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Identify and Prevent Financial Elder Abuse

Jake Stimpson

It is a story too often repeated.

A woman used to being independent and self-sufficient insists on living by herself, even as she ages. Over time, the family notices that some of the people working for her are “borrowing” money from her. Or they hear (after the fact) of a sales person who has come to her house to sell her some financial product she neither understands or needs.

Her children become concerned because Momma does not always know what day it is. But what can they do?

First, you can call it what it is – financial elder abuse.

Jackson, Mississippi based elder law attorney Richard A Courtney writes,

Financial elder abuse is a different kind of problem. The opportunity for abuse arises when an elder loses the ability to effectively manage his or her own finances. The decline may be gradual; that is, often there is no clear line of demarcation between the point when one can pay his or her own bills and handle money, and the point at which it is clear that the senior is no longer able to manage finances. People in positions of trust, such as adult children, grandchildren, and even unrelated caregivers can take advantage of the declining mental capacity of a vulnerable elder and prey upon this incapacity.

So, when an elderly person loses their capacity to handle their own personal affairs and make clear decisions, they become vulnerable not only to greedy strangers, but (even worse) to greedy people whom they thought they could trust.

Well, if you hear of this, or even see it, what can you do?

1. You can identify it. Call it what it is – elder abuse. It’s not “borrowing money,” it is theft. And the financial guy may be guilty of predatory sales practices.

2. You can avoid it. The best time to avoid financial elder abuse is before it happens. There may come a time when you have to step into your aging parent’s financial life to protect them from those who would take advantage of their situation. This is never an easy step, nor is it one to take lightly. You may need to contact an elder law attorney to discuss your options and what legal steps you may need to take for her protection.

3. You can stop it. If you think someone working for an elder person you know is taking her money, it’s time for that worker to go. If you think your aging parent bought a financial product she neither understood nor needed, you can go to the financial firm’s senior management with your concerns. You may be able to get her money back. At the very least, you can tell them to never sell your mom anything again without your approval.

4. You can report it. If you suspect someone of breaking the law (can you say “theft?”), you should report it to authorities. Louisiana’s Elderly Protective Services program investigates suspected abuse. You can reach EPS by calling 1-800-898-4910.

There ought to be a place deep under the jail for someone who steals from or abuses the elderly.

Absent that, it’s up to those who care about elderly loved ones to watch for and prevent financial elder abuse.

Byron is a Certified Financial Planner and Managing Director of the Planning Group at Argent Advisors, Inc.
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