Ask Vanessa: Elder Financial Abuse is On The Rise

DEAR VANESSA,

My mother prefers to live alone. However, she has been showing signs of forgetfulness. She is open and friendly, and seems to enjoy sending donations to different organizations. I hear stories about elder financial abuse, and I worry about her. What is your advice? Thank you. 

- JAVIER

DEAR JAVIER,

Seniors are attractive targets due to the following reasons: they are more likely to have saved up a significant amount of money, they are more likely to own their homes, and they are more likely to have a good credit record. Seniors are also less likely to report fraud, often because they are ashamed, don’t now how to report the incident, or don’t even realize they’ve been scammed. One recent study reported by Consumers Digest estimated that there are at least 5 million cases of this financial abuse in the United States each year, but law enforcement or government officials learn about only 1 in 25 cases. This crime can have a significant impact on its victims because they are incapable of recovering financial losses; the emotional impact of elder fraud can be traumatic as well.

Watch out for signals that may indicate that your mother is a likely target of financial abuse. These include unusual or large withdrawals or transfers from bank accounts, or large credit card charges that she can’t explain. Does she have unpaid bills? No single sign is conclusive proof, but staying aware will help you avoid or limit the fallout if there are any problems. If possible, monitor her bank account for suspicious activity. Be vigilant. Has someone suddenly formed a close relationship with her and gained her trust?

Hiring the services of a fiduciary is something that you may consider A fiduciary is someone who has undertaken to act for and on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence. A professional fiduciary can provide critical services and manage matters for your mother including daily care, housing and medical needs, and also offer financial management services ranging from basic bill paying to estate and investment management. Start out on the right foot if you want things to work out the way you and your mother intend them to. Meeting with a competent fiduciary is the first step.

Another way to prevent financial fraud is to talk about money with your mother early and often. It may go against the grain, but discuss your own finances with her if it will help her open up about hers. Make an effort to visit as often as you can and watch her mail for letters from promotion companies or shady looking “charities.” Encourage her to ignore all solicitations; this is the best single defense against financial abuse. Surround her with supportive people, family members and friends.

- VANESSA