How to protect yourself from financial abuse?

So-called “elder abuse” is an increasing phenomenon estimated to be at least 9 billion USD in the US annually. 98% of cases go unreported and only one in 44 are referred to adult protective services or the authorities. Especially wealthy individuals may fall prey to predators who betray their trust.

Financial elder abuse is defined as “the illegal unauthorised or improper use of an older individual’s resources by a caregiver or other person in a trusting relationship for the benefit of someone other than the older individual.” (National Centre for Injury Prevention and Control). Examples include forgery, misuse or theft of money or possessions. Use of coercion, or deception to surrender finances or property; improper use of guardianship or power of attorney.

Protecting yourself from this kind of abuse requires a combination of awareness, education, and proactive measures. Here are some steps individuals can take:

1. Establish open communication: Maintain open and regular communication with older adults in your life, such as family members or friends. Build a trusting relationship where they feel comfortable discussing their financial matters with you.
2. Educate older adults: Help older adults become aware of common financial scams and frauds that target seniors. Provide them with resources and information on how to protect themselves from financial exploitation. Encourage them to be skeptical of unsolicited offers, requests for personal information, or high-pressure sales tactics.
3. Monitor financial accounts: Encourage older adults to regularly review their financial statements, bank accounts, and credit reports. If they are not comfortable or capable of doing it themselves, offer assistance in monitoring their financial activities for any signs of unauthorized transactions or suspicious behavior.
4. Set up power of attorney: Encourage older adults to establish a power of attorney and designate a trusted person to make financial decisions on their behalf if they become unable to do so. Ensure that the designated person is reputable and has the older adult's best interests at heart.
5. Limit financial exposure: Help older adults minimize their risk by advising them to limit sharing personal and financial information, especially on the internet or over the phone. Discourage them from providing sensitive information to unfamiliar individuals or organizations.
6. Be involved in financial matters: Offer to help older adults with their financial management, such as bill payments, budgeting, and tax preparation. Regularly review their financial documents and statements to ensure everything is in order and to identify any potential irregularities.
7. Seek professional advice: Encourage older adults to consult with a trusted financial advisor, attorney, or accountant who specializes in elder law or senior financial issues. These professionals can provide guidance on financial planning, estate management, and protecting assets.
8. Report suspected abuse: If you suspect financial elder abuse, promptly report it to the appropriate authorities, such as adult protective services or law enforcement. Provide them with any evidence or information you have to support your concerns.

Remember, prevention starts with being proactive and involved in the financial well-being of older adults. By staying informed, maintaining open communication, and taking necessary precautions, you can help protect them from financial exploitation.