How To Spot Financial Abuse of an Elderly Relative or Friend

Written by |
Advertisement

Using a variety of ruses and common scams, criminals are steadily trying to trick America’s oldest citizens out of their money. Unfortunately, the people taking advantage of the elderly are not always strangers to them, but rather it is often their friends, caregivers or even family members.

This article is going to show you how to spot financial elder abuse and how to prevent and report it.

Elder Financial Abuse: What You Can Do About It

We’ll also share some tips from money expert Clark Howard — whose Consumer Action Center (CAC) takes scam-related calls from people of all ages all the time — and other professional resources.

What Is Elder Abuse?

The Administration for Community Living, a government agency that supports the needs of the aging, says that elder abuse refers to “any knowing, intentional, or negligent act by a caregiver or any other person that causes harm or a serious risk of harm to a vulnerable adult.”

The sad truth is that seniors are vulnerable on many fronts. Elder abuse is often committed by strangers but also by friends or even family members.

To make matters worse, elder abuse is vastly underreported.

Clark says that he’s heard of some outrageous stories involving elders being exploited.

“I’ve heard of one con man who began befriending an older woman when she simply asked him for directions,” he says. “By the time he was done, she had given him Power of Attorney over her funds, and he steadily looted her over time for $180,000!”

How To Spot Elder Abuse

There are some telltale signs that may indicate that an elderly person you know is being taken advantage of. Here are four things to be on the lookout for:

1. Unusual Purchases or Suspicious Activity

If you notice that your usually thrifty grandfather has sprung for a fancy gold watch all of a sudden, alarm bells should go off. Ask yourself: Does he have a new “friend” that he’s told you about? Has someone commandeered his bank account?

Advertisement

2. Financial Activity That Couldn’t Have Been Done by the Person

The Federal Trade Commission says this is one example of what to be on the lookout for: “You discover repeated ATM withdrawals from your bedridden mother’s bank account.”

It’s a good idea to look at your elderly loved ones’ account activity regularly. This way you’ll be in a good position to spot anything that’s amiss.

3. Their Bills Aren’t Being Paid When You Know They Have the Means

The website Caregiverstress.com describes it this way:

“In cases where a family member or friend manages a senior’s finances, be alert to a sudden decline in the client’s lifestyle. This could indicate the caregiver is appropriating the senior’s funds for him — or herself. Watch for things like the arrival of eviction notices for a home where the client has lived for years, utilities being cut off for non-payment, discontinuing trips to the dentist, hairdresser or barber because they are ‘not necessary,’ and other things of this nature.”

4. They Can’t Remember Major Financial Transactions

The AARP says: “This isn’t the garden-variety type of lapse — like ‘I don’t know where I put my keys’ — that nearly all of us experience from time to time. It’s more like when a retiree whose signature is on a bank withdrawal slip for a large amount later says, ‘That doesn’t ring a bell,’ or ‘I don’t recall taking that money out of the bank.'”

How Family and Friends Can Help Prevent Elder Abuse

Spend Time With Older Ones

Clark says some specific ways to help prevent elder abuse are to:

  • Stay involved in their lives. This way, you’ll be able to more easily spot problems. “Be nosy. Find out what they’re involved in and stay vigilant,” he says.
  • Visit them often. “To someone who is a shut-in, just your presence brings them joy. It may seem dull at times, but never forget, someday you will be in those shoes,” he says.

If they don’t live near you, you still need to keep tabs on what’s happening in the lives of your older loved ones, says CAC Director Lori Silverman.

“It is important to stay in contact with elderly relatives and ask questions if you suspect they are being scammed,” Lori adds.

Review Your Older Loved Ones’ Credit

Before you involve yourself in your elderly loved one’s financial business, it’s a good idea to have a heart-to-heart conversation with them. Tell them why you’re concerned and come up with a financial strategy that they agree with. Once the two of you have worked out a viable plan, it’s time to put it into action.

With their help, you should do a comprehensive credit check to make sure their financial life is in good shape.  If you find some issues with your credit report, you may need to dispute them with the appropriate credit bureau.

Get a Free Credit Report

You should be able to access your elderly loved one’s credit report to look for discrepancies, unpaid debts or any other issues that need to be handled.

Advertisement

You can get a free credit report from all three major credit bureaus, Equifax, TransUnion, and Experian.

Read up on how to get a free credit report.

Set Up Free Credit Monitoring

From there, you can sign up for free accounts with Credit Karma or Credit Sesame, for free credit monitoring.

Read our guide on how to monitor your credit.

Set Up a Credit Freeze

If they haven’t done so already, you’ll want them to do a credit freeze with Equifax, TransUnion and Experian. Doing so will protect the senior from anyone opening a new financial account in their name.

Read our Credit Freeze Guide.

Consolidate Their Financial Information

Consumer Reports says to the way to start is to create a simple paper document and list the following information:

  • The names and numbers of your various bank and investment accounts.
  • Insurance information (policy numbers and providers).
  • Regular bills you pay such as utilities and subscriptions.
  • Outstanding debts, such as mortgage and car payments.

Bank of America says, “Once everything is organized, take a closer look at any income your parents might have, such as retirement or savings, and switch those income streams over to direct deposit if possible. This will ensure your parents’ money still makes it into their accounts even if a problem emerges where they are not able (or forget) to make a deposit. If paying bills is stressful for them, you might consider setting up online bill pay so things are paid automatically each month.”

The bank also says it’s a good idea to consider being granted power of attorney, which can be all-encompassing for financial, medical or general decisions or more limited and temporary.

How To Report Elder Abuse

Despite taking all the precautions you can to prevent elder abuse to someone you love, it can still happen. What can you do then? Report it.

Advertisement

If you think your aging relative or someone else you know is being abused, you can contact the National Elder Fraud Hotline at 833-FRAUD-11 (833-372-8311) or reach out to an equivalent state agency where you live.

Final Thoughts

In this day and age, the elderly are potentially vulnerable to a barrage of scams and schemes as criminals devise new ways to exploit them. If we do what we can to stay vigilant, we can help older ones to enjoy their retirement without being scammed.

Want more money-saving advice? Read Clark Howard’s Financial Tips for Seniors.

Advertisement