Elderly parents and loved ones are at elevated risk of falling victim to financial abuse as the pandemic goes on, especially those in major metropolitan areas.
COVID-19 is exacerbating the problem because elders have been cut off from friends and family, community centers, and other interactions where people look out for them. Perpetrators of financial elder abuse can capitalize on this dropoff in oversight, or checks and balances. These predators, who most often are family members, caregivers, neighbors, or friends, take advantage of their position of trust and confidence for their own benefit.
You can expect the problem to be even worse in major metropolitan areas, like Los Angeles, where my probate law firm is based and where we have a massive population that skews wealthier than the national average (translation: more victims to target).
What to Do Now
We always tell people when dealing with their elderly parents, “Stay vigilant and stay involved.” The best way to remedy financial abuse is prevention. You don’t want to be caught in a situation where your mother’s neighbor offers “help” with groceries by taking her debit card to the grocery store but then “forgets” to return the debit card, leaving Mom’s account vulnerable to theft. The more you’re present, the sooner you’ll learn about these things, get involved, and prevent harm.
Be involved or, at the very least, be informed about your loved one’s finances. Know where their bank accounts are and who their financial advisors are.
Staying involved means you will not only be able to respond quickly if something happens, but, more importantly, make your presence known, which can act as a sufficient deterrent to prevent abuse from happening in the first place. Think of it like this: While having a house alarm can’t stop someone from breaking in, it will make your house a less attractive target than a house without an alarm.
You don’t need to watch your elderly loved one like a hawk, but in our experience it’s the people whom predators know nobody’s really watching or paying attention to who are most likely to be victimized. In a very short amount of time, someone can come in, take over their finances, and divert their assets or trust to someone else.
Make your presence known to the predators. Communicate with your parents (or grandparents), and anyone helping them, often. Speak with their caregivers or care facility frequently. Technology allows new ways to keep tabs on family members. FaceTime, Zoom, and other video chat platforms actually let you peek into their lives, which allows you to make sure there are no signs of physical abuse. In our experience, if your loved one shows signs of physical abuse, 99 times out of 100 there likely is financial abuse as well.
Identifying and Responding to Elder Abuse
Some signs you should look for are changes in behavior, such as sudden reliance on a new “friend,” lack of responsiveness or confidence, getting off the phone quickly, and illogical concerns that don’t comport with their history or situation.
If you think someone is being abused, find the adult protective service organizations in your county, or go to the local police department and ask for their elder abuse division. If you hit dead ends, there are elder abuse specialists we work with whom you can consult. Of course you can always consult with an elder abuse attorney to guide you.
It Happens All the Time
The National Center on Elder Abuse estimates that at least 10% of the elderly population experiences elder abuse. Research shows financial mistreatment to be the most commonly reported form of elder abuse.
The Consumer Financial Protection Bureau estimates losses to elder Americans from financial exploitation range from $2.9 billion to $36.5 billion per year, and that was pre-pandemic.
The economic strain of quarantine leads people to take advantage of others. It’s a perfect storm, with economic pressure on one side and economic opportunity on the other. Right now, these storm clouds are colliding.
Here in California, because we had some of the earliest and strictest quarantine measures in the country, we are likely to be one of the hardest-hit places, both in terms of gross numbers and assets. That swell is not limited to California, unfortunately…