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Elder Financial Abuse and Identity Theft / Scams

Elder Financial Abuse and Identity Theft / Scams

Posted on October 15, 2018

Originally published in October 2018

This article has not been updated for current law since the date of its posting on the website. This article is not intended to provide any legal advice. Please seek advice of your professional council.

Any U.S. federal and state tax advice contained in this communication is not intended or written by the Knox Law Firm to be used, and cannot be used by you, for the purpose of: (i) avoiding penalties under the Internal Revenue Code that may be imposed upon you, or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein.

Types of Elder Financial Abuse

Caretakers – stealing or inappropriate (or unauthorized) use of assets, etc. by family members or third-parties
Financial Investments & Reverse Mortgages
Insurance – Annuities. Long Term Care, etc.
Identity Theft & Scams: credit card, bank fraud, and telephone and/or internet scams and “phishing”

Types Of and Concerns With Elder Identity Theft and Scams

Identity Theft

ID Theft is a crime of exploitation where one assumes another person’s identity, typically in order to:

Access resources or obtain credit and other benefits in the victim’s name/identity;
Fraudulently obtain goods or services in the victim’s name/identity; or
Conceal his or her true identity from legal authorities, background checks, etc.

Three common perpetrators with the elderly include scammers, caregivers and relatives.

Identity Theft can result in:

Denial of credit and/or harm to credit rating
Tax problems
Harassment by debt collectors and/or legal action
Loss or denial of employment or public benefits, or garnishment of wages
Denial of medical care
Emotional/Mental Toll on the Victim, including shame or sadness, helplessness, anger/rage/betrayal, and isolation.

Typical Scams that Target the Elderly

Financial seminars aimed at selling insurance products
Announcements of a “prize” or sweepstakes that the elderly person has won but mist pay money to claim
Phony charities
Investment fraud

Examples of Elder Financial Abuse by Various Caretakers

By Family Members:

Borrowing with no intent to repay
Denying cate or services to conserve funds
Selling or gifting elder’s possessions
Signing or cashing Social Security checks
Misusing ATM or credit cards
Compelling elder to sign over property
Misuse of Power of Attorney for personal gain/benefit

By Strangers/Third-Parties:

Health remedies and “special” medical treatments
Insurance packages – health, funeral, life
Investments
Home repairs or services
Charitable contributions
Prizes and sweepstakes
Loans and mortgages (especially reverse mortgages)

Protections and Prevention of Elder Financial Abuse

Watch for Warning Signs

Living conditions well below their resources
Unusual or inappropriate bank activity
Checks written to “cash”
Bills unpaid or overdue
Transfers of title to property or assets
Reluctance to discuss finances
Personal belongings missing
Isolation

Prevention Tips to Consider

Reduce Elderly Person’s Isolation from Others
Limit/restrict powers of attorney or agency
Request/conduct periodic accountings
Direct deposit of income/payments (but watch for joint accounts)
Auto-pay bills wherever possible
Utilize geriatric care managers and/or similar professionals
Keep financial records neat and up-to-date

Author: Mark A. Denlinger

Originally published in October 2018