When people think about elder abuse the first thought goes to the physical or emotional. But there is another kind of elder abuse that, sadly, is becoming more and more common. Rarely acknowledged or discussed, the illegal use of an elder’s income or assets has become increasingly common – and it is a crime.
Expectations are that 2014 will bring more instances of elder financial abuse – a tragedy that will result in estimated annual losses of $2.9 billion. There is history and precedent. One of every six adults over the age of 65 has been a victim of elder financial abuse.
Why the assumption that 2014 will continue the trend and likely be worse? Simple – math. Census data from 2010 showed the greatest number and proportion of people age 65 and older in history – 40.3 million – making up 13 percent of the total U.S. population. Since we are living longer it is projected that by 2050, people 65 and older will comprise 20 percent of the total U.S. population, and the number of victims of elder financial abuse is thus likely to increase in the years ahead.
There are several aspects of financial elder abuse. The first is simple and obvious – the illegal or improper use of an elder’s income or assets by outright theft, deception or coercion. Second, there is the intentional or negligent failure to use the elder’s resources effectively for his or her support and maintenance. Finally, there are breaches of fiduciary relationships, such as the misuse of a power of attorney or the abuse of guardianship or conservatorship authority.
Commonly cited reasons for the recent dramatic increase in elder financial abuse include:
• The incidence of Alzheimer’s disease and other dementias that hinder judgment increases with age. By 2050, some 16 million people will be diagnosed.
• Diminished financial capacity – the ability to manage money and financial assets to meet one’s needs effectively – is more prevalent as one ages.
• Elders are socially isolated, with some 28 percent of non-institutionalized elders living alone.
• Age-related physiological changes to the brain adversely impact “gut feelings” about the trustworthiness of potential predators.
Those who financially abuse the elderly can include not only friends and family but also strangers, neighbors business, professional and financial service providers and in-home caregivers who are not licensed and pre-screened. And while there is an increase in reporting financial elder abuse, it is more likely that only stranger abuse is being reported. Even with an increase in reporting, it is still estimated only one in 14 abuse cases are reported. This is primarily because the victim does not want to get a family member, friend or close confidant into trouble, or because of dementia or other impairments, they do not recall the abuse.
In the next issue of the Caregiver Chronicle, we will offer some remedies to this growing problem but for now see the call to action box on the next page.
Editor’s Note: This is part of a series of columns that will be presented in this newsletter by Sam W. Boone, Jr., a local attorney whose primary practice areas include elder law, estate planning, probate and trust administration. It is hoped that the information will be valuable for caregivers and family members dealing with issues related to elder law.