by Rabihah Butler
Elder abuse is more than physical violence or depriving of necessities, and in some severe cases, it is an attack on the mental and financial well-being of elderly people that can lead to the loss of savings or a broken heart
Elderly Americans, those 60 years old and above, are generally considered to be a vulnerable class — and with age comes concerns about physical health, mental agility, and overall security. While it is important to look out for the physical safety of the potential victim when looking at elder abuse, financial abuse often can be just as harmful.
Traditional elder financial abuse would likely come in the form of a close acquaintance taking advantage of their relationship with the victim to take possession of their property or money. This abuse could include manipulation to get expensive jewelry or convincing a vulnerable person to disclose bank codes allowing the illicit actor to drain the victim’s accounts.
While these are crimes, of course, they are much easier to catch and protect against than other types of financial fraud. In fact, bank employees are now encouraged to look for the signs of this type of manipulation and actively take steps to prevent it. However, less traditional financial abuse is becoming more concerning.
With theft by fraud skyrocketing — losses jumped to more than $10 billion in 2023, from $2.4 billion in 2019 — the rapid rate of is growth should put people (especially those in more vulnerable situations, like the elderly) into a more defensive and skeptical position. Indeed, elderly individuals are disproportionally vulnerable to this more complex and harder to detect type of theft.
In its 2023 report, the FBI’s Internet Crime Complaint Center (IC3) indicated that individuals under the age of 20 were the demographic least impacted by scams and fraud with only 18,000 reported victims, while those 60 years old and older saw more than 101,000 reported victims.
Understanding the root cause of elder fraud
Yet, to more fully understand the problem that some elders are facing you must first look at the root. Desperation and greed are among the reasons scammers have ramped up the use of schemes that will get money quickly from elderly victims. Scammers also look for options that have the lowest risk, so when considering crimes, they see elderly individuals as prime targets for several reasons, including:
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- They assume that elderly individuals are the most likely to have disposable income or savings. While younger individuals are beginning their careers and are just starting to earn money, elderly individuals have had time to amass savings and often have disposable income available for use and investment.
- Elderly people are often less knowledgeable about the complexities of technology, including newer ways of investing. This lack of understanding around recently developed technology platforms making it easier to manipulate the victim. This would include venues like dating apps or digital currency platforms.
- The older the population gets, the more likely they are to be retired, widowed, or lonely. Often, this leads to elderly individuals seeking companionship or friendship; and sometimes, looking for those connections online can open up a whole different world of (unverified and anonymous) people with whom to connect.
- Elderly people also tend to adhere to more conservative beliefs, keeping finances to themselves and not asking for help. So, during manipulation and even after a financial loss, elderly victims are often left in a situation in which they are less likely to speak about it. This makes reporting, prevention, and tracking more difficult.
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This spring, several government agencies — including the Financial Industry Regulatory Authority (FINRA), the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN), and the AARP (formerly the American Association of Retired Persons) — all took notice of the situation and issued warnings or guidance on the increases in elder financial crime, a stark reminder of this widespread problem.
In fact, FinCEN found that between June 2022 and June 2023, it had received 155,415 Elder Financial Exploitation (EFE)-related Bank Secrecy Act (BSA) reports associated with more than $27 billion in reported suspicious activity, which may include both actual and attempted transactions. It is important to note that this is only the number that was reported and does not account for instances in which individuals did not catch on to the fact they were the victim of a scam or instances in which the loss was not reported for other reasons. Further, an AARP report says that more than 40% of Americans (an estimated 141.5 million adults) say they have lost money to scams or had sensitive information obtained and used fraudulently.
While it is easy to count how much money is lost, it’s not as easy to count the number of individuals who suffer from depression or even suicidal attempts as a result of being scammed.
Elders are now facing many complex scams that are aimed at taking advantage of them in more significant ways. In 2023, the Top 5 scams reported to the IC3 were: tech support scams, personal data breaches, romance and confidence scams, product scams (non-payment or non-delivery), and investment scams. IC3 reports that the losses to investment scams alone totaled more than$1 billion in 2023.
And there is another factor that most people don’t even consider in the aftermath of a tremendous financial loss. While it is easy to count how much money is lost, it’s not as easy to count the number of individuals who suffer from depression or even suicidal attempts as a result of being scammed. For example, a 74-year-old retired teacher in Tennessee who was scammed for nearly $100,000 ultimately took his life as a result. In this case, the scammers were caught, but it highlights how these crimes need to be taken seriously.
Eva Velasquez, a former investigator for the San Diego District Attorney’s Office and who now serves as president and CEO of the nonprofit Identity Theft Resource Center, said the organization’s most recent study noted a sharp increase in the number of fraud victims who reported having thoughts of suicide after being conned.
What is clear is that it is important to educate elderly Americans on the use of technology and the reg flags they will inevitably come across, especially online. It is also important to continue to report and track these elderly financial abuse scams in order to try to prevent them in the future.
Full Article & Source:
When financial fraud becomes elder abuse
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