What Is Financial Abuse?
Financial abuse can be defined as controlling the money to control the person or controlling the person to get control of their money. One study suggested that nearly all domestic violence cases include financial abuse. For example, if you give them an allowance instead of equal access to the household accounts, they can't leave. Financial abuse involving children often takes the form of stealing their identity to borrow money in their name, work under their Social Security Number, or take their modest income from a job and use it for your benefit. The elderly are more likely to live on a regular fixed income or have significant savings that others want to tap, leading to elder financial abuse.
What Is Elder Financial Abuse?
Elder financial abuse is the abuse of the elderly and their money and assets. There are several ways they can be subjected to financial abuse. A typical situation has someone moving in to take care of them, taking over their finances, spending money as they please, and barely taking care of the elder. Another scenario is when someone steals from an older adult. They might take jewelry, cash, or other items from the older person. That's abuse if the person is their caregiver, whether it is a paid nursing assistant or family member who is supposed to be dropping off groceries. Note that reimbursing the person for the food they bought or paying them for services is not financial abuse - that is compensation.
One surprisingly common form of elder financial abuse involves taking guardianship of someone to control them and their money. For example, for-profit organizations have organized networks of individuals who target an elderly person with assets and no family in their lives. They report to the court that the person cannot manage their affairs, generally due to dementia. They get guardianship over the person. This gives them the ability to put the individual in a nursing home without their consent. They can start selling everything the person owns, ostensibly to pay for their care. They receive money for their services. They may keep choice items like jewelry and cash found in the home. They may sell items through a connected estate settlement service and sell the person's home through a realtor friend. Everyone gets a cut of the liquidation of the elder's estate. And the guardian gets a modest fee for arranging all of this plus any kickbacks.
Another variation of this takes the form of getting someone to sign an updated will that names the scammer as their heir. This is so well known that it is now illegal in most states for someone to sign a will that names anyone associated with their nursing home as their heir or have the caregivers as the witness to an updated will. Furthermore, a family can easily contest any new will that names their favorite nurse or home health aide as the heir as faked or coerced because this is so common.
What Should You Do if You Suspect a Senior Is Being Financially Abused?
You can try reporting matters to elder abuse hotlines or adult protective services, but it can be hard to prove matters. This is why it is advisable to speak with an attorney who is experienced in family law. After all, you can't use generic statements like "he's sponged off her for years." Specifics like "her silver set is disappearing piece by piece, and I think the housekeeper is stealing them." Or report what the person said such as, "So and so said she had to write a check out to them for 500 dollars or they'd suffer the consequences".
If the person has been declared incompetent, the first step is to petition to become their guardian. It is almost impossible to restore someone's rights if they've been declared unfit if the guardian is against it. If a trustee or guardian is exploiting the person, you can also ask the courts for records to prove they're managing the money responsibly. This is easier to do if the person set up a trust and named a trustee if you're their next of kin or an alternate trustee.
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