This article sheds light on the multi-billion-dollar industry of financial exploitation of the elderly. Examples of common scams and frauds are highlighted below, and emphasis is placed on the need for a multi-agency response focusing on teamwork, education, prevention, investigation, and prosecution.

The Scope of Elder Financial Exploitation

It can start with just one word, “Hi,” that comes in as a text from an unknown number. The temptation to respond is accelerated by curiosity. Soon full-blown communication begins with personal information being shared. Gradually the conversation turns to the lifestyle of this new friend who can afford luxuries that most people only dream about. And then the new friend introduces the victim to the world of cryptocurrency. Gradually over time the victim “invests” their life savings into virtual crypto wallets, only to discover later that it was all a fraud.

Another scenario playing out regularly, the telephone rings and someone representing themselves as the “Amazon Fraud Investigation Unit” asks about the recent purchase of a laptop computer. The victim is then told that other suspicious activity has been found linked to their identity, including drug trafficking. The victim is then transferred to another person purporting to be a law enforcement officer from the Federal Trade Commission who persuades the victim to purchase gold bars and withdraw cash and hand them over to “federal representatives” for safe keeping in parking lots. After the life savings are drained, the victim then discovers the harsh reality that this was all a scam.

Such scenarios are repeated every single day throughout the United States and beyond. Various conflicting projections have been made in recent months as to the amounts being stolen from older adults annually. The problem with such surveys is that many victims of fraud do not report the crime because of embarrassment or fear that disclosure might lead to their own independence being compromised. The concern that being identified as someone who has been defrauded will lead to a loss of their independence is real. And while fraud can impact people of any age, there is a good reason to believe that crooks target older adults primarily. All we can say for sure is that elder financial exploitation is indeed a multi-billion-dollar industry.

The impact of this crime is widespread. Not only does it often devastate a person economically, but it can also affect a person’s mental and physical health. And too often there is little or no opportunity to recover the funds, particularly if there is any delay in uncovering and reporting the fraud.

Six Reasons Why Fraud Victims Fail to Report

Fraud suspects often rely on the fact that victims stay silent well after discovering the fraud. Here are six reasons why fraud victims may be reluctant or unable to report the crime:

1. Impairment – the victim may be unable to recognize the fact that a fraud has been committed.
2. Isolation – the victim may be socially disconnected and sometimes even sheltered by the perpetrator.
3. Embarrassment – the victim feels overwhelmed with shame.
4. Loyalty to the perpetrator – despite knowing that the suspect has inflicted a betrayal, the victim is unable to break the bond.
5. Fear of losing independence – the victim relies heavily on the suspect for daily necessities.
6. Fear of retaliation – the victim may believe that reporting the fraud could result in a physical attack.

Forming a Multi-Disciplinary Approach

A multi-disciplinary team approach is necessary to combat this insidious crime. Across the country elder justice task forces are being formed, but there is far more work to be done.

Such teams should be comprised of local law enforcement, Adult Protective Services, county, state, and federal prosecutors, and representatives from financial institutions, as well as other federal agencies such as the FBI, Social Security Administration, and U.S. Postal Inspectors. These task forces can also benefit from having professionals with backgrounds in forensic accounting, trust administration, and estate planning. In addition to fraud perpetrated by anonymous scammers through the internet, there are multiple examples of other forms of elder theft committed by family members, caregivers, rogue contractors, unscrupulous attorneys, and realtors.

Education and Prevention

Education and awareness campaigns are key. Prevention is far more effective than prosecution. Training front line bank and credit union tellers to spot red flags of unusual transactions is imperative and every financial institution should have in place a protocol for identifying and reporting such suspicious transactions.

One effective method is to have the bank or credit union ask their customer or member whether a trusted individual can be named on the account and to provide authority for the institution to contact that individual if there is a reasonable belief that the customer/member is the victim of fraud.

Some states are now allowing the institution to delay the transaction for a couple of days or longer while an investigation can be conducted.

And hopefully professionals such as attorneys, brokers, insurance agents and the like will keep their clients educated regarding common frauds and scams.

Ten Tips

Some basic tips that can help are:

1. Choose a caregiver with great caution. Never hire through a newspaper or through the internet. Only hire through a bonded, insured agency, and only after inquiring about the background checks that are done on the employees.
2. Try to protect incoming and outgoing mail by having a locked mailbox.
3. Consider freezing credit bureau files with the three credit reporting bureaus.
4. Never give out personal information to anyone who calls, even if the caller sounds legitimate.
5. Have a password that only immediate family knows in the event of an emergency.
6. Consider regularly checking your credit report with all three credit bureaus: Equifax, Transunion, and Experian.
7. Before choosing a contractor, check their license through the state agency that issues licenses. Contact the Better Business Bureau (BBB) to see whether they have received any complaints about that contractor. Never pay cash, always pay by check, and make a note of the contractor’s vehicle license plate number.
8. Never be persuaded to withdraw cash or buy gift cards, gold bars or cryptocurrency by someone over the phone or online.
9. Never agree to download software onto a computer by someone else that will then enable the other person to remotely control the cursor.
10. Always file an immediate report to law enforcement and to the financial institution as soon as fraud is discovered. Time is of the essence in any recovery efforts.

Training for Law Enforcement

Law enforcement needs training through E.A.G.L.E. – the Elder Abuse Guide for Law Enforcement – which was jointly assembled by the Department of Justice and the National Center on Elder Abuse. The website is eagle.usc.edu. This resource can help alleviate some common misconceptions that often hinder successful elder financial investigations. For example, there is a widespread mistaken belief that if no threat or violence is used by the suspect, then the transaction is consensual and is not a crime.

Prosecution

More prosecutors need to be willing to take on these cases and work them up as part of a multi-agency team strategy. Thankfully, we are hearing more success stories of suspects of elder fraud being apprehended and held accountable for their actions. Prosecutors are gradually realizing that older victims do indeed make compelling witnesses and typically have considerable jury appeal.

As Helen Keller once wrote: “Alone we can do so little; together we can do so much.”

What can a community do in response to this crime that is becoming more invasive thanks to the introduction of Artificial Intelligence? By building an effective multi-disciplinary team with a focus on prevention, education, investigation, and prosecution, progress is made towards making a difference both in the lives of potential victims as well as suspects.

Retired Deputy District Attorney Paul Greenwood was a solicitor in England for 13 years. After relocating to San Diego in 1991 he passed the California Bar and joined the DA’s office in 1993. For twenty-two years Paul headed up the Elder Abuse Prosecution Unit at the San Diego DA’s Office. In 1999 California Lawyer magazine named Paul as one of their top 20 lawyers of the year in recognition of his pioneering efforts to pursue justice on behalf of senior citizens.

He has prosecuted over 750 felony cases of both physical, sexual, emotional, and financial elder abuse. He has also prosecuted ten murder cases, including one death penalty case.

In March 2018 Paul retired from the San Diego DA’s office to concentrate on sharing lessons learned from his elder abuse prosecutions with a wider audience.

Paul now spends much of his post-retirement time speaking on behalf of AARP nationally, consulting on elder abuse cases, testifying as an expert witness and providing training to law enforcement and Adult Protective Services agencies across the country and internationally.