The sunset of life can be a particularly challenging time. America’s seniors are vulnerable and exposed to the possibilities of physical, emotional, and financial exploitation. Studies have found that more than 333,000 cases of financial abuse are reported every year.
On average, nearly $11.5 billion is lost annually due to elder fraud. The figures may be even higher because many cases go unreported. The full extent of senior financial abuse is challenging to determine since organized reporting is not practiced in some states.
As per the latest government census, there were over 55 million senior adults aged 65 and above in 2023. Many rely on caregivers for support and sustenance, whereas others live by themselves. In any case, the elderly need protection against exploitation.
In this article, we will discuss three ways in which seniors as well as their friends and family can prevent financial abuse.
Designate a Trusted Person as the Financial Power of Attorney
The senior must choose a person of integrity for financial decisions before incapacitating. Even two people can be appointed for the same so the workload can be shared. Also, one can hold the other accountable when the need arises.
An ideal power of attorney would be someone who can be trusted completely. They must be financially organized and familiar with handling online transactions. Seniors are free to ditch the standard power of attorney form and customize the role per their needs.
Besides the technical aspects, a reliable power of attorney will ensure the senior can dictate their care and manage finances (even if personally unable to do so). Family members also feel empowered instead of overwhelmed.
So, when would be the right time to designate this role? A senior should decide upon their financial power of attorney in case of a dementia/Alzheimer’s diagnosis, upcoming surgery, or an inability to cope with financial responsibilities.
Appoint a Reliable Contact for Investments and Accounts
Seniors and their family members should be on the lookout for any suspicious activity in the bank accounts. This could include unexplained ATM withdrawals, a switch from a basic account, or a sudden message about insufficient funds.
A reliable point of contact would be someone who would get in touch with the bank in case of any questionable activity. Some account details may be revealed to the contact, but they would not be allowed to make any transactions.
It would essentially be view-only access, where the contact can monitor transactions without accessing the funds. This option can prevent financial exploitation and is safer than opening a joint account.
Moreover, seniors must only choose reliable banks so that their accounts and investments stay safe. For instance - trusted banks partner with anti-money laundering or AML software vendors to keep their customers’ accounts safe.
According to AU10TIX, the AML software enables banks to detect, investigate, and report any activity that seems questionable. All transactions can be monitored in real-time through special algorithms to identify suspicious parties.
Family Members Should Keep in Touch with Caregivers
Did you know that close to 26 million Americans aged 50 and above live alone? In modern society, this is one of the many natural consequences of aging. Many elderly have lost connections due to the death of their spouse, retirement, social isolation, etc.
Family members must make every effort to keep in touch, especially if they live in different states. It is best to have the senior move in. In case they do not oblige, contact can be maintained through regular visits, phone calls, and texts. Seniors should be encouraged to become a part of their community through social gatherings, faith groups, and volunteering opportunities.
The elderly’s family should also keep an eye out for anyone who may subtly groom their loved ones into giving large sums of money. This is a phenomenon where an individual may try to befriend the elderly in hopes of extracting money from them in the future.
This means family members must get to know their senior’s caregivers thoroughly. Observe how well they take care. It’s vital to ask questions regarding medicine administration, stocking up healthy food, etc.
In all areas, the caregiver must be blameless. Financial exploitation is less likely when they’re aware that the family is looking out for the senior.
If a senior feels like they’re being financially exploited, there is no time to waste. The matter must be immediately brought to the attention of a trusted family member or the local police. The bank must also be notified to block any transactions from taking place. Even Adult Protective Services can be contacted to keep the elderly safe.
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