More than 334,000 instances of elder financial exploitation are reported to the authorities across the U.S. each year. This leads to around $6.3 billion of losses as per a study of state and federal information by Comparitech, a cybersecurity research firm. Yet, despite the financial toll from the pandemic, elder care subsidies continue to increase.
These numbers are likely to understate an issue that experts say goes largely unreported.
However, experts say that elder fraud can be nipped in the bud quite quickly. Follow these steps to safeguard yourself or a loved one in need from financial abuse.
1. Choose someone you trust to be the financial authority.
“We don’t want to talk about money. It’s private. We need to alter the way we think about it,” says Julie Schoen as director-in-charge of the National Center on Elder Abuse (NCEA) at the University of Southern Cal’s Keck School of Medicine.
Do not use the typical power-of-attorney forms, but tailor a power of attorney according to your requirements and, in the best-case scenario, with the assistance of an attorney. (The Federal Government’s Eldercare Locator can help you locate low-cost or free legal aid.)
Perhaps you would like your legal representatives to take care of all financial issues, or perhaps you want to allow them to, for example, file taxes or oversee the property. Whatever your choices are — write them down.
2. Designate a trusted contact to manage investment accounts and accounts.
An authorized contact refers to a person you allow a bank or financial institution to communicate with regarding suspicious activities on your account, or in the event that they are not able to contact you. The business can divulge specific information about your account to a trusted contact. However, they are not allowed to make transactions.
Another option is to grant an individual you trust with access to your accounts. View-only account holders can view your transactions but cannot conduct business or access your account’s funds. This is a more secure alternative to opening an account jointly. Both parties can withdraw money, and the account is automatically transferred to them in the event of your death.
“Never add anyone to your bank account or to the title of your home,” advises Joanne Savage, An attorney from the Legal Counsel of AARP for the Elderly, which offers free legal aid to seniors who live in Washington, D.C.
Contact your broker or bank or visit their website to learn more about including a trusted contract or access-only account. The Financial Industry Regulatory Authority (FINRA), a non-governmental organization that regulates brokerage firms and their members, requires its members to request clients to provide a reliable account holder when they open or upgrade accounts.
3. Join a service that monitors your investments, bank accounts, and credit cards.
Technology tools like EverSafe as well as LifeLock can spot suspicious activities — such as withdrawals from accounts that are not in order or sudden changes to spending habits — and alert you and an advocate you trust.
They do more than protect you from fraud, scams, and identity theft. They also provide assistance to recover any losses. For example, if you are a victim of fraud, they can guide users through what steps you need to follow in reporting the fraud and minimizing the loss. In addition, if you are involved in identity fraud, EverSafe is willing to reimburse legal costs.
4. Keep in touch with your older loved ones.
Aging results in the loss of contact due to life changes like retirement or the death of others. Social isolation, whether caused through life’s events or physical distance caused by the COVID-19 epidemic, is among the most significant risk causes of elder financial abuse, according to the NCEA.
Keep in touch with your loved ones via regular visits via video and phone texts, emails, and calls. Please encourage them to remain active in religious communities and volunteer activities, or any other social gatherings.
Be on the lookout for anyone who insists on your trust. They may be someone who is in contact with family or friends. Or appears to put an undue influence on decisions regarding finances, or solicits large amounts of money.
Scammers becoming friends with older adults in order to cheat them out of money is a common phenomenon. They groom the victim’s children. Their only purpose is to mulct funds from their naive elderly friends. Says Kristin Burki, Director of the National Clearinghouse on Abuse in Later Life (NCALL), “They’re seeking out weaknesses in older people. Be aware of the relationships that are present in the life of an older person.”
5. Learn about the caregivers for your loved one.
If you are looking to hire home help for your loved one, use an accredited agency. They will go through extensive screening and take action in the event theft occurs.
After being hired, make sure the caregiver continues to perform well. For example, how do they take care of them? Do they cook and clean regularly? Are they qualified to administer medications?
“They’re much less inclined to profit from Mother since they know you’re paying them,” says Bonnie Brandl, co-founder and former director of NCALL. So if you’re concerned about a current caregiver, start looking for another one immediately.