Recognizing and Preventing Financial Exploitation Targeting Seniors
As the baby boomers move steadily into their golden years, approximately 1 in 10 will find themselves the victim of financial exploitation. A MetLife study estimated that financial exploitation costs U.S. seniors approximately $2.9 billion annually. A later study by Allianz Life found the average victim loses $30,000. Despite increased awareness and better safeguards, the problem of senior financial exploitation continues to grow.
Following the findings of Mark S. Lachs, M.D., M.P.H., the New England Journal of Medicine warned physicians, “Financial exploitation has recently been identified as a virtual epidemic.” While determining the prevalence of predatory behavior aimed at seniors can be challenging, experts agree that 1 in 10 seniors will experience financial exploitation during any given 12-month period.
Factors that Contribute to an Increased Risk of Financial Exploitation
There are four key risk factors that increase the likelihood a senior will become a victim of financial exploitation. First, individuals living with dementia are at a substantially increased risk compared to their peers who do not have dementia. Dr. Lachs’s findings indicate dementia is the only disease that can lead to a greater risk of abuse.
The second factor which increases the risk of exploitation is living with family. AARP writes of family predators:
Perpetrators are most likely to be adult children or spouses, and they are more likely to be male, to have a history of past or current substance abuse, to have mental or physical health problems, to have a history of trouble with the police, to be socially isolated, to be unemployed or have financial problems, and to be experiencing major stress.
On the other end of the spectrum, seniors who are isolated or are regularly lonely are also at an increased risk of being financially exploited. These individuals tend to be more susceptible to grooming and more willing to engage in conversations with strangers, and don’t have anyone providing a second set of eyes or providing a word of caution about whether or not this new “friend” is trustworthy.
Finally, seniors who have functional limitations or chronic health conditions, or are generally in poor physical health are also at an increased risk for financial exploitation. This is often because these individuals regularly provide enough personal identifiable information (PII) to become the victim of identity theft easily. This can happen when a family member takes their information, or a doctor’s office mishandles the forms with the patient’s PII, allowing that information to fall into the possession of an unscrupulous individual.
There is no single silver bullet that can prevent or stop the financial exploitation of seniors. Dr. Lachs’s findings indicate a single intervention is rarely successful at ending exploitation. Rather, he advises, professionals must work to connect the victim with community resources to stop the violation that is occurring and prevent future reoccurrences.
Professionals who routinely work with seniors should be vigilant in watching for the warning signs of financial exploitation. The first step professionals can take is to recognize when a client is at an increased risk for financial exploitation based on their living condition, cogitative abilities or physical health. Signs a senior may be the victim of financial exploitation can include changes in behavior; mentions of lottery or sweepstakes opportunities; mentions of wire transfers; mentions of jewelry, artwork or other valuable assets going missing; or a new person speaking on behalf of the senior. Finally, professionals who have access to a senior’s finances should be on the lookout for abrupt increases in withdrawals, new spending patterns, atypical ATM withdrawals, gaps in check numbers and large fluctuations in account balances, as these are strong indicators financial exploitation may be occurring.
What to Do When You Suspect Financial Exploitation
Mandatory reporting requirements for suspected financial exploitation vary greatly by state and by profession. Regardless of whether or not you have a mandate to report suspected financial exploitation, expressing your suspicions to a professional is the appropriate action to take. An Adult Protective Services department is typically the first place to contact should you have concerns about financial exploitation of an elderly client. Funded through Title XX, Adult Protective Services (APS) is typically administered by a state’s Department of Health and Human Services or a local Agency on Aging. A state Attorney General office and local law enforcement may also have resources to help identify if someone is the victim of financial exploitation and may be able to intervene to stop the victimization.
Despite increased awareness, better safeguards and better training being offered to “frontline” professionals, financial exploitation of seniors continues to increase year over year. Exploitation can come in many forms, from family members misappropriating a senior’s assets to caregivers or perceived friends stealing money or valuables from the senior. Each case of senior financial exploitation is unique, but the responses from the victims are universal: feelings of guilt, shame, depression and anger are all common. Because of the complex dynamics around financial exploitation, a single, swift intervention is rarely effective at stopping the exploitation or preventing future victimization. Rather, professionals must work together to coordinate resources to ensure the violation of the senior is halted and a reoccurrence does not happen. For those of us working with seniors, it is important that we understand the factors that lead to increased risk of financial exploitation, take time to listen to our clients and contact professionals who are familiar with financial exploitation cases should we suspect it is occurring to one of our clients.