Some of the most disturbing crimes against the elderly involve financial exploitation. While physical abuse is often easy to spot, financial abuse can be more difficult to detect, as victims often have no idea they're being swindled until their money suddenly vanishes. So, what are the 4 warning signs of elderly financial abuse?
Most victims are more than 70 or 80 years old, and involve crimes like fraud, embezzlement, identity theft, along with welfare and insurance scams. If you're caring for an elderly loved one, be on the lookout for the following red flags of financial abuse:
1. Unusual Financial Transactions or Spending
The most obvious sign an elderly family member is being exploited is if there are sudden changes to their spending, banking, and/or financial practices. At the same time, the person may start behaving secretively, confused, or otherwise atypical about money matters. A few of the most frequent actions include:
- Someone who is normally meticulous about their finances suddenly starts seeing unpaid bills, non-sufficient funds warnings, and/or unexplained credit card charges.
- The elderly person starts opening, closing, or changing banking and investment accounts, especially without regard to penalties or fees.
- Someone with consistent spending patterns starts showing a sharp increase in spending and/or investing.
- The person's account sees a suspicious increase in ATM use, withdrawals, and/or checks made out to unfamiliar recipients.
2. The Appearance Of A "New" Person In Their Life
Because they're often alone and isolated, seniors are particularly susceptible to being “befriended” by strangers who take advantage of their loneliness to exploit them. And it may not be a stranger—relatives who haven't been around for years can suddenly start spending lots of time with the person.
This situation is particularly dangerous when the new acquaintance, caregiver, or relative spends time in the person's home, where they have easy access to the person's accounts, financial statements, and personal documents.
One sign that something is amiss is if the senior acts unusual when it comes to the new caregiver or friend. They may seem nervous when that person is around, stop participating in their usual social events, or be reluctant to speak about the person with you. This is a red flag the new person may be trying to isolate or control them.
3. Unneeded Goods, Services, or Subscriptions
Outside of loneliness, the elderly are often physically unable to handle household chores and maintenance like they used to. Given this, they'll likely need service providers to take care of the work for them. But every new person they surround themselves with is a potential swindler.
Watch for unscrupulous door-to-door salesmen and home repair contractors, who stop by offering unsolicited products or services, especially related to home remediation issues. And they don't have to physically present to perpetrate fraud—there are countless telemarketing and email scams that target unsuspecting seniors in order to make a quick buck or steal their identity.
One fairly common scam involves inviting the older person to a free lunch or dinner in exchange for listening to a “seminar” about a financial product or service. The elderly often feel obligated to “buy something” after getting what they thought was a free meal.
Make sure that another adult relative is present before signing any contracts, and always consult with us if you're unfamiliar with a new investment or financial opportunity.
4. Changes to Wills, Trusts, Titles, Power of Attorney, etc.
The worst cases of financial abuse of the elderly can even involve the person making changes to wills, trusts, and other estate planning documents. Other potentially harmful changes can involve deeds, refinanced mortgages, property titles, and/or adding someone to a joint account.
Pay especially close attention if the older person seeks to grant power of attorney to someone out of the ordinary, as this can open the door for massive theft of assets and potentially fatal changes in a senior's caregiving services.
One major advantage to establishing a relationship with a lawyer during your early years is so we can get to know you while you're young, healthy, and clear, and then monitor if anything goes awry in your later years.
One reason financial scams are so hard to detect is that the elderly—like all of us—are embarrassed to admit they've been swindled, or they may not want to get a new “friend” or relative in trouble by telling others about their suspicions.
However, anyone can fall prey to financial fraud, so it's important the elderly know that you've hired us to provide trusted advice and guidance for all financial and legal matters. We can help secure your family's most valuable assets with robust legal protections to prevent fraud and scams of all kinds. Call us today to schedule a Family Wealth Planning Session to make the most empowered and informed decisions for yourself and the family members you love. Or, schedule online.