by Mary Twomey, MSW, Aging Services Program Specialist, Office of Elder Justice and Adult Protective Services, Administration for Community Living, U.S. Department of Health & Human Services
Today in a stuffy room somewhere in the U.S., dozens of fast-talking men and women armed with telephones, friendly voices, and empty promises have set their sights on older Americans. Their goal is to line their pockets with funds from those seniors, and chances are they will be successful.
Financial exploitation costs older Americans billions of dollars every year. Some fraudsters use the phone (58 percent of investment fraud victims reported receiving at least one investment sales telephone call each month), some use U.S. mail or e-mail, and some bold scammers will even prey on their targets in person. Their ways of stealing money are limited only by their creativity. Exploiters can be total strangers, trusted professionals, or family members. Often, victims of financial exploitation never tell anyone they have been fleeced because they are embarrassed, fear reprisal, or are not aware that they have suffered a loss. In fact, a 2011 study in New York State showed that for every case of elder financial abuse reported to authorities, as many as 43 cases were never reported.
One sub-set of financial exploitation is investment fraud. Investment fraud involves the illegal sale or purported sale of financial instruments. According to the FBI, the typical investment fraud scheme is characterized by offers of low- or no-risk investments, guaranteed returns, complicated strategies, or unregistered securities. Older victims of investment fraud are from all socio-economic levels. People with cognitive impairment, and those with a high tolerance for financial risk taking, are more susceptible to the siren’s song of these scammers.
Societal trends also play a role in older Americans turning to high risk investments: the decrease in the number of pensions has left many baby boomers without sufficient income; age discrimination in employment often has made it difficult for older people to find jobs; and persistent stigma about dementia causes many to hide their memory concerns until a big financial loss reveals their secret. In addition, seniors who do not have access to social service programs that decrease isolation can be eager for any outside contact, even if that contact is from a stranger.
What can America do to stop elder financial abuse? To answer this question, we may want to look at how America responded to the issue of child abuse. Over the past years, our country has reduced child abuse using a multi-faceted approach which engaged law enforcement, the medical system, and the faith community, and invested in essential social services.
Public awareness also plays an important role. June 15, World Elder Abuse Awareness Day (WEAAD), provides a great opportunity to spread the word about how to prevent elder financial exploitation. On WEAAD, our nation re-commits to building a well maintained elder justice system dedicated to preserving the financial assets and the dignity and independence of older Americans. Working together we can pave the way to a safer financial future.