? Several factors make seniors especially vulnerable – while an age-related decline in cognitive abilities makes some elderly individuals an easy target for abuse, there are other reasons. Older individuals tend to have a higher net worth than younger generations, and the concentration of wealth in this age range makes them desirable targets for those with dishonorable intentions. Another factor that comes into play is the potential for
a declining financial capacity. Depending on the level of cognitive decline with age, an older adult may have trouble making sound financial decisions. Elder financial abuse is an issue that should be taken seriously. Thankfully, some things can be done to recognize elder financial exploitation and protect our loved ones from this abuse. Financial abuse can be difficult for victims or family members to identify and report. Here are a few things you can watch for: Sudden changes in bank accounts or credit cards, such as names or authorized users added without your knowledge or consent Finding unpaid bills or past due notices, although you have sufficient financial resources to pay for your discretionary and non-discretionary expenses Previously uninvolved relatives showing up to claim rights to an elderly person’s property or assets Sudden transfer or attempted transfer of assets to someone outside of the family An unusual change in spending habits An elderly individual suddenly acting worried or stressed about financial matters Elder financial abuse is preventable. Here are a few ways you can protect yourself or an elderly loved one: Avoid joint bank accounts. While it may seem like a good idea to open a joint bank account for your family or caregiver to access funds to help you manage your finances, you should avoid a joint bank account at all costs. Joint bank accounts are an easy way for theft and financial abuse to occur. Remain socially active. Isolation contributes significantly to vulnerability, as being secluded from friends and family can make it difficult for others to identify and recognize signs of abuse. Seek outside perspectives. Consult your wealth advisor, attorney, or another trusted advisor before making significant investments or purchases. Require background checks. If hiring individuals to provide in-home care, it is vital to have the person properly screened, including a criminal background check.
Use technology to stay connected and informed. Consider enrolling your elderly loved one in mobile banking and setting alerts and notifications to be sent to them whenever a transaction is made or their balance falls below a certain amount. This can help them stay informed, feel in control of their finances, and quickly identify charges they did not authorize. If you suspect you or a loved one is a victim of elder financial abuse, you should report it to the appropriate agencies as soon as possible. The Consumer Financial Protection Bureau’s website offers additional resources about elder financial abuse, resources, and contact information based on the type of financial abuse that needs to be reported.
Sources 4 https://www.ncoa.org/article/get-the-facts-on-elder-abuse 5 https://www.ncsl.org/research/financial-services-and-commerce/combatting-elder-financial-exploitation.aspx 6 https://www.ncbi.nlm.nih.gov/books/NBK98784/
8 PERSPECTIVE Summer 2023
PERSPECTIVE Summer 2023 9
Made with FlippingBook Online newsletter maker