Financial crime, sometimes referred to as Financial Abuse or Financial Exploitation, is a growing epidemic in the United States. The Internet has given us access to new worlds, and financial criminals have taken up stealthy positions in those worlds, preying on unsuspecting Internet users, and especially Elders. While some elders are very ‘tech savvy,’ others are unfamiliar with the digital environment and sometimes leave themselves open to victimization. In addition, the computer is not the only tool being used by modern financial criminals. Telephone scams such as the IRS Scam and the Grandparents scam snare thousands of people.
Financial Crime may take many forms such as financial abuse by family members and acquaintances and financial abuse using powers of attorney, trusts, etc. The following is a list of types of financial exploitation commonly reported to Adult Protective Services Agencies nationwide:
• Theft: involves assets taken without knowledge, consent or authorization; may include taking of cash, valuables, medications other personal property.
• Fraud: involves acts of dishonesty by persons entrusted to manage assets, but instead appropriate assets for unintended uses; may include falsification of records, forgeries, unauthorized check-writing, and Ponzi-type financial schemes.
• Real Estate: involves unauthorized sales, transfers or changes to property title(s); may include unauthorized or invalid changes to estate documents.
• Contractor: includes building contractors or handymen who receive payment(s) for building repairs, but fail to initiate or complete project; may include invalid liens by contractors.
• Lottery scams: involves payments (or transfer of funds) to collect unclaimed property or “prizes” from lotteries or sweepstakes.
• Electronic: includes “phishing” e-mail messages to trick persons into unwittingly surrendering bank passwords; may include faxes, wire transfers, telephonic communications.
• Mortgage: includes financial products which are unaffordable or out-of-compliance with regulatory requirements; may include loans issued against property by unauthorized parties.
• Investment: includes investments made without knowledge or consent; may include high-fee funds (front or back-loaded) or excessive trading activity to generate commissions for financial advisors.
• Insurance: involves sales of inappropriate products, such as a thirty-year annuity for a very elderly person; may include unauthorized trading of life insurance policies.
(Source: National Adult Protective Services Association - http://www.napsa-now.org/get-informed/what-is-financial-exploitation/)
In spite of all efforts, Financial Crime continues to grow, and the elderly and other vulnerable populations are very often its target and are disproportionately affected by the financial losses that result from these crimes. This toolkit page is intended to provide information and resources to help combat this problem, and promising practices to help victims.
Financial Crime may take many forms such as financial abuse by family members and acquaintances and financial abuse using powers of attorney, trusts, etc. The following is a list of types of financial exploitation commonly reported to Adult Protective Services Agencies nationwide:
• Theft: involves assets taken without knowledge, consent or authorization; may include taking of cash, valuables, medications other personal property.
• Fraud: involves acts of dishonesty by persons entrusted to manage assets, but instead appropriate assets for unintended uses; may include falsification of records, forgeries, unauthorized check-writing, and Ponzi-type financial schemes.
• Real Estate: involves unauthorized sales, transfers or changes to property title(s); may include unauthorized or invalid changes to estate documents.
• Contractor: includes building contractors or handymen who receive payment(s) for building repairs, but fail to initiate or complete project; may include invalid liens by contractors.
• Lottery scams: involves payments (or transfer of funds) to collect unclaimed property or “prizes” from lotteries or sweepstakes.
• Electronic: includes “phishing” e-mail messages to trick persons into unwittingly surrendering bank passwords; may include faxes, wire transfers, telephonic communications.
• Mortgage: includes financial products which are unaffordable or out-of-compliance with regulatory requirements; may include loans issued against property by unauthorized parties.
• Investment: includes investments made without knowledge or consent; may include high-fee funds (front or back-loaded) or excessive trading activity to generate commissions for financial advisors.
• Insurance: involves sales of inappropriate products, such as a thirty-year annuity for a very elderly person; may include unauthorized trading of life insurance policies.
(Source: National Adult Protective Services Association - http://www.napsa-now.org/get-informed/what-is-financial-exploitation/)
In spite of all efforts, Financial Crime continues to grow, and the elderly and other vulnerable populations are very often its target and are disproportionately affected by the financial losses that result from these crimes. This toolkit page is intended to provide information and resources to help combat this problem, and promising practices to help victims.
Reports
- “ELDER JUSTICE: National Strategy Needed to Effectively Combat Elder Financial Exploitation” (Publication No. GAO-13-110). To write this report the GAO interviewed state and local social service, criminal justice, and consumer protection officials in four states with large elderly populations. The GAO found the need for more safeguards and public awareness activities. U.S. Government Accountability Office. (2012, November).
- “Federal Government Has Taken Some Steps but Could Do More to Combat Elder Financial Exploitation” (GAO-13-626T). This report indicated that “Older adults are being financially exploited by strangers” Financial exploitation includes mail, telephone, or Internet scams; unscrupulous financial services professionals; and untrustworthy in-home caregivers. The General Accounting Office (GAO) visited local law enforcement authorities in the four states and found that these states were investigating and prosecuting the a growing number of cases involving interstate and international mass marketing fraud.” The GAO has identified “several ways the federal government is, or could be, supporting state and local efforts to combat elder financial exploitation.” U.S. Government Accountability Office. (2013, May).
- Senior Safe Act This bill intended to provide immunity from prosecution for financial institution employees and financial institutions for having disclosed the suspected exploitation of a senior citizen, was signed into law on May 24th 2018.
- New BBB Study on Lottery/Sweepstakes Fraud Two-thirds of lottery and sweepstakes fraud victims are over age 60, and three-fourths of the money lost in scams that goes to Jamaica is from people over 70. Those are among the sobering findings of a newly released report by the Better Business Bureau. The report is authored by Steve Baker, editor of the Baker Report, who also authored CEJC's blog post Awash in a Sea of Fraud: No Guns, No Action and will be featured during the upcoming webinar International Financial Crime: How Do We Turn the Tide and Help Older Victims?. The report found that nearly 500,000 people reported this fraud to enforcement agencies in the U.S. and Canada over the last three years. Reported losses in 2017 alone totaled $117 million.
Resources
- Model Civil Provisions on Elder Financial Exploitation was produced by the National Center for Victims of Crime, in collaboration with the American Bar Association and with support from the Huguette Clark Family Fund for Protection of Elders. “Elder financial exploitation is insidious and pervasive and has serious implications for its victims’ financial, emotional, and physical well-being. Although exact statistics are unknown, it is widely agreed upon by experts in the field that elder financial exploitation is underreported to investigatory agencies such as Adult Protective Services or law enforcement. Thus, it is also unlikely that victims pursue any civil remedies. This report discusses barriers to the civil justice system, and proposes some recommendations for overcoming some of those barriers.”
- White Paper: Roundtable on Serving Victims of Elder Financial Exploitation was produced by the National Center for Victims of Crime with support from the Huguette Clark Family Fund for the Protection of Elders. During the Roundtable in November 2014, “Over thirty nationally-recognized experts in the field, including representatives of various government and law enforcement agencies, physicians, lawyers/judges, professors, financial services professionals, regulators, executive directors of national and local victim-oriented organizations, and policy analysts gathered in Washington, D.C. to address the gaps and to proffer concrete steps to help those affected by elder financial exploitation. The document generated “focused on 3 areas: 1) Direct Victim Services, 2) Public Policy, and 3) Justice System”; and generated five recommendations to help combat Elder Financial Exploitation.
- National Guidelines to Implement the 2013 Federal Interagency Guidance on Privacy Laws and Reporting Financial Abuse of Older Adults was developed by the Philadelphia Corporation for Aging and the National Adult Protective Services Association with support from the Huguette Clark Family Fund for the Protection of Elders. This document provides APS workers with the information, documentation, and sample tools they need for requesting information from financial institutions in abuse investigations.
- The Baker Report is a comprehensive weekly update on current national and international scams and the efforts underway to stop them. The Baker Report is edited by Steve Baker, the former Director of the Federal Trade Commission’s Midwest Region.
- The Consumer Financial Protection Bureau: What is WEAAD? Find out why June 15 is important for older people in your community. The Consumer Financial Protection Bureau is a U.S. government agency that makes sure banks, lenders, and other financial companies treat you fairly. In this blog commemorating World Elder Abuse Awareness Day; discusses Elder Financial Exploitation, why older Americans are attractive targets, and outlines some of the efforts underway to combat financial abuse through the CFP.
Promising Practices
- Sussex Victim Support Program. This innovative new program in Sussex England assigns Victim Support case workers in the Sussex Police to work with vulnerable victims who have been systematically targeted by criminals. Workers help victims with tasks like contacting creditors to take control of her finances and also to seek help through Citizens’ Advice.
- The San Francisco Veterans Benefits Protection Project. The VBPR is a coalition of organizations that fight pension poaching scams targeting older veterans. The VBPR is led by the Institute on Aging's Senior Abuse Prevention Program with funding by the San Francisco Department of Aging and Adult Services. Among the group's accomplishments is a tool that was developed for service providers who work with older veterans to use to detect scams in their early stages and identify trends, including geographic areas where veterans are being targeted and scammers who have committed multiple offenses. It further provides guidance in reporting scams to the Department of Insurance, Attorney General's office, and district attorney's offices his form of elder financial abuse threatens the health, safety, and financial freedom of thousands of elder veterans across the country.
- National Asian Pacific Center on Aging-Asian American and Pacific Islanders (AAPI) Financial Exploitation Series. Asian American and Pacific Islanders (AAPI) represent more than 50 subpopulations, and people that speak over 100 different languages. By the year 2030, the AAPI older adult population is projected to increase by 145%. Included within this series are two fact sheets: (1) Identifying Financial Exploitation and (2) Planning to Protect Yourself from Financial Exploitation. These fact sheets are available in English, Chinese, Vietnamese, Korean, Tagalog, and Samoan. The Guidelines for Professionals are intended to (1) provide instructions on utilizing the in-language fact sheets developed within this series, and (2) highlight best practices for professionals when working with AAPI older adults who may be a victim of, or vulnerable to, financial exploitation.
Links to More Information
On the CEJC Website:
Undue Influence Toolkit Page
“Under the Radar” Developments We’re Watching
Victims of Crime Act
Bills and New Laws
August 1st Webinar Recording & Materials: International Financial Crimes: How do We Turn the Tide and Help Older Victims?
National Innovations
Elder Justice Blog: Unpacking Undue Influence
Elder Justice Blog: Awash in a Sea of Fraud: No Guns, No Action
On other websites:
AARP Money/Fraud Watch Network
Federal Trade Commission-Consumer Information-Scam Alerts
Consumer Financial Protections Bureau Report: Recommendations and Report for Financial Institutions on Preventing and Responding to Elder Financial Exploitation
Undue Influence Toolkit Page
“Under the Radar” Developments We’re Watching
Victims of Crime Act
Bills and New Laws
August 1st Webinar Recording & Materials: International Financial Crimes: How do We Turn the Tide and Help Older Victims?
National Innovations
Elder Justice Blog: Unpacking Undue Influence
Elder Justice Blog: Awash in a Sea of Fraud: No Guns, No Action
On other websites:
AARP Money/Fraud Watch Network
Federal Trade Commission-Consumer Information-Scam Alerts
Consumer Financial Protections Bureau Report: Recommendations and Report for Financial Institutions on Preventing and Responding to Elder Financial Exploitation