March 15, 2017 by Mark Hammerstrom
Let me be clear that this is not a blog about the Ten Commandments. Yet, I think it is hard to argue that at the very least they can form a solid basis for good moral framework of our lives.
Increasingly, it seems, many of us have forgotten the commandment to “Honor thy Father and thy Mother” and subject them to abuse–if not physically, emotionally or mentally, then financially—stealing literally billions of dollars each year through financial scams and outright theft. What is the worst is that much of this outright theft is at the hands of the people they need to trust the most—their families!
Writing a commentary for CNBC (“Protecting yourself and loved ones from elder financial abuse”), Richard Behrendt, director of estate planning at Annex Wealth Management, writes that “Elder financial abuse is fast becoming the crime of the 21st century.”
He cites some stunning statistics about the number of older Americans who have become victims. Quoting a recent study by Metlife, 3.2 million Americans were the victim of elder financial abuse in 2014, representing a nearly $2.9-billion-dollar loss each year.
Elder financial abuse, as Behrendt defines it, is: “…unauthorized, illegal or inappropriate use of an aging adult’s financial resources by a person in a position of trust.” The abuse is broad based and crosses all boundaries—social, racial and economic.
Much of the increase in this type of crime is due to the increasing numbers of aging “baby boomers” and is “…largely a crime of opportunity.” Judgement declines as we age and we become especially vulnerable if there are not adequate checks and balances to help us manage our finances. Behrendt points out that the most venerable tend to be single adults who don’t have a spouse to keep things in perspective.
Yes, there are scams galore from outside sources including fake prizes or sweepstakes, the old “Nigerian Prince” scam, home improvement scams, claims of a grandchild in distress, and even romance scams from online dating services or chatrooms.
The most common and alarming abusers, however, are the victim’s own family. I think this is the most disquieting aspect of this crime because such innocent trust is placed in those we love so much. Perhaps that is why this commandment was included so prominently!
Having been responsible for an elderly relative’s financial situation I can attest to how difficult this can be. There is a fine balance between being respectful and supportive while counterbalancing often incomprehensible requests due to varying emotional states compounded by memory loss and other challenges.
Behrendt suggest the following warning signs that may indicate some type of abuse is occurring (quoting):
- Sudden or unexplained changes in spending habits.
- Surrendering control of finances to a new friend or partner.
- Suddenly changing a will, trust or beneficiary designations.
- Unexplained checks made out to cash, or unexplained loans.
- Unexplained disappearance of assets (cash, valuables, securities, etc.).
- Signs of anxiety or fear when asked about finances.
He suggests some other protective actions we can take including (quoting here):
- Stay connected and involved with older family and friends.
- Encourage seniors to use automatic bill payment services.
- Shred financial statements instead of discarding in trash.
- Contact the National Do-Not-Call Registry at http://www.donotcall.gov.
- Never send money to someone you don’t know.
- Do not give personal information over the phone.
- Create a valid durable power of attorney.
- Organize and store important legal and financial records.
- Itemize and safeguard valuables and collectibles.
- Request and review a free credit report annually.
- Check references of caregivers and service providers.
- Be wary of all unsolicited offers of any kind.
- When in doubt, get a second opinion of a trusted friend or advisor.
- Assemble a trusted team that includes a financial advisor, an attorney, an accountant, etc.
Our work family at UCS is a pretty close knit bunch. Family is a word often used when we relate to each other. Unfortunately, we see the financial damage crimes like this can do to unsuspecting people. As we age we are well reminded to “Honor thy Father and thy Mother” as we will likely be in its vulnerable spot ourselves someday.
Founded in 1950, United Credit Service, Inc. is a full service, licensed revenue cycle management and debt collection agency in Wisconsin providing effective, customized one on one management and recovery solutions for our business partners. Visit our website at http://www.unitedcreditservice.com, call 877-723-2902, or check out our YouTube video.