A study commissioned by Pennsylvania Governor Tom Wolf in 2019 recently revealed some alarming findings related to the financial exploitation of older adults.
Financial exploitation of older adults can take many different forms and can be perpetrated by trusted individuals or complete strangers. The most common forms of financial exploitation are unapproved ATM withdrawals, stealing cash, unauthorized credit and debit card use, financial scams and check fraud.
What is it that makes our older population susceptible to financial exploitation? The study finds that the natural process of aging, which can result in cognitive changes, is one of the reasons. Cognitive decline coupled with wealth accumulated over a person’s lifespan can make an older person a prime target.
While an individual may be able to perform the basics of daily living, he or she could become impaired in more intricate activities, such as proper financial management. Financial errors or investment mistakes can signal the onset of a cognitive or physical problem.
Older adults may find it difficult to determine the trustworthiness of an individual and could have trouble reading the cues (such a facial expressions) that a younger person could pick up with ease.
Women are much more likely to be victims of financial abuse than men. This is mostly because women live longer, are more likely to develop dementia than men and are statistically less likely to have managed the household finances.
Some statistics from the study are eye-opening:
- 65% of the perpetrators were family members
- 61% of the victims were female
- 45% of the victims were widowed
- Unauthorized bank withdrawals are the most pervasive method of exploitation
- The average victim is 79 years old
The study found that instances of financial exploitation of older adults tends to be underreported – fear of retaliation or upsetting the family and not being believed by law enforcement are the main reasons. The study projected that both reported and unreported retirement losses to older Pennsylvanians could be as much as $2.5 billion annually.
What can you do to prevent or minimize the possibility of exploitation? Develop a trusted network of family, friends, neighbors and others right now so that you will have multiple individuals advocating for you and checking in on you. If you are widowed and living alone, consider new living arrangements, such as a continuing care retirement community. Sometimes, folks have to get creative, but the worse thing you can do is nothing. Financial abuse cannot be completely eradicated, but putting in place safeguards now will pay dividends later.