Elder Financial Abuse: Types and Warning Signs
8 April 2015
Financial abuse of the elderly is one of the most tragic, devastating forms of fraud there is, and it is too often glossed over or ignored. Scammers and predators take advantage of elderly people who may have mental or physical disabilities that keep them from being able to understand and track their own finances. Often, the children and families of these victims don’t become aware of the amount of money and credit they have lost until after their death, preventing them from taking the necessary steps to recover the money and punish the perpetrators.
Seniors can get caught up in a variety of financial scams, including but not limited to:
- Sweepstakes scams, where the elderly person receives a phone call claiming that they have won a sweepstakes but must wire money or submit financial information before they can claim their prize. One victim’s son described his experience on consumer advocate Bob Sullivan’s blog, saying that his 80-year-old mother had been convinced by sweepstakes scammers to send them the contents of her entire savings account, then take out small loans to pay off the rest. She ended up wiring more than $25,000 to the scammers.
- “Sweetheart scams”, where fraudsters use the internet or telephone-based dating lines to convince seniors they’re in love with them, then ask for money to come for a visit or pay for supposed emergencies.
- Caretaker scams, where private financial information is given to a home aide or medical assistant in order to help them cover the senior’s expenses, then used for identity theft or credit card fraud later.
- Grandparent phone scams, where scammers make calls to elderly people pretending to be police or emergency services, saying their grandchild needs them to send money immediately. Occasionally they will even ask for credit card information over the phone.
According to the U.S. National Committee for the Prevention of Elder Abuse (NCPEA), elder financial abuse is far from random. Perpetrators single out particularly vulnerable elderly people, moving from place to place to avoid being caught and, especially in the case of caretaker scams, specifically target recently widowed or highly disabled seniors to latch onto. Seniors who are lonely, have few contacts, suffer from physical and mental disabilities, and have disengaged or drug-addicted family members are particularly vulnerable to this type of abuse.
If you have an elderly family member, there are a few warning signs you should be on the lookout for to prevent them from becoming the target of financial abusers. They include:
- The elderly person has a new best friend or romantic partner who doesn’t live nearby and asks them for money.
- Bills aren’t paid on time, despite the fact that the person’s finances had previously been stable.
- Bank statements and other documents stop coming to the person’s home, a sign that someone else has taken over the account and changed the address.
- Account statements show suspicious activity, such as large withdrawals or moving money between accounts. This is especially important to keep track of if the elderly person is bedridden or intellectually disabled and therefore incapable of making these changes on their own.
- The person has signed away their power of attorney to someone else, especially someone who isn’t a family member.
- There are sudden changes to the person’s will that haven’t been discussed with family.
- In the case of a caretaker scam, the person’s level of care may seem far below what they could normally afford. This could be a sign that the caretaker is spending money on him or herself rather than purchasing supplies.
- The person has recently opened credit card accounts or taken out loans when they have no personal reason to do so.
If you have elderly relatives who live alone or with a caretaker, be vigilant and check in with them often to make sure you don’t see any of these signs. In some cases, investing in a credit monitoring subscription for your elderly relatives can be crucial in helping you ensure that financial abuse is not taking place by tracking suspicious activities on their accounts.