Fighting Elder Financial Exploitation

Elder Financial Exploitation

Elder abuse is a serious and widespread problem in the United States. In fact, about 1 in 10 people aged 60 and above have experienced some kind of elder abuse, according to reports from the National Council on Aging. Most people think about elder abuse in terms of physical abuse or neglect, however, there are six common types of elder abuse. They are as follows:

  1. Neglect
  2. Physical abuse
  3. Psychological or emotional abuse
  4. Sexual abuse
  5. Abandonment
  6. Financial abuse

Abusers can range significantly and some may seem surprising. From family members and friends to staff at assisted living or nursing home facilities, the elderly community is one of the most vulnerable to abuse and mistreatment. Elder financial exploitation is one of the fastest-growing types of elder abuse. With more and more tools at their disposal, abusers have been empowered to take advantage of this often helpless community.

Unfortunately, financial abuse of the elderly is not always easy to spot, and in some cases it is even harder to prove. Defined as the improper or illegal use of an elderly person’s assets, funds, or property, financial exploitation is often committed by someone close to the victim. There are a variety of schemes aimed at random elder individuals, however, the majority of elder financial abuse is by a family member or a trusted individual.

Forensic Accountants Aid in Elder Financial Abuse

Perpetrators, particularly family members, tend to justify their actions when it comes to financial abuse. For instance, many claim that they were just taking a loan, taking an advance on their inheritance, or even that they deserve some compensation for helping their elderly family member. The reality is that these people are taking or using funds illegally and unbeknownst to the owner of said funds.

A forensic accountant is often brought in to figure out the extent to which the financial abuse has occurred, reviewing the elder’s financial records to make a determination. Going through bank accounts and a variety of additional financial records would seemingly indicate where the abuse was coming from. However, there is often not a straightforward answer.

One concept that has gained traction over the last several years is Enhanced Multidisciplinary Teams (E-MDT). E-MDTs were established in 2012 in New York with the goal of tackling financial exploitation in addition to addressing other co-occurring types of abuse. They are typically comprised of a group of professionals like accountants, social workers, therapists, law enforcement officials, bankers, medical experts, and representatives from Adult Protective Services as well as local district attorneys.

E-MDTs are primarily focused on investigating, intervening, and ideally preventing elder financial exploitation. The forensic accountant plays a vital role in the team. In fact, while the majority of E-MDT members are there voluntarily, the initial funding grant included funds to pay geriatric psychologists and forensic accountants. While the growth of E-MDTs has been slow nationwide, it has certainly been steady.

As more and more people become aware of the widespread nature of elder financial exploitation, the need for proactive involvement increases accordingly. Forensic accountants will be called upon to serve as invaluable resources for the elder community. As funding for these services is likely to increase, the role of the forensic accountant will prove to be critical in the prevention and detection of elder financial abuse.