Elder Financial Abuse in Massachusetts

In 2013, there were 21,000 contacts made with the Massachusetts Protective Services which concerned elder abuse – a third of these involved financial exploitation.

In the Massachusetts General Laws financial exploitation is described as the substantial monetary or property loss of an elderly person due to an act or omission of another person.  This exploitation also applies to circumstances where the elderly person has given consent of the act or omission under coercion, threat of force, or misrepresentation.

Financial exploitation is any action that is harmful to the elderly victim through the illegal acquisition, inappropriate use or concealment of funds, assets or property for the benefit of another.  It can encompass misdeeds from theft of money or valuables, unauthorized withdrawals, illicit use of credit cards, identity theft, transferring property, coercing a change in a Will, forging signatures on checks to internet scams.

Because seniors often have accumulated more wealth than the younger population they are attractive targets.  The ability to properly manage one’s finances generally diminishes with age.  A 2010 study found that the annual financial loss due to elder financial exploitation was close to $2.9 billion.

A recent MetLife Mature Market Institute study found that people close to the victim including family, friends, caregivers and neighbors were responsible for 34% of documented financial elder abuse cases.  51% was perpetrated by strangers. Exploitation within the business sector was 12% and Medicare and Medicaid fraud comprised 4% of reported cases.

Much of the financial exploitation goes unreported because the elderly victim fails to report the crime.  This may be due to diminished cognitive or physical ability, reluctance to get a family member in trouble or fear of retaliation.

Unfortunately, the elderly may lack the ability or resources for beneficial social interaction and the resulting isolation becomes a risk for abuse.  Often, the victim is also experiencing neglect or physical abuse.  Being on the watch for the following issues can minimize the risk of financial exploitation:

  • Unpaid bills if someone else is assigned to make payments
  • Additional authorized signers on bank accounts
  • Unfamiliar signers on checks and other documents
  • Bank statements that are no longer mailed to the senior’s home
  • Changes in lawyers or banks
  • Generous gifts or reimbursements to friends, caregivers or charities
  • Mysterious bank account withdrawals, transfers or missing property
  • Unusual purchases or spending
  • Amendments to documents such as power of attorney or inexplicable changes in beneficiaries
  • Excessive interest in senior’s finances by close associate
  • Needing personal care such as grooming items and clean clothes

While there is no guarantee that you or a loved one will never be the victim of financial exploitation, there are steps you can take to protect yourself and those you hold dear.  Working with an estate planning attorney is a proactive way to put safeguards in place before one becomes vulnerable.

An estate planning attorney will assist in writing your will and compose power of attorney documents which incorporate trusts limiting relatives’ access to your finances.  When choosing an individual to act as your agent, choose a trustworthy person who successfully manages her/his own finances.  In the event that you are unable to name a trustworthy, qualified person, consider naming a trusted attorney, accountant or financial advisor.

In addition, you might consider having a trustworthy professional review the financial decisions made by your designated power of attorney agent to ensure that the agent is acting on your behalf.

If you have questions or are concerned about potential financial abuse to an elder in your family, contact us to speak with an attorney and better understand your options.