Elder financial abuse has reached epidemic numbers. A new report issued by True Link finds that approximately 36.9% of seniors are affected by financial abuse in any five year period and seniors in the United States are losing $36.48 billion each year to elder financial abuse. (True Link 2015) This number represents an increase of over twelve times what was previously reported. Financial exploitation (misleading or confusing language combined with undue influence is used to obtain a senior’s consent to take his/her money) results in seniors losing $16.99 billion annually; criminal fraud (e.g., overseas lottery scams, grandparent scams, identity theft) causes a $12.76 billion loss to seniors; and caregiver abuse (deceit or theft by a trusted family member or individual) is responsible for a $6.67 billion loss. (True Link 2015) SeniorLAW Center has compiled some tips for protecting seniors from financial exploitation.
Steps for protecting oneself (CFPB and FDIC 2013) from investment fraud:
• Never judge a person’s trustworthiness by the sound of their voice.
• Say “no” to anybody who tries to pressure you or rush you into an investment.
• Be wary of salespeople who prey upon your fears or promise returns that sound too good to be true.
• Always ask for a written explanation of any investment opportunity and then shop around and get a second opinion.
• Be wary of any financial adviser who tells you to leave everything in his or her care.
• Document all conversations with financial advisers.
• Take immediate action if you detect a problem. Time is critical, so do not be afraid to complain.
Steps for protecting oneself (CFPB and FDIC 2013) from telephone scams:
• Never “pay to play.” A legitimate sweepstakes will not ask for money upfront.
• You cannot win a sweepstakes or lottery that you did not enter.
• Be suspicious of any pressure to send funds via wire transfer or a pre-paid reloadable card.
• Scammers often claim an emergency, hoping you will take quick action without checking out the situation. Before offering help to a grandchild (or another relative or friend), be sure to telephone your grandchild or the parents at a number you know to be valid to find out if the request is legitimate.
• If a caller claims to be from an established organization such as a hospital or law enforcement agency, look up the number of the organization independently before taking action.
• Consider it a red flag if the caller insists on secrecy.
Steps for protecting oneself (CFPB and FDIC 2013) from identity theft:
• Protect your SSN, credit card and debit card numbers, PINs, passwords, and other personal information.
• Protect your incoming and outgoing mail.
• Sign up for direct deposit.
• Before tossing out these items, destroy them, preferably using a crosscut shredder that turns paper into confetti that cannot be easily reconstructed.
• Keep a close watch on your bank account statements and credit card bills.
• Never provide bank account or other personal information in response to an unsolicited email, or when visiting a website that does not explain how personal information will be protected.
• Review your credit report annually and report fraudulent activity.
If you believe you have been the victim of elder financial abuse, contact SeniorLAW Center at 215-988-1242.
Consumer Financial Protection Bureau and Federal Deposit Insurance Corporation, Money Smart for Older Adults: Prevent Financial Exploitation, (June 2013), available HERE .
True Link, The True Link Report on Elder Financial Abuse, (2015), available HERE. /research.