Financial exploitation has been called “the crime of the 21st century” with one study suggesting that older Americans lost at least $2.9 billion to financial exploitation in 2010 by a broad spectrum of perpetrators, including persons they know and trust, as well as strangers. Cognitive impairment diminishes the ability of some older adults to make financial decisions and to detect frauds and scams.
Elder exploitation cases tend to be complex and can be difficult to investigate and prosecute. Elders can lose their life savings and can have little to no opportunity to gain them back, which means they may receive inadequate health care as they age, and they may lose the ability to live independently due to lack of funds.
What is Elder Financial Exploitation?
Financial exploitation is the fraudulent or otherwise illegal, unauthorized, or improper actions by a caregiver, fiduciary, or another individual in which the resources of an older person are used by another for personal profit or gain; or actions that result in depriving an older person of the benefits, resources, belongings, or assets to which they are entitled. Florida law says that the elements necessary to establish that an elder or disabled person has been subject to exploitation are:
the victim was a vulnerable adult
the defendant wrongfully appropriated the victim's property
the defendant knew, or should have known, of the wrongful nature of its conduct.
Common Examples of Elder Exploitation
While every situation is different, here are some common ways the elderly may be exploited:
Exploitation by an agent under a power of attorney or person in another type of fiduciary relationship
Theft of money or property, often by a family member, caregiver or in-home helper
Investment fraud and scams, including deceptive “free lunch seminars” selling unnecessary or fraudulent financial services or products
Lottery and sweepstakes scams
Grandparent/imposter scams
Tax and debt collection scams
Scams by telemarketers, mail offers or door-to-door salespersons
Computer and Internet scams
Contractor fraud and home improvement scams
Ways to Minimize Risk of Elder Exploitation
When creating your trust and power of attorney, you need to pick the right fiduciaries to help you. Here are some tips on finding the right person/persons to name as your successor Trustee, power of attorney and health care surrogate:
Trust, but verify. Only appoint someone you really trust and make sure they know your wishes and preferences. You can require in your POA that your agent regularly report to another person on the financial transactions he or she makes on your behalf.
Avoid appointing a person who mismanages their own money or has problems with substance abuse or gambling.
Tell friends, family members, and financial advisers about your power of attorney (POA) so they can look out for you.
Remember that POA designations are not written in stone – you can change them. If you decide that your agent isn’t or is no longer the best person to handle your finances, you can revoke (cancel) your POA.
Avoid appointing hired caregivers or other paid helpers as your agent under a power of attorney.
Beware of someone who wants to help you out by handling your finances and be your new “best friend.” If an offer of help seems too good to be true, it probably is.
An Estate Plan Can Help Protect Against Exploitation
One of the main things you can do is to create an estate plan and prepare for your incapacity. Creating your estate plan generally means planning for your death and your incapacity. You have worked very hard over your lifetime, so having a plan in place to make sure that your assets and property get to the right people after you pass away is so important.
We are dedicated to working with you to simplify the complex process of planning your estate, whether it is that you need a will or a trust – all to ensure that your wishes are followed after your death, and that your family’s financial future is protected. We pay particular attention to structuring your estate in a way that minimizes the expenses and time on your family and helps to avoid any family disagreements in the event of your death.