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(On Jan. 23, from 1-2 p.m. EST, Mark Maddox of Maddox Hargett & Caruso P.C. will be a featured guest on NPR/WFYI’s No Limits with host John Krull. Maddox will discuss elder care and offer insight from both a legal perspective and as a former Indiana Securities Commissioner on popular investment scams targeting seniors, common red flags to watch for, and the kinds of financial products that may be inappropriate for older investors.)
Research shows that financial exploitation of the elderly costs older adults nearly $3 billion a year. In many instances, the perpetrators behind this exploitation turn out to be the elder person’s caregiver or family member. In other cases, the elderly are scammed through outright investment fraud and scams.
To help older adults and their caregivers protect themselves, the Consumer Financial Protection Bureau recently published four guides under the title “Managing Someone Else’s Money.” As reported in a recent story by the Wall Street Journal, the CFPB’s guides provide clear and detailed information for people in four specific fiduciary roles: people named agents under a power of attorney to make decisions about a family member’s money and property; those appointed by a court as guardian or conservator to manage money or property for someone who can no longer do it on his own; trustees in charge of living trusts; and those appointed by a government agency to manage Social Security or veterans’ benefits.
According to the WSJ article, more than 22 million people 60 years of age and older have legally named loved ones as “agents” through powers of attorney; about 4 million adults with Social Security income have something called “representative payees,” 85% of whom are family members.
When it comes to elder financial exploitation, there are a number of common warning signs that may indicate a potential scam. According to the National Center on Elder Abuse, some of these signs might include:
*You notice financial activity that is inconsistent with your financial history and/or beyond your means (i.e. increased or unexplained credit card activity, withdrawals in spite of penalties, newly authorized signers on accounts).
*Your caregiver or beneficiary refuses to use your funds for necessary care and treatment.
*You are confused about recent financial arrangements/transactions and are reluctant to discuss finances.
*There have been recent changes to your property titles, deeds, refinanced mortgages, Power of Attorney documents, wills, trusts or other documents that you do not understand and did not authorize.
If you suspect you are a victim of financial exploitation or elder investment fraud, there are certain steps you can and should take and resources available to help identify and remedy the problem. Reporting the issue is never easy, especially if the suspect is a friend or family member. At the same time, elder financial exploitation is a crime, and it’s important to alert the proper authorities as soon as possible.
The Eldercare Locator is a nationwide, public service that connects older adults and caregivers with local aging resources that can offer assistance. You can call the Eldercare Locator at 800.677.1116 or visit their Web site at www.eldercare.gov.
Finally, take steps now to protect yourself or older family members from becoming a victim of financial frauds and investment scams by learning more about financial exploitation and ways to avoid it. For more information, go to www.stopfraud.gov/protect.html.