What is Financial Elder Abuse?
Abuse of elderly and impaired adults, including financial abuse, is a tragedy that is increasing at an alarming rate. It comes in many forms, from physical and mental abuse and neglect to financial exploitation. It has been reported that approximately 11% of U.S. citizens age 60 and older suffer from some form of abuse, neglect, or exploitation. In at least one state (Alaska), reports of abuse of its long-term care residents have increased by 200% in the past three years, with the most familiar stories of harm being neglect and financial exploitation.
Older persons in the United States have lost billions of dollars as a result of various forms of financial abuse. The correct amount is unknown as many cases go unreported (estimates are that less than 3% of cases of financial exploitation are ever reported). Elder financial abuse is expected to increase as the baby boomer population ages.
Why Does Financial Elder Abuse Occur?
Strangers account for 51% of the perpetrators of elder financial abuse, while friends, neighbors, and family make up 34% of the perpetrators. Individuals in the business sector commit 12% of elder financial abuse, and 3% involves Medicare and Medicaid fraud. Victims of financial elder abuse have a relationship of trust and confidence, with 90% percent of their abusers. Elder financial abuse may involve theft, forgery, deception, con-artistry (by “confidence men” or “cons”), “romance scams,” coercion, and undue influence to obtain money or property, either directly by outright taking, or indirectly using a Will, Power of Attorney or Deed.
Older citizens, particularly those with Alzheimer’s disease, dementia, and other complex health problems, as well as other adults who are mentally or physically impaired, are often singled out as victims. They present attractive targets due to their dependence on others. Reliance makes it more likely that they will rely upon and trust others who falsely present themselves as friends and helpers who have the elderly person’s best interest at heart. For example, elderly persons who are targeted often live alone and are uncomfortable with technology, which may present opportunities for a “helper” to gain access to bank accounts.
Financial Elder Abuse Is Devastating to its Victims
The resulting emotional and physical trauma, sometimes accompanied by a significant financial loss, can have a devastating effect on victims’ lives. Some victims sink into isolation, being afraid to go out anymore – to the doctor, the grocery store, to visit friends. Even those who have not experienced abuse directly often know or know of others who have, and they may suffer from disabling fear themselves.
Elder abuse is perpetrated by strangers, family members, and caregivers. It cuts across all socio-economic, cultural, racial, and ethnic categories. Abuse and neglect of residents in long-term care facilities often go unreported. Victims often fear that additional abuse will result from reporting the abuse. Some victims are simply unable to understand or report such conduct to the proper authorities, just as they may be unable to protect themselves from behavior that is abusive and sometimes criminal.
How to Report Elder Financial Abuse
In Georgia, certain persons who have reasonable cause to believe that a disabled adult or older person has been abused, neglected, or exploited are required to cause specific reports to be made. Those persons (mandatory reporters) generally include any administrator, manager or employee of a long-term care facility; employees of financial institutions; and any physician, osteopath, intern, resident, other hospital or medical personnel, dentist, psychologist, chiropractor, podiatrist, pharmacist, physical therapist, occupational therapist, licensed professional counselor, nurse, social worker, day-care worker, coroner, medical examiner, or other health professional.
Notably, when such a person is a staff member of a facility, such as a financial institution or hospital, he or she must notify the person in charge of the facility, and the person in charge files (or causes to be filed) the required reports. Georgia law requires any such reporting person to immediately make a report by telephone or in-person to the Georgia Department of Human Services and the appropriate law enforcement agency or prosecutor, followed by a written report within 24 hours containing the information specified in the statute. Usually, the report must be made even if the reasonable cause is based upon privileged communication.
Different States have Different Financial Laws
Georgia’s neighboring states have statutes with similar provisions. Alabama’s reporting requirement is limited to physicians and other practitioners of the healing arts and does not include financial institutions or their employees. Virginia defines reporters to include most persons who are licensed, certified or registered by a health regulatory board, employees or contractors who work with or provide care for adults, guardians, conservators, and law enforcement officers; it does not require reporting by financial institutions or their staff.
West Virginia limits reporters to medical, dental or mental health professionals, Christian Science practitioners and religious healers, social workers, law enforcement and “humane” officers, state or regional ombudsmen, and any employee of any nursing home or residential facility, but does not require financial institutions to report cases of elder abuse. Other southeastern states – Florida, Kentucky, Mississippi, North Carolina, South Carolina, and Tennessee – make “any person” a potential reporting person, including, for example, financial institutions, long-term care facilities, and nursing homes.
Criminal penalties for knowingly and willfully failing to make a required report (or preventing another from doing so) are generally misdemeanors punishable as follows:
Alabama – six months imprisonment or up to $500
Florida – up to 60 days imprisonment or up to $500 or double the monetary loss of the victim
Georgia – up to 12 months imprisonment or up to $1,000 or both
Kentucky – up to 90 days imprisonment
Mississippi – up to 6 months imprisonment or up to $5,000 or both
North Carolina – no criminal penalty found
South Carolina – up to one-year imprisonment or up to $2,500
Tennessee – between 30 days and 11 months and 29 days imprisonment and between $500 and $1,000
Virginia – up to $500 for the first offense and between $100 and $1,000 for subsequent offenses
West Virginia – up to 10 days imprisonment or up to $100 or both.
What’s My State’s Statutory Scheme?
Other states have similar statutory schemes. A few states, such as Florida and California, provide private rights of action for elder abuse. The trend among states, however, is to emphasize mandatory reporting of elder abuse, neglect, and exploitation by persons likely to have significant contact with elder persons, such as administrators, managers, and employees of long-term care facilities, nursing homes, adult day care facilities, doctors’ offices, hospitals, and financial institutions.
The mandatory reporting requirements should benefit elderly persons in several ways. Most obviously, they will lead to investigations and outreach by authorities to assist older persons after they have been victimized. They should also make persons with whom older persons are in contact most frequently more attentive to the problem and, therefore, more likely to look out for and pick up on signs of elder abuse. Equally, important, they should cause mandatory reporters to notice that an elderly person is impaired or vulnerable, and to try to take some appropriate action before an incident of abuse occurs. In this way, the mandatory reporting requirement may operate to counter (at least to some extent) the tidal wave of elder abuse.
On the other hand, the failure of Congress and some states to appropriate sufficient money to fund robust adult protective services activities is a serious problem. As an example, Illinois’ poorly funded and inadequately staffed Vulnerable Adult Abuse Program was revamped in the wake of a media firestorm involving more than 50 vulnerable adults who died after their suspected abuse was reported to the appropriate state agency but never investigated.
How to Prove Elder Financial Abuse
Most states, including Georgia, have not expressly provided for private rights of action in their elder protection statutes. They only provide for mandatory reporting to the Georgia Department of Human Resources, which can make a referral for criminal prosecution. In emergencies, call law enforcement 911.
Examples of Elder Financial Abuse
The Georgia Department of Human Resources defines financial abuse or exploitation as improperly or illegally using a person’s resources for the benefit of another person, for example, using a Power of Attorney to gain access to an adult’s assets for personal gain or using undue influence, false representation and other means to gain access to an adult’s monthly government checks.
Some warning signs of elder abuse include but are not limited to one or more of the following:
- Secretiveness involving financial matters, correspondence, telephone calls, etc.
- Unusual withdrawals or transfers of money from financial accounts
- Significant transfer of other assets, such as real property
- Unique gifts to caregivers or others
- Rare loans
- Other unexplained losses or changes in the economic situation
- Accumulation of unpaid bills
- New friends or even romantic interests
- Changes to a Will
- Change of beneficiary