The financial abuse of elders is a growing problem in America. According to the American Bankers Association, the victims of senior financial abuse lose nearly $3 billion a year. Increased awareness of the issue hasn’t stopped people from trying to steal private information from seniors. Online and phone scammers are continually thinking of new ways to trick unwary into giving away their money. Like nursing home abuse and neglect, preventing financial abuse takes vigilance from the family members. Knowing the basics of how to protect older family members from financial abuse will aid you, even as new scams tactics arise.
There is a common misconception that financial abuse requires a scam phone call or a dodgy internet site. These tactics are used by many scammers but don’t overlook the amount of damage that can be done by not properly disposing of sensitive information. To protect your family member’s private data, shred receipts, bank statements, credit card offers, and other financial offers that in the mail before throwing them away. You should also keep important documents (e.g., social security cards, checkbooks, etc.) stored in a secure and organized place. This way, it’s easy to notice if something has gone missing.
For family members that have assets in financial institutions, be sure that you are listed as the trusted contact for the account. A Finra rule that went into effect in 2018 requires brokers to ask for a trusted contact for all new accounts (regardless of the age of the person getting the account). This contact will be consulted if the institution notices an unusual transfer of funds or other suspicious activity. The person opening the account isn’t required to give a trusted contact, but doing this can help prevent cases of financial abuse. If the account already exists, you can ask your family member to add you as the trusted contact next time they update their account information. Other pieces of recently enacted legislation may help prevent financial exploitation in the future.
Since you can’t be with your elderly family members all the time, it’s essential to teach them basic financial safety tips. This knowledge can help prevent them from becoming a scammer’s next victim. A common scam is for someone to call or send an email stating they need private information to verify something. Make sure your family member know to never give out personal information, such as their Social Security Number, account number or other financial information, to anyone over the phone or email unless they were the ones who initiated the conversation and they trust the other party.
Many scams don’t look like a scam at first glance. This trick is why so many people fall victim to financial abuse, even when they are on guard for suspicious offers. Protecting your elder family members from financial abuse requires you to be knowledgeable about the most common scams at the time. Right now, the trend is to get seniors to sign up for fraudulent monthly services. These monthly fees can come from things that sound legitimate, like computer technical support services or nonprofit organizations. Inform your family members about these tactics, so they know what to guard against, and check their monthly statements to look for any suspicious account activity.
Seniors do have critical financial decisions to make, such as estate planning, and this is another area where financial abuse can happen. Scammers may try to pressure seniors into contracts for services that are overpriced or provide little value. Remind your family members never to make hasty financial decisions. Always ask for offers in writing and take time to review the details. You should also have a trusted financial advisor or a legal professional review any contracts before they are signed.
Preventing the financial exploitation of seniors can be tricky, but it’s easier if you know what to look for and you have a professional to back you up. If you have questions about protecting your family members or you need to investigate a situation that could be financial abuse, contact the Law Firm of Steve Watrel, P.A. to schedule a free consultation.