How to protect older adults from elder financial abuse

No one wants to think about someone stealing from their senior loved ones. Sadly, elder financial abuse is common and can happen at the hands of friends, family, acquaintances, or strangers. 

Education is the key to keeping your senior loved ones safe. Follow this guide to learn what elder financial abuse looks like, how to prevent it, and what to do if you suspect someone is at risk.

What is elder financial abuse?

According to the U.S. Department of Justice, elder financial abuse happens when someone commits any of the following actions against an older adult:

• Takes or keeps the older adult's property for wrongful use

• Deprives the older adult of the right to their property

• Uses their influence to take or control the older adult's property

The National Adult Protective Services Association (NAPSA) has received indications of financial abuse from approximately one in 20 older adults. 

Signs of elder financial abuse

NAPSA also estimates that victims report only one in 44 cases of financial abuse. An older adult may not even know that something is wrong. In other cases, an older loved one feels too embarrassed or ashamed to tell their family members about the incident.

Family, friends, and caregivers can help by watching for common abuse indicators. These include:

• Unusual financial activity, such as unexplained credit card charges or new accounts

• Large unexplained withdrawals

• Missing possessions or property

• Forged signatures on documents

• Suspicious changes to wills, power of attorney, or financial documents

• The sudden appearance of a "new best friend," or a casual acquaintance suddenly becoming a trusted confidante

• Emotional distress, such as confusion, fear, or depression

Financial abuse can make older adults feel helpless, vulnerable, and even worthless. Awareness is the first step to keeping your loved ones safe.

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How elder financial abuse is committed

If you look at all the elder financial abuse examples on record, you'll start to see several patterns, including perpetrator profiles. Here are three of the most common.

Untrustworthy friends or family

The National Center on Elder Abuse reports that family members are the most common perpetrators in financial mistreatment situations. In one analysis, family members committed 54% of financial abuse cases, while partners committed 13%. Common scenarios include:

• Using victim-granted authority, such as joint account holder status or power of attorney, to use the victim's funds for personal gain

• Using stolen checks or "borrowed" ATM cards to withdraw money 

• Persuading the victim to give money, gifts, or property

Any person who takes advantage of an older adult or wrongfully uses their finances can be a fraud perpetrator.

Caregivers

Families should be able to trust those they hire to provide senior care. Unfortunately, some "care providers" exploit that trust to steal money or assets from their clients. Common examples include:

• Collecting payment for care without providing services

• Falsifying time sheets and other records of service

• Using the victim's money to make personal purchases

• Threatening harm if the victim denies the perpetrator access to assets

Strangers and scammers

Scammers frequently prey on older adults, assuming they are more vulnerable, have better finances, and are less likely to report fraud than their younger counterparts. According to the Federal Bureau of Investigation (FBI), over 101,000 adults aged 60 and over reported becoming victims of scams or financial fraud. 

The FBI reported a 14% increase in elder fraud complaints from 2022 to 2023, the most recent full year for which data is available. The most common types are:

• Tech support scams: The perpetrator claims to represent a consumer tech company, such as Microsoft or Apple, claiming the victim has computer problems. They may try to sell a repair or ask for computer access, which they use to obtain account information.

• Government impersonation scams: The perpetrator pretends to be from a government organization, such as Medicare or Social Security, demanding payment or personal information.

• Confidence or "romance" scams: The perpetrator uses a fake online identity to earn the victim's trust and convince them to send money.

• Investment scams: The perpetrator promises high returns for a particular investment, often selling expensive courses or coaching to learn how.

The FBI reports that tech support scams were the most common form of elder fraud in 2023, while investment fraud cost victims the most. 

Tips for protecting older adults from financial abuse

Awareness is the first step to preventing elder financial abuse. Older adults and their loved ones can work together to protect financial resources and look out for warning signs.

Tips for older adults

Predators succeed by taking advantage of older adults' trust. It's important to learn as much as possible about personal security and take the following steps.

Keep financial documents secure

AARP recommends storing financial documents in a fireproof lockbox. That includes:

• Bank statements

• Insurance policies

• Loan documents

• Tax returns

• Social security cards

• Property titles and deeds

• Stock certificates and bonds

• Credit card account numbers and statements

• Locations of legal documents

If any accounts have digital records, keep login information private and secure. Use a unique password for each account and keep passwords safe.

Don't share personal or financial information without proof

Predators often pose as company representatives and even friends or family. If you receive an unexpected message, even from someone you know or a service you use, contact the supposed sender first. Don't open an attachment, click a link, or reply with personal information until you receive a reply to your message.

For example, say you have cell service from Verizon, and you receive an email asking for your password. Instead of replying and asking for proof, call the customer service number. If they can't verify that someone contacted you, delete the message.

Consult a trusted financial advisor or attorney for major decisions

Taking advantage of a loved one's trust is a form of abuse. If a friend or acquaintance tries to talk you into making a big financial decision, ask for some time to consider. Make an appointment with your attorney or financial representative to discuss the possibility.

Any pressure from your "friend" is a major red flag. A trustworthy person will never threaten or shame you for seeking professional financial or legal advice.

Monitor financial activities regularly

Make a habit of checking your accounts for unusual activity. Don't hesitate to call your bank or credit card company about any transactions you don't recognize. 

Caution is always the best policy. It's better to check on a transaction and find it's something you simply forgot about than to assume the fault is yours and lose money to fraud.

Tips for family, friends, and caregivers

Trustworthy loved ones and service providers are older adults' best advocates. Here's how to make financial safety part of your routine.

Talk about common scams

Perpetrators rely on older adults' lack of awareness. Start a conversation about types of scam calls or emails, and remind your loved one never to send money or give account information to someone they weren't expecting to hear from, no matter how convincing the person is.

Share news reports or personal stories of common scams, such as the "grandparent scam" — a call from someone claiming to be the friend of a grandchild, saying the child is in jail or otherwise in trouble and needs money.

The more aware your senior loved ones are of these typical approaches, the better prepared they will be to refuse.

Schedule a cybersecurity session

Fraud perpetrators prey on older adults' assumed unfamiliarity with online security. Ensure your loved one has strong passwords and stores those passwords securely. 

Offer to help your loved ones set up password management software. Studies show that trusted advice helps older adults to embrace these tools.

Plan regular check-ins

Sit down with your loved one monthly or quarterly to review their financial accounts. Ask about unusual transactions or account changes and watch for signs of involvement from new or unfamiliar people.

Meanwhile, watch for financial abuse red flags, such as unexplained emotional distress or secretive financial behavior. 

Reporting elder financial abuse

If you or a senior loved one may be the victim of financial abuse, contact your state's Adult Protective Services or senior services division. Google "report elder abuse" plus your state's name — for example, "Report elder abuse in Illinois" — to get contact information. 

Victims and families in any state can call the National Elder Fraud Hotline at 833-372-8311, or 833-FRAUD-11. Representatives are available Monday through Friday from 10 a.m. to 6 p.m. Eastern time.

You should also report your suspicions to the local police and the older adult's financial institutions. Law enforcement and senior services can advise you on how to prove financial exploitation. You can get a head start by gathering any evidence you can find, including altered legal documents, evidence of suspicious transactions, or proof of missing property.

Helpful resources

Whether you suspect financial exploitation or want to prevent it, help is available from the following organizations:

• National Adult Protective Services Association (NAPSA): Call (202) 370-6292 or fill out the online contact form to request resources.

• National Center on Elder Abuse: Find local contact information for reporting elder abuse, including cases taking place in long-term care facilities.

• Consumer Financial Protection Bureau (CFPB): Download information geared to consumers, caregivers, or financial institutions.

• Internet Crime Complaint Center: File a complaint or learn more about cybercrime trends.

You don't have to face elder financial abuse alone. Stay informed and use the resources available to protect yourself and your loved ones.

To learn more about elder care and discover other resources for families, visit Greenlight's Learning Center.