Financial Elder Abuse

Financial elder abuse is defined as the fraudulent use of an older individual’s resources for personal benefit. As with other forms of abuse, financial elder abuse often goes unreported, with only one in 44 cases being documented, according to the National Adult Protective Services Association. Therefore, it’s important to monitor the financial affairs of loved ones who may be at risk.

What Is Financial Elder Abuse?

Financial elder abuse, also called financial exploitation, is a crime that deprives older adults of their own resources, often through misrepresentation of having their permission.

Elder financial abuse can include:

  • Improper use of an individual’s assets or credit cards
  • Manipulating an individual  to gain control of their money or property
  • Neglecting to pay an older adult’s rent, taxes, or medical bills
  • Theft and fraud

This type of elder abuse may also take the form of health care fraud when doctors and other health care workers overcharge, double bill, falsify Medicare claims, or charge for care they never provided.

Further, technological advances have put the whole world at increased risk for phone or email scams — and the elderly population is most susceptible.

Helping your loved one take simple steps to safeguard their financial decisions and knowing the warning signs is the best way to prevent financial abuse of an elder.

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Who Engages in Elder Financial Abuse?

Sadly, those who engage in elder financial abuse can play any number of roles in the victimized senior’s life. Due to the perception that elderly people are easy targets, financial exploitation of the elderly may come from pretty much any person looking for easy access to money.

People who may commit elder financial abuse include:

  • Attorneys
  • Bank and other financial institution employees
  • Caregivers
  • Doctors, nurses, and other health care providers
  • Family, friends, and acquaintances
  • Financial advisors and other financial service providers
  • Neighbors
  • Religious figures, such as pastors

Because of the wide range of people who have been known to commit financial elder abuse, it is very important to keep an eye out for your loved one’s financial wellbeing.

Financial Abuse by Friends & Family

Almost 90% of elder financial abuse happens in domestic settings. The abuse is usually perpetrated by adult children, other family members, and friends.

According to the National Center on Elder Abuse (NCEA), 57.9% of financial elder abuse perpetrators were family members and 16.9% were friends and neighbors.

To complicate matters, financial elder abuse by family and friends is not necessarily straightforward theft.

Family and friends commit elder financial abuse because:

  • An heir may feel that taking it is the best course of action to conserve money
  • They have a poor relationship with the elder and feel entitled to “payback” for past abuse
  • They may feel they are entitled to be reimbursed
  • They may know they will legally inherit assets and think it is okay to take an “advance”

While there is never any true justification for elder abuse, in cases of financial elder abuse, the motivations of the abusers can be a bit more complicated.

Financial Abuse by Strangers

Although most cases of elder financial abuse involve people who the victim knows and trusts, it is also likely for strangers to be perpetrators.

Scams that are often performed by strangers include:

  • Annuity sales that do not make financial sense based on advanced age
  • Claiming to be from a utility company to get inside a home to steal from it
  • Collecting money for charities that don’t exist
  • Embezzlement
  • False claims of lottery and sweepstake winnings aimed at collecting money for “taxes”
  • Grandparent scams (elder is told grandchild is in danger and needs money)
  • Home repair, yard work, and roof repair scams
  • Identity theft
  • Internet phishing
  • Investment, securities, or pyramid schemes
  • Medicare scams
  • Predatory lending

Financial Abuse by Care Providers

In addition to family, friends, and strangers being the perpetrators of financial fraud, in-home care providers may also be guilty.

Care providers may commit financial abuse by:

  • Asking the elderly individual they care for to falsify timesheets
  • Charging extra for services that are already included in the care agreement
  • Keeping the change when running an older person’s errands
  • Paying their own bills with the money of the person they are caring for

When financial exploitation occurs in a long-term care facility, it is considered a type of nursing home abuse.

Elders Most at Risk for Financial Abuse

In a report published by the National Institute of Justice (NIJ), there were some patterns common to those people most at risk.

Those most at risk of elder financial abuse:

  • Do not have dementia or confusion
  • Have abusers with reliable social support of their own
  • Live independently

While these characteristics may seem counterintuitive, it goes to show that elder financial abuse can be extremely difficult to detect.

Why Are the Elderly Targeted?

The elderly are targeted for financial abuse because they tend to be trusting and well-mannered. They also typically have money, property, and good credit. The combination of these factors makes them prime targets for financial predators.

According to AARP, older Americans are estimated to have accumulated $18 trillion in assets, making them attractive targets for theft and fraud.

Additionally, the elderly population may be less likely to know how to properly report financial abuse. They may also wish to not report it because they don’t want family members to lose confidence in their ability to live independently.

Warning Signs of Elder Financial Abuse

While elder financial abuse can be very difficult to catch, there are some warning signs that can help families stay alert.

Warning signs of elder financial abuse include:

  • Altered wills and trusts
  • ATM withdrawal activity allegedly made by someone who has never used an ATM
  • Closed CDs or other long-term accounts without concern over penalties
  • Diminished health or mental capacity of the elderly individual
  • Disputes regarding future inheritance
  • Efforts to make the senior change their power of attorney, will, or trusts
  • Financial transactions that the senior has difficulty explaining
  • Newly designated powers of attorney
  • Newly occurring insufficient fund activity or unpaid bills
  • Refusing to make eye contact when the topic comes up
  • Suspicious signatures on checks
  • Unexplained attempts to wire large sums of money
  • Unplanned personal property loss
  • Unusual bank account activity

While it may be awkward to ask loved ones for visibility into their personal financial affairs, even having very limited access can prove incredibly helpful if you know what to watch out for.

Warning Signs from the Abuser

Some red flags that elder financial abuse is at play include:

  • Individuals developing increased interest in an elderly person’s assets
  • People close to the older individual have a history of addiction
  • People with chronic financial problems suddenly becoming close with the senior
  • Someone insisting on being granted power of attorney
  • The sudden appearance of new “best friends”

How to Report Financial Elder Abuse

If you suspect financial abuse, the first step is to talk with your loved one. If you can, determine the specific type of financial abuse that is occurring. This should provide some clues into who is committing the abuse.

Some additional steps to take include:

  • Contact Adult Protective Services (APS) in your loved one’s city or town
  • Report the elder abuse to your loved one’s bank with a request to help stop it
  • Report the financial elder abuse to law enforcement, such as the local police

Even if your loved one has full mental capacity, elder financial abuse can still be proven. It is not necessary for cognitive problems to be present to prove an elderly individual has been victimized.

Get more information about reporting financial abuse by contacting our team.

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Statistics About Financial Elder Abuse

According to the U.S. Department of Justice (DOJ), financial elder abuse is one of the most common forms of elder abuse.

Some sobering financial elder abuse facts include:

  • 1 in 20 older adults have reported elder financial abuse.
  • 90% of perpetrators of elder financial abuse are family members or other trusted acquaintances.
  • According to the NIJ, about 5.6% of a sample group of 2,000 seniors living independently were victims of financial elder abuse.
  • Independent seniors are 66% more likely to experience financial abuse only (without other forms of abuse also occurring).
  • The most common types of elder financial abuse are: having someone steal money, sell/take property, and forgery.
  • The National Center on Elder Abuse estimates that financial elder abuse costs its victims about $2.9 billion annually.
  • Nearly one in ten financial elder abuse victims will need Medicaid as a direct result of their money being stolen.

What’s worse is the fact that most financial elder abuse goes undetected, which paints an even starker picture about the true scope of the problem.

Other Types of Elder Abuse

Elder abuse occurs when there is an expectation of trust that gets violated, causing an older person harm or distress. Elder abuse is sadly all too common.

“Rates of elder abuse are high in institutions such as nursing homes and long-term care facilities, with 2 in 3 staff reporting that they have committed abuse in the past year.”

– World Health Organization (WHO)

The WHO characterizes elder abuse as: physical, emotional, sexual, financial, and neglect.

Physical Abuse

Physical abuse is the intentional use of physical force that may cause injury, pain, or impairment. It can include hitting, pushing, shaking, beating, slapping, kicking, and burning. Physical elder abuse can also include unnecessary use of physical or chemical restraints.

Emotional Abuse

Emotional abuse is causing pain, distress, or anguish through acts such as insults, verbal assaults, threats, intimidation, isolation, and harassment.

Sexual Abuse

Sexual abuse includes any non-consensual sexual contact, including touching, assault, harassment, or any sexual interaction with elderly people who lack the capacity to give consent.

Nursing Home Neglect

Nursing home neglect is the failure to provide such necessities as food, water, clothing, medications, comfort, and personal safety by a long-term care facility that has the duty to do so.

Filing a Nursing Home Financial Abuse Lawsuit

Filing a nursing home lawsuit for financial abuse can be a very effective way to recover stolen money and get justice for the loss of dignity that victims suffer.

The effects of financial elder abuse can be broad, often including:

  • Becoming reliant on government programs
  • Depression, fear, shame, and worthlessness
  • Inability to cover long-term care
  • Inability to replace lost assets
  • Loss of ability to trust others
  • Loss of primary residence
  • Loss of Social Security benefits

If you suspect financial elder abuse, you may wish to contact your local APS agency. You may also wish to hire an attorney who can file a lawsuit for you and your loved one.

Nursing home abuse attorneys typically work on a contingency fee basis, which means you do not pay unless they are successful. In addition to financial compensation, you may be awarded punitive damages, which are designed to prevent further financial abuse of the elderly.

Learn how to get justice after elder financial abuse occurs — get a free case review.

You deserve justice. Get a free legal case review now.

Author:Nursing Home Abuse Justice Team
Nursing Home Abuse Justice Team

Nursing Home Abuse Justice was founded to shine a light on nursing home and elder abuse. Every day, thousands of people in nursing homes and assisted living facilities are abused. Our team helps educate seniors and their loved ones on the common causes, signs and preventions of nursing home abuse. We report on real-world studies and current events from respected news outlets to expose this national problem.

Last modified: June 9, 2021

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