E stands for Eliminating Elder Fraud
Personal Finance from A to Z
Eileen St. Pierre, The Everyday Financial Planner
According to the Pew Research Center, 10,000 Baby Boomers will turn age 65 each day until the year 2030, when the entire generation will reach that age. This “graying” of America influences all aspects of our lives. But it also represents a large segment of the population that is vulnerable to fraud. It can be very difficult to educate older adults on recognizing fraud.
The National Center on Elder Abuse reports that older adults lose an estimated $2.6 billion annually due to elder financial abuse and exploitation. These funds could have been used for housing, food, and medical care. It is estimated that for every case of elder abuse or neglect reported, as many as 23 cases go unreported.
- Female elders are abused at a higher rate than males.
- The older one is, the more likely one is to be abused.
Common Types of Elder Fraud
- Abuse of Power of Attorney
There may come a time when a loved one needs to step in and take control of an older adult’s finances. But you need to be very careful before granting a power of attorney to anyone. It can be a license to steal and it is very difficult to police the holder of a power of attorney.
- Fraudulent Wire Transfers and Withdrawals
Seniors may be duped into wiring money overseas in order to receive a prize. Of course, they never get the prize and the scammer keeps their money.
- House Repair Scams
After Mother Nature pays one of her calls, scammers hit the neighborhood looking for elderly homeowners to pay them money for home repairs they don’t need. Many never complete the repairs. Some are so persistent that seniors may pay them just to leave them alone. Scammers can also tell when an older adult is exhibiting dementia; they may keep coming back to the house and do the same repair over and over.
- Identity Theft
We’ve all been told not to give out personal information over the phone, but many lonely seniors may let their guard down.
- Investment Fraud
With interest rates so low now, it can be easy for a scammer to convince cash-strapped seniors to invest in securities that either don’t exist or are way too risky for them. Remember Bernie Madoff?
- Theft from Family
Grandma’s social security check may be going towards her granddaughter’s drug habit or her son’s gambling addiction.
Warning Signs of Elder Fraud
- Frequent expensive gifts to a caregiver
- Caregiver refuses to spend money on elder adult
- Personal belongings, papers, and credit cards are missing
- Numerous unpaid bills
- Signing over deeds to property
- Signing for a loan they don’t need
- Unusual activity in bank account; frequent checks made out to cash
- Signatures on checks or legal documents look forged
- Irregularities on tax return
- Elder adult unaware of reason for appointments with banker or attorney
- Elder adult unaware of monthly income
If you suspect elder fraud or any kind of elder abuse, contact your state’s Department of Human Services. To report a fraud or scam, call your state Attorney General’s office or Better Business Bureau.
World Elder Abuse Awareness Day is June 15. Outreach guides, fact sheets, and other resources are available.
Visit my Financial Planning for Later in Life page for more information.