On behalf of Girard Bengali, APC posted in blog on Tuesday, October 23, 2018.
Elder financial abuse is a serious problem. When organizations target the elderly they are taking advantage of people who are more susceptible to scams.
It’s an issue that affects everyone. Whether you are a target yourself, have elderly family members or may be aging into the group that is often targeted, the financial consequences of a scam can be devastating.
Why the elderly are vulnerable
The SEC released a about elder financial abuse. It discusses the vulnerability of older adults who may have cognitive decline. The mind tends to decline with age, and the changes can be even worse for individuals with health issues. With this decline comes a lesser ability to recognize when they are a target of a financial scam.
In addition, older people tend to have greater wealth, which makes them targets for financial exploitation. It may even be financial advisors or seemingly trusted institutions taking advantage of their clients.
How prevalent is elder financial abuse?
It is hard to pin down the exact statistics for elder financial exploitation. One study showed that for every case that is reported, 44 go unreported. The SEC estimates the prevalence ranges from 2.6 to 6.6 percent, but believes that is likely to be an underestimate.
Even though the exact number is hard to pinpoint, the statistics show that the elderly are a major target. and these are not small cases. If a financial institution is involved the dealings can seem legitimate and leave an individual completely broke.
Examples of elder exploitation
There are many organizations that could attempt to take advantage of a vulnerable elder. One area to be aware of is businesses that focus on elders – for example, banks and other financial institutions that you may otherwise trust. There are also organizations that imitate legitimate organizations such as the IRS, charities or home repair companies that are set up to take advantage of vulnerable seniors.
It’s important to be aware of methods that could be used to exploit elders’ finances. As you age yourself or have aging loved ones, it is important to keep an eye on finances and do business with trusted institutions.