Senior financial abuse scams are a multi-billion dollar industry. This type of abuse not only effects seniors, but their families, financial institutions, taxpayers and all the services that provide relief to the victims. MetLife Mature Market Institute did a study in 2011 that estimated that the annual financial loss from senior financial abuse was 2.9 billion dollars! That number was based solely on the cases that made it to the media.
Seniors are especially susceptible to fraud. This is because we tend to be more trusting as we age, we have more wealth accumulated by that time in our lives, and our worlds become smaller. Generally, seniors do not have contact with a wide variety of people and become secluded from the outside world. While this is a natural process that comes with age, it also provides opportunity for those who mean to cause us harm. All seniors are at risk for being targeted, but women account for the majority of these types of crimes. I am not convinced this will always be the trend but for now it is. That is due to the fact that women live longer than men, leaving them alone when their spouse passes; and elderly women in 2017 are from a generation where they are used to relying upon others in their lives to help them make important decisions.
Financial abuse comes in a variety of forms, but there are certain forms that present themselves over and over again and have become very commonplace. Some of the top senior financial abuse issues include: Identity Theft and Credit Card Fraud, Power of Attorney Abuse, Reverse Mortgage Scams, Living Trust and Annuities Scams, Deed Theft and Foreclosure Rescue Scam, Undue Influence and Healthcare Scams.
The perpetrators are not so easy to spot. They come dressed as your family member, a friend or neighbor, and someone working in a professional atmosphere with ready-made deals, and ideas on how to invest money. When anyone approaches an elderly person regarding: reviewing an estate plan, reverse mortgages, annuities, or any other product that would effect the individual’s financial portfolio – beware! If something needs to be changed, either a trusted advisor who you have been working with for years will bring it to your attention during the course of a regular review or you will be the one reaching out to the professional - not the other way around. As a rule of thumb, if someone calls you, walk away. That includes your family members. If the family is urging you to do something, get at least three professional opinions before making any decisions. Unfortunately we cannot simply trust blindly anymore; but rather, ought to be cautious - especially as we age.
The only real way to help prevent this type of abuse is to have a revocable living trust created, one that is very thorough regarding your wishes. That is what is so beautiful about creating your plan; you have control throughout every stage of your life. It is critical that this process is done properly; otherwise you won’t be doing yourself any favors in the future. Elizabeth Westby, J.D. contributed to this press release.