MetLife Mature Market Institute released a new report which finds that elder financial abuse costs older Americans more than $2.6 billion per year. Broken Trust: Elders, Family and Finances states up to one million older Americans may be targeted yearly and that related costs like health care, social services, investigations, legal fees, prosecution, lost income and assets reach tens of millions of dollars annually.
The study indicates that for each case of abuse reported, there are an estimated four or more that go unreported. Family members and caregivers are the culprits in 55% of cases, although financial losses are higher with investment fraud scams.
“Elder financial abuse has been called the ‘crime of the 21st century,’” said Sandra Timmermann, Ed.D., director of the MetLife Mature Market Institute. “With the present state of the economy, older Americans are at a greater risk than ever of having their financial security threatened. And, for every dollar lost to theft and abuse, there are still more related costs associated with stress and health care and the intervention of social service, investigative and legal entities.”
“This is also a growing problem made greater by the increase in the number of older Americans as targets, the relative wealth of this group, a change in family structure and the availability of technology that may make such abuse somewhat easier,” said Timmermann.
Additional facts from the report:
- Reports vary as to whether women or men are more vulnerable to financial abuse, but loneliness and isolation clearly leave one more exposed to theft. The average victim of elder abuse is a woman over the age of 75 who lives alone (48% of women over the age of 75, according to the Administration on Aging). Men are reported to be particularly vulnerable to the “sweetheart scam.”
- 60% of substantiated Adult Protective Services (APS) cases of elder abuse involve an adult child; sons are 2.5 times more likely than other family members to take advantage of parents.
- In addition to the obvious financial loss, long-term effects include credit problems, health issues, depression and the loss of independence.
- Signs of abuse include indications of intimidation by or fear of a caregiver, isolation from family and friends, disheveled appearance, anxiety about finances, new “best friends” and missing belongings.
- Elder financial abuse can be prevented by the following: 1) education about one’s rights and about the various types of consumer fraud and scams; 2) Financial conservatorship and/or power of attorney for those who are vulnerable; 3) Assignment of responsibility to a trusted outside person, if children are a concern; 4) Additional media attention for this issue; 5) Training financial professionals to properly assist older customers; 6) Assistance from social services, medical/nursing personnel, government agencies; 7) Reporting suspected cases of financial abuse to local authorities.