Biggest Culprit to Parents’ Wealth: Family
by Tracy E. Hill, Ph.D.
The Pennsylvania Department of Aging recently concluded the “Financial Exploitation of Older Adults Study Report” which audited random case files (455) from ten PA Area Agencies on Aging over more than a dozen counties which had reported considerable exploitation (financial) cases three years ago. The studies significant findings reinforce the need for the Older Adults Protective Services Act (OAPSA) to protect exploitation of older adults from their own family members.
The PA Department of Aging stated, “Older adults are at an increased risk for financial exploitation due to health changes which occur during the natural aging process, as well as their steady income, accumulated wealth, and retirement savings over their lifespan.” Moreover, they cited research by the University of California (Castle, et al., 2012) which demonstrated that older adults often lose the ability to recognize their gut instincts as it relates to violations of trust as well as their ability to assess risk. This change in one’s brain functioning is associated with the aging process as well as cognitive changes related to dementia and Alzheimer’s. The minimized capacity to assess risk and trust their own gut has a positive correlation with the large numbers of older adults getting financially scammed.
The study also compared information from three other states who have conducted similar studies (Maine, New York and Utah). Overwhelmingly, the studies (including Pennsylvania) confirmed that the common perpetrator of an older adults was a “member of the older adult’s family, usually an adult child or grandchild, and used more than one method of financial exploitation on the victims.”
In Pennsylvania, the average loss to each victim was $40,000. Overall, older Pennsylvanians collectively experienced an estimated loss of $58 million dollars during one fiscal year due to financial exploitation. The biggest culprit was unauthorized bank withdrawals from family members bank accounts using debit cards, ATM withdrawals and checks written on mom/dad or grandma/grandpa’s accounts.
What can you do to help protect your family’s fortune?
1) Check bank accounts daily or weekly. I recently discovered a family member who stopped paying their loan to Mom due to a “glitch” in their automatic withdrawal and payments. If I did not check my mother’s accounts weekly, this may never have been discovered.
2) Hire a trustworthy accountant to make quarterly assessments of your parent’s finances. If you are not financially savvy, or your parents do not entrust you to have access to their finances, a professional accountant is a good way to go.
3) Obtain a POA (Power of Attorney) for a trusted member of the family to ensure that someone has the right to act on your parent’s behalf if needed. My mother lost her cell phone for three weeks and until I obtained the POA, I was not able to cancel her service on her behalf (Mom had forgotten her user name/password for me to do it online).
4) Remove all checks from your parents’ house if they have dementia or Alzheimer’s. My mother wrote a check to her handyman for $8,000 before we found it on her bank statement. She told me it was a “loan.” By the time it was discovered, it was too late to stop it. I called the handyman to let him know that the loan was being called in. Last year, Mom wrote a $500 holiday gift to her aide before I thwarted it and let the aide know that keeping the money would be criminal (elder laws) and an inappropriate gift amount.
5) If you suspect your parent(s) is a victim of abuse, neglect or exploitation please call your state Protective Services Office. Most states have a reporting hotline that is open 24/7/365. Click here to find out about your state: https://www.napsa-now.org/get-help/how-aps-helps/
If you have a story to tell, let us know on Facebook: https://www.facebook.com/silversagemagazine/ You may just save a family thousands of dollars by sharing your family’s misfortune.
Photo by Tyler Nix (Los Angeles CA) @tylernix