The Growing Problem of Elder Fraud and Financial Elder Abuse

As our society ages and more individuals head to retirement, elder fraud and financial elder abuse are becoming more common. Those who are forced to manage their own retirement funds while coping with declining health are especially vulnerable. If you or a family member has been the victim of elder fraud or financial elder abuse, it takes a skilled trust and estate litigation attorney to protect your rights.

What is elder fraud?

There are a number of forms of elder financial fraud. Today, a common scam is telemarketing fraud which involves phony telemarketing calls designed to obtain personal information such as Social Security and bank account numbers from vulnerable individuals. Older adults who shop over the phone for convenience are often unaware of the risk. 

In addition, investment schemes can be pitched to older adults, leaving them little time to recover their losses. Also, unscrupulous financial advisors may prey on elders by engaging in account churning, which is the buying and selling of investments in a client account solely to generate commissions. The problem is compounded by the fact that many states do not have reporting rules for when financial professionals suspect fraud on the elderly.

Finally, fraudulent schemes can be undertaken by people who are close to an elder. In particular, caregivers and family members can take advantage of an elderly victim by skimming savings accounts or stealing valuables. 

Why are elders at risk of financial exploitation?

Elders are at a higher risk of financial abuse for numerous reasons. First, many elders have often accumulated significant wealth or have equity in their homes. Moreover, older adults typically receive Social Security retirement benefits, while drawing income from other retirement accounts, such as pensions, IRAs, and 401(k)s. Finally, elderly individuals who are isolated or suffering from physical and mental conditions, such as dementia, are more vulnerable to financial predators. 

The Takeaway

Financial exploitation is the most common form of elder abuse. The misappropriation of funds, property, and assets of seniors results in losses of billions of dollars each year. Although more laws are being enacted to combat various forms of financial elder abuse, it is crucial for family members to become more involved in managing the financial affairs of aging parents and monitoring their transactions. 

Ultimately, the best way to minimize the risk of elder fraud and financial elder abuse is through estate planning. The assets of an elderly individual can be placed into a living trust that is managed by a co-trustee who can protect the assets from scam artists. In the end, by engaging the services of an experienced trust and estate attorney, you can design a plan that will protect your assets and your loved ones.