WASHINGTON-The aging of America and a still recovering economy are leading to many more cases of elder financial abuse, creating a problem some say is approaching epidemic proportions for both victims and credit unions that are often in a difficult position.
Elder abuse experts applaud credit unions for their efforts, saying CUs, along with community banks, do a better job of protecting consumers than big banks from a crime that preys on the lonely and infirm. However, due to the rise of elder financial exploitation, and the amount of it that goes undetected, they say all FIs need to step up their vigilance.
The abuse comes from many directions-Internet scams, home repairmen taking advantage of elders whose cognitive skills have diminished, and very often from family members, a close friend, or a caregiver committing the crime against someone who can't fight back or does not want to.
Due to its rise, financial elder abuse is being called the crime of the 21st century. According to a MetLife study, about $3 billion is lost annually by older Americans to the problem and the losses went up during the financial crisis.
Naomi Karp, older Americans policy analyst, Office for Older Americans at the Consumer Financial Protection Bureau, added that cases of elder financial abuse could increase. "People are living longer now, and Baby Boomers, a very large demographic, are moving into retirement."
A Climbing Caseload
In California, Tristan Svare, deputy district attorney, elder and dependent adult abuse prosecution family violence unit, central division, San Bernardino County District Attorney's Office, has seen his elder abuse caseload climb during the last several years. He said many older Americans have the resources that make them targets and are often considered by criminals an easy mark.
"They can be physically vulnerable, and there is the perception they have memory issues and do not make good witnesses or even know that the abuse is going on. Plus, we are seeing perpetrators viewing it as easier and less risky to steal from an elder next door or family member than going down and robbing the corner market."
The rising number of elder financial abuse crimes represents only a portion of the actual financial crimes against the elderly being committed, sources said. Many cases go unreported because no one recognizes the act as a crime, and often the victims choose not to report the problem. The abuse often comes from a family member or individual the elder is dependent upon, say for care or transportation, and the victim is reluctant-if not fearful-to speak with authorities.
A 2011 study by Lifespan of Greater Rochester and Weill Cornell Medical Center found that only one in 43 cases of the crime are addressed by agencies or programs. Consensus by many experts is that elder financial exploitation is an epidemic whose scope has yet to be fully recognized in this country. Karp said a national survey found that 5.2% of Americans 60 years of age and older are victims of financial mistreatment by a family member.
In Bath, Maine, Midcoast FCU is currently trying to stop what it believes is a case of elder abuse. CEO Gail Richardson said the CU became aware of the threat to an elderly member after overhearing the member's daughter insist the woman come into the CU and withdraw money. "The weather was warm, we had our windows open and heard the daughter verbally abuse the mother. We are also aware that the daughter has been at her mother's workplace-the woman is 80 and still works-pressuring her to come to the credit union and get money."
CU Seeks Police Involvement
The $127-million credit union has had the local police speak to the member several times, but she won't move forward against the daughter, explained Richardson. "She refuses to do anything about it. I am sure she is ashamed her daughter is doing this, but still feels connected to her daughter, loves her and does not know how to stop it. I am sure she is afraid of her too."
Credit unions are keenly aware of this crime, according to the National Federation of Community Development Credit Unions, New York, which runs webinars and provides education on elder financial abuse. The organization addresses this growing crime as part of Better Directions, a Federation program designed to help older members build economic security.
'A Lot of Interest'
The Federation conducted a survey of its members two years ago that included questions about elder financial abuse. "Our credit unions clearly indicated their older members are being abused by family or scammed more often now," said Senior Program Officer Melanie Stern. "We just completed a financial elder abuse webinar on the West Coast and 125 credit unions joined. That tells you a lot about the interest here."
Outside of the frequent hurdle of getting an elder abuse victim to recognize the crime and agree to co-operate with authorities, what can slow a financial institution or those close to the elder to take action is the perception that it is hard to prove financial exploitation, particularly in cases in which a family member is committing the crime and holds power of attorney over the older person's finances.
But California attorney Svare disagrees with that thinking. "These are very winnable cases. Each is unique. When you have patrol officers who are educated to recognize these cases, and get a prosecutor who knows the avenues to explore with the proper charges and the wherewithal to take it into court, we are very successful prosecuting these cases."
Midcoast's Richardson insists that the tide has to turn in favor of more people, financial institutions and local authorities spotting elder financial exploitation and getting victims to take measures to help themselves. "The Baby Boomers, that's a big, big generation retiring. If more is not done to stop the rising tide of elder financial abuse, there is an entire generation of people vulnerable and there will be a lot of money lost."
MORE@CUJOURNAL.COM
Subscribers can read related stories by going to www.cujournal.com and typing the following headlines into the search function:
Trio Charged In $600,000 Bogus Money Order Scam
Geauga CU Looking To Beat Check Scammer
For info: National Federation of Community Development CUs, www.natfed.org; Consumer Financial protection Bureau, www.consumerfinance.gov
