FinCEN Warns Institutions of Elder Financial Fraud

The Financial Crimes Enforcement Network (FinCEN) published an advisory to assist the financial industry in reporting instances of financial exploitation of the elderly on Tuesday.

The advisory contains examples of “red flags” based on activity identified by various state and federal agencies and provides a common narrative term that will assist law enforcement in better identifying suspected cases of financial exploitation of the elderly reported in SARs.

“Financial institutions can play a key role in addressing elder financial exploitation due to the nature of the client relationship,” said FinCEN.  “Often, financial institutions are quick to suspect elder financial exploitation based on bank personnel familiarity with their elderly customers.”

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According to the alert, there has been an upward trend at the federal level in Suspicious Activity Reports (SARs) describing instances of suspected elder financial exploitation.  Analysis of SARs reporting elder financial exploitation can provide critical information about specific frauds and potential trends, and can highlight abuses perpetrated against the elderly.

“Financial institutions care about their customers and in some cases may be uniquely placed to identify when customers are possible victims of elder financial exploitation,” said James H. Freis, Jr., FinCEN Director. “Elder abuse in any form is intolerable. Working with feedback from financial institutions, FinCEN developed this new red flags tool as a way for depository institutions in particular to combat elder financial exploitation.”

Some of the potential indicators of elder financial exploitation include erratic or unusual banking transactions, or changes in banking patterns, frequent large withdrawals, including daily maximum currency withdrawals from an ATM, ncharacteristic attempts to wire large sums of money, and more.

To view a copy of the full report, see here.

 

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  • I wonder what their reaction would be if they saw the transactions of Warren Buffett. Would they accuse Bill and Melinda Gates of ripping Warren and Astrid off? Are these inventors of red flaggs capable of comprehending the financial transactions employed by some of us who are obviously too old to make our own decisions (LOL)?

    How would the red flags be monitored and is there any adjustment for the financial acumen and age of the senior? These best intentioned oversight warnings seem to trend towards loss of choice and loss of financial independence for seniors. Is that their need or someone’s unnecessary worry? Are the tails of the bell shaped curve what establish rules or is the vast area in the middle with rules to deal with the tails?

    Will the individuals monitoring these “red flags” have the business acumen and savvy to recognize responsible market behavior and irrational and unreasonable guidelines when applied to specific situations? As one who recently crossed the 62 age boundary, has it been determined that I am no long competent or as financially alert and astute as those who propose these ideas?

    Senior advocates need work. Let’s find them real jobs instead of allowing them to make jobs for themselves on the back of government oversight. If someone with similar credentials wants to challenge my personal decision making that is one thing but if some senior advocate with degrees in anthropology and psychology want to make those same assertions that is something else again.

    It seems in current society exceptions are the basis of rule making. Not only is under regulation terrible but so is over regulation as well. We are in the era of creating far too many new rules, guidelines, and red flags.

      • Regguy1,

        In a Republic, one person, father time with the help of Congress, the courts, at times different administrations, an active press, and a strong and active electorate.

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