MetLife’s Mature Market Institute estimates that seniors lost $2.9 billion due to financial abuse in 2010, an increase of $200 million from 2009. Seniors are often victims of investment fraud, credit card fraud and identity theft because they are vulnerable to sales of products that will save them money, improve their income or savings, or prevent them from becoming a burden on their children. Seniors are attractive targets because many of them have a “nest egg” in the form of home equity and some savings. Willie Sutton once said when asked why he robbed banks, “That’s where the money is.”
Think about this. Your parents are more likely than their working neighbors to be at home during the day to answer the phone or a knock on the door. They expect people to be honest; they don’t hang up the phone while people are talking even when they aren’t interested; and they don’t close the door when people are still standing there talking to them even when they don’t want to let them in. The telephone allows telemarketers 24/7 access to your parents for a laundry list of scams, from false prizes, lotteries and charities, to faking to be an injured family member calling for money.
Every day your parents see news articles, advertisements, official looking notices all designed to get them to fill out a response card with personal information. A web of organizations receives these information requests and then sells this personal information to others. Those who buy it then promptly attempt to sell your parents something, or steal their identity. Your parents might be pressured to buy a financial product, unnecessary medical equipment and supplies, a trust, a pre-paid funeral, an investment scheme, or a reverse mortgage.
And today scammers have new tools like social media and the internet to gather information about your elderly parents that will make them much more credible when they call or visit. Google Earth allows anyone with an internet connection and an address to become intimately familiar with a neighborhood. Social media allows that unscrupulous person to gather intimate details about an individual, their family, and their activities. They can easily gain entry into your parent’s home to commit financial abuse after convincing your parent they are closely connected to their friends, relatives or neighbors.
Fraud against elders is vastly underreported, in part because older people are less likely to know their rights or even where to lodge a complaint. But more importantly they don’t want anyone to know when they’ve been the victim of any kind of abuse, particularly financial abuse. It’s a huge embarrassment, and they think it’s the first step towards incompetence and losing their independence. Adult children or other family members need to know the warning signs of when abuse might be happening. Watch for these signs:
- Cutting back on purchases
- Unpaid bills or utility shut off notices
- Switching banks or financial advisors
- Changes in legal documents (wills, trusts, deeds, mortgages)
- A “new best friend” whose advice is always needed
- Missing personal property
If you see signs of abuse, investigate and report it promptly. Also, remember to guard your Medicare card, and remind others with Medicare to guard their card. Often getting one’s Medicare number is the first step for a scammer to commit identity theft. To report Medicare fraud and/or ID theft from your Medicare number, call your California Senior Medicare Patrol at 855-613-7080.
Below are some organizations to contact for more information on financial elder abuse, and/or to report such abuse.
California organizations where you can report various kinds of financial elder abuse:
(List edited from California Advocates for Nursing Home Reform article)
- Consumer Scams: Contact your county office of the District Attorney. Check the California District Attorney’s Association website for current addresses and phone numbers or call 916-443-2017
- Insurance Agent Complaints: Contact the State Insurance Commissioner’s Office online or by phone at 1-800-927-4347. If an attorney sold a fraudulent annuity, also file a complaint with the State Bar Association online or by phone at 1-800-843-9053
- Attorney Complaints: File a complaint with the State Bar of California if you believe your attorney acted improperly, and file complaints with state and local consumer protection agencies
- Mortgage Lenders & Brokers Complaints: If you believe that a real estate professional has committed fraud having to do with your reverse mortgage, file a complaint with the California Department of Real Estate. Also file a complaint with the Federal Trade Commission online or by phone, toll–free, at 1–877–FTC–HELP
- Local law enforcement and county District Attorney’s office: Check California District Attorney’s Association for current addresses and phone numbers online or by phone at 916-443-2017
- Adult Protective Services (APS): Contact your county’s APS by referring to California Department of Social Services website
- Attorney General’s Bureau of Medi-Cal Fraud and Elder Abuse (BMFEA): Report suspected Medi-Cal fraud or elder abuse to BMFEA online or by calling 1-800-722-0432
Government and national sites
- Consumer Financial Protection Bureau’s Office for Older Americans
- Do Not Call: Register to Stop Solicitation Calls
- Federal Crimes Enforcement Division (FinCEn)
- National Institute of Justice provides research findings on elder financial abuse
- Securities and Exchange Commission (SEC) investigates securities fraud
- Postal Inspection Service investigates fraud using the US Mail
- National Center on Elder Abuse
- National Adult Protective Services Association (NAPSA)
- Federal Trade Commission protects consumers from unfair and fraudulent business practices, ID theft, phone scams and more:
The FTC also compiles fraud reports at their Consumer Sentinel Network for national metropolitan statistical areas; scam prevalence by region; reports of fraud complaints from persons age 50 and older.