Last week, in “Protect Your Loved One From Financial Abuse, Part 1,” we detailed some shocking statistics about financial elder abuse, listed some risk factors, and explained the most common types of exploitation scams committed against seniors. Though the scams we highlighted were broad in range and overwhelming at first glance, don’t lose hope. There are concrete ways that seniors can protect themselves from fraud! First, it’s essential that you help your loved one understand the most common schemes so that they can recognize suspicious activities. If you haven’t read Part 1, go back and read it now.
Next, once you finish reading Part 2, schedule some time to sit down with your loved one and share what you’ve learned. You can even print out the list of scams and potential preventative actions and post them on your loved one’s fridge, bulletin board, or by their telephone for easy access. Encourage your loved one to ask any questions. Offer your loved one any assistance that they need in understanding or implementing the following strategies. You can be your loved one’s greatest asset and advocate in protecting them from financial fraud. Read through the following tips once on your own, and once you’re ready, read them aloud to your loved one.
#1: Telemarketing fraud
- Ask to be removed from telemarketing call lists.
- Get advice from family and friends before making any purchases/investments.
- Ask the caller for written material before making a purchase.
- Never send money to improve your chances of winning a prize.
- Never give a caller your credit card number/any form of personal identification.
- Research offers with your consumer protection agency or state Attorney General’s office.
- Always tell solicitors: “I never buy from (or give to) anyone who calls or visits me unannounced. Send me something in writing.”
- Report any rude or abusive callers to 1-877-FTC-HELP or ftc.gov/complaint.
- Don’t click on internet ads.
- Only respond to email solicitations that you have initiated.
- Never send money to banks overseas.
- Delete unsolicited emails with attachments.
- Be suspicious of anyone who contacts you online claiming to be a victim of some disaster.
- Search for charity organizations at Charity Navigator, and only trust charities with sites that end in .org.
- Don’t trust any online “friends” who you don’t know and trust in person.
- Use strong passwords, change them frequently, opt for two-factor authentication, and don’t use the same password for everything. (As a caregiver, you can help your loved one keep track of their passwords by writing them down and putting them in a safe, secure place).
- Talk with your caregiver/trusted friends before sending any money.
- Only use the internet over secure Wi-Fi sources rather than free public Wi-Fi.
- Install anti-virus programs and keep your operating system up to date.
#2: Sweepstakes/lottery scams
- Never fall for a cold-call that claims you’ve won free money or prizes.
- Never send money before a check is confirmed by your bank.
#3: Investment Schemes
- Never pay up-front money for investments that advertise enormous returns in short periods of time.
- Explore the Investor Protection Trust, which provides resources to empower investors to make wise decisions and avoid fraud.
#4: Identity theft
- Dispose of papers with personal information by tearing up/shredding receipts, statements, expired credit cards, or offers for new credit cards.
- Never give out your Social Security number unless it’s a familiar and trusted organization. Don’t have your Social Security number printed on checks.
- Don’t give any personal account numbers over the phone unless you’ve placed the call and you know and trust the recipient.
- Visit IdentityTheft.gov, the U.S. government’s resource to help you report and recover lost assets from identity theft.
- Read the Identity Theft publications provided by the Federal Trade Commission.
#5: Predatory lending/reverse mortgage schemes
- Be suspicious of anyone pressuring you to file a reverse mortgage and of any loans that seem too good to be true.
- Have a lawyer look over the contract for any loan to ensure that the terms are reasonable.
#6: Home Improvement Scams
- Get bids from other established businesses and distrust any offers that are “too good to be true.”
- Be suspicious of anyone going door to door or cold calling with offers for home improvement.
- Get the contractor’s license number and ensure their credibility with the Contractors State License Board, Better Business Bureau, or Chamber of Commerce.
- Ask for referrals and check them out to ensure their legitimacy.
- Never rush into home improvement offers, accept work from unlicensed contractors, allow work to be completed without a written contract, or pay a down payment for the work that exceeds $1,000 or 10% of the contract price.
#7: Estate planning
- Order your affairs so that personal and financial matters will be taken care of upon your death including your will, trust, power of attorney, advance health care directives, and joint tenancies.
- Carefully choose trustworthy people to act as agents, successors, trustees, or conservators.
- If a person designated in your estate is not acting in your best interests, you can amend/terminate a Power of Attorney or trust.
- Medicare will never send emails out of the blue requesting sensitive information. Never send your personal information in response to an email requesting verification. Always call your health provider directly if you have any questions.
- Keep your Medicare card secure and only share your numbers with your health care team.
- Check your statements carefully and log into MyMedicare.gov to spot fraud.
- Report suspicious activity by calling 1-800-MEDICARE or report online.
- Order a Medicare ID fraud prevention and awareness placemat.
#9: Counterfeit prescription drugs
- Never buy discount drugs or drugs on the Internet.
- Always receive prescriptions from a doctor and order/pick up prescriptions from a trusted pharmacy.
#10: Funeral and cemetery scams
- Be wary of strangers claiming to have known the deceased, especially if they claim the deceased has debts to be repaid.
- Only go to reputable funeral homes and research online to understand the usual costs and the necessary expenditures.
#11: Fraudulent anti-aging products
- Never trust products that claim things that are too good to be true, or market themselves as “fountains of youth.”
- Only use products from reputable companies or products recommended by a physician. Buy products at the pharmacy rather than purchasing from online vendors.
#12: Grandparent scam
- Never send a grandchild money if they request it over the phone, particularly if they ask you to use Western Union or MoneyGram, services that don’t require identification at pickup.
- Ask questions on the phone that only your grandchild would know the answers to.
As a caregiver, you should always keep an eye out for these signs that your loved one may be a victim of financial exploitation:
- Significant withdrawals from accounts
- Belongings or money missing from their home
- Unpaid bills despite adequate income
- Unnecessary goods or services
- Disappearance of papers, checkbooks, or legal documents
- Elderly assistance with credit card purchases/ATM withdrawals
- Lack of amenities in a long-term care facility
- Impulsive or evasive explanations about their personal finances
- A family member or friend’s excessive interest in the money possessed by and being spent on your loved one
- Unusual activity in your loved one’s bank accounts, like withdrawals when your loved one is known to be home
- The appearance of a stranger who forms a close relationship with your loved one and offers to help with their finances and estate
- A sudden change in your loved one’s personality, especially if they appears confused, bedraggled, or afraid
- A family member or friend who denies others access to your loved one
- Piles of sweepstakes mailings, magazine subscriptions, and “free gift” offers that indicate your loved one is being targeted
Elders face enormous problems recuperating from financial exploitation. They have less time to regain lost assets, they are past the age of employment, and they often rely solely on their savings to meet their expenses and needs. Doing everything that you can to protect your loved one from financial abuse will save them from the frequently devastating experiences that result from exploitation, including:
- Loss of trust in others
- Loss of financial security
- Loss of independence
- Loss of confidence in financial abilities
- Depression, hopelessness, or even suicide
- Isolation from family and friends
- Feelings of fear, shame, guilt, anger, self-doubt, remorse, and/or worthlessness
- Inability to regain/replace lost assets
- Inability to hire an attorney to pursue legal action
- Being forced to rely on social welfare agencies that provide a significantly lower quality of life
- Inability to provide for their own long term care needs, forcing them to become reliant on others or to subsist without their needs being met
- Loss of primary residence
- Suffering of family members whose inheritance was reduced, depleted, or destroyed by their loved one’s exploitation
If your loved one seems vulnerable or has fallen victim to fraud, you can help them in the following ways:
- As soon as possible, help your loved one develop a financial plan for the coming decades
- Immediately help your loved one call their bank and/or credit card company.
- Help your loved one cancel any debit or credit cards linked to the stolen account.
- Help your loved one reset their personal identification numbers.
- Discuss personal finances with your loved one. In a Wells Fargo Survey, 34% of adult children reported difficulty in conversing about their parents’ money, but discussion is the first step in preventing abuse.
- Ask to check your loved one’s bank accounts and credit card statements for unauthorized transactions.
- Help settle your loved one’s financial affairs or enlist a professional to help get them in order.
- Help your loved one sign up for direct deposits so others can’t cash their checks.
- Close any of your loved one’s joint bank accounts and transfer their money to a personal account.
- Introduce yourself to a representative at your loved one’s bank and fill out a “trusted contact” form so the bank will notify you if there’s reasonable belief of financial exploitation.
Additional resources that can offer your loved one assistance in preventing/prosecuting fraud are:
- Works to reduce isolation of the victim by referring them to services and cases to law enforcement for investigation and prosecution.
- Find your local Senior Medicare Patrol here.
- The Department of Justice’s support system provides resources to assist victims of elder abuse.
- Provides latest information regarding research, training, best practices, news, and resources on elder abuse.
- Find your state’s reporting numbers, government agencies, state laws, state-specific data and statistics, and other resources here.
- This service identifies erratic financial activity and notifies a trusted advocate
Addressing financial exploitation with your loved one
Financial exploitation can still occur even if you have your loved one’s best wishes in mind due to your own finances and stresses. If you think that you have financially exploited your loved one or that you are in danger of doing so:
- Be honest with yourself and those who want to help you
- Open up to others about your financial concerns and try to come up with a plan to increase your financial stability.
- Find respite care for your loved one while you deal with your finances.
- Enlist a trusted friend, family member, or professional to help you break the pattern of abuse.
- Contact a counselor, psychologist, or therapist who specializes in helping change harmful behaviors.
Taking legal action
Legal actions can be taken following financial abuse:
- Civil remedies: Lawsuits to recover stolen assets or property.
- Criminal justice action: Prosecution of offenders or abusers who committed the crime.
- Annulments of sham marriages arranged purely to acquire the victim’s wealth.
- Court-appointed guardianship to remove the victim from the abuser,
- Actions taken by the police and sheriff’s departments, which usually have dedicated Elder Abuse Units.
- Monitoring by a neutral third party such as a member of the American Association of Daily Money Managers to secure bank accounts and credit reports.
- Investigation by your county’s District Attorney and City Attorney Office, most of which have units that investigate and prosecute elder abuse.
In pursuing retribution from financial abuse, you and your elder need to consider your state’s statute of limitation. Some states give as little as one year to take legal action, while others give victims as long as six years. Knowing your state’s laws will ensure that your legal action can be taken within the allotted time frame.
Addressing current elder abuse
All in all, although progress is slow, more attention is being given to the issue of elderly financial exploitation. Under the Trump administration, prosecution of elder abuse has shifted to the Department of Justice as a “law and order” issue. In February of this year, the Justice Department coordinated the Elder Fraud Sweep, the largest in history, and charged more than 250 defendants with schemes that cost nearly 1 million people, mostly the elderly, more than $500 million. Most recently, President Trump enacted the bipartisan Senior Safe Act, which exempts financial institutions and their employers from liability in the case of reports of potential elderly exploitation to a government agency. In addition, the Senate Special Committee on Aging has updated their publication: “Fighting Fraud: Senate Aging Committee Identifies Top 10 Scams Targeting Our Nation’s Seniors” in addition to providing a hotline (1-855-303-9470) and an online form to report fraud. In the past year, they’ve also held a number of hearings on elderly financial exploitation.
We’ve still got a long way to go, but caregivers can play an essential role in minimizing financial abuse by educating their loved ones. The more you learn, the more you can protect your loved one and yourself as you get older. In a couple of weeks, I’ll be talking about choosing the best long-term care facility for your loved one and making sure that their money is being put to good use. Check back or sign up for Ayuda’s newsletter so that you never miss a thing!