False Facts Empower Financial Abuse

Here is a fine example of how an article by a nationally syndicated columnist can mislead and misdirect the reader.

Scammed by your own family More than half of elder abuse financial cases involve an adult child
By Lew Sichelman Published: Mar 23, 2012 12:01 a.m. ET



“More than half of elder abuse financial cases involve an adult child… About 60% of the financial-abuse cases substantiated by adult protective services involve an adult child. Sons are most likely to rip off their parents or grandparents, the study found, even more so than a paramour, bogus contractor, fly-by-night handyman or shady lender…”    

The author took this information from a 2009 MetLife’s Mature Market Institute report… but in June 2011, MetLife released another national report correcting their mistake – family members are NOT the most common offenders. The author wrote this article later in March, 2012, ignoring the correction.  Although they have been at times, most of my cases did not involve the adult children as the abusers.

“And it is all legal, according the elder abuse authorities in Los Angeles….Unless someone is declared incompetent, they can give away all their money to anybody they want to as long as they have not been declared incompetent….”

This is very misleading for someone reporting financial crimes against their loved ones. Although lack of capacity does have to be proven, an exploitation victim does NOT have to be formally declared incompetent, or under guardianship to be a victim…In fact, over 90% of my cases over 30 years, involved someone who did not have the capacity to give consent reference financial matters, due to short-term memory loss. This was confirmed by expert testimony/medical records, but there was no formal declaration of incompetency and the victim was not under a formal guardianship at the time.

“Loneliness and isolation raise the risk of elder financial abuse, which covers a lot of territory, including theft, misuse of financial instruments such as powers of attorney, investment fraud, home repair schemes and identity theft. The high rate of dementia among seniors makes them a tempting target, especially when they own their homes free and clear and have good credit ratings.”

This quote is spot on!  Thanks for reading and feel free to share.


2016: The Year to Go Long in D.C.

Posted: 01/07/2016 4:20 pm EST Updated: 01/07/2016 4:59 pm EST

senior woman patient lying in bed at hospital ward
The start of the New Year brings the resumption of the 114th Congress and the start of the NFL playoff season, both of which contribute to one idea: “going long.” In football, “going long” down the field moves the ball forward and sometimes scores touchdowns. We should encourage President Obama, Congress, and all the candidates for President to go long on behalf of new proposals and policies to benefit older adults and their families.

It has been said that there is really no good policy without politics. In this presidential and congressional election year, good politics should include being responsive to advancing new ideas to move our aging society productively into the future. It makes good political sense for candidates because the older voter will grow from 16 percent of the electorate in November 2012 to 23 percent in November 2016. In addition, the number of family caregivers in this nation now exceeds 40 million and they too represent an important voting constituency that can influence the outcome of this election.

What would going long include? For the president and congress, it could be building off the bipartisan momentum from late 2015 by passing the Older Americans Act. Candidates for President could call for the reauthorization of the Act so it becomes a political issue as well. A bipartisan bill to renew the Act for three years passed the Senate in July of 2015. President Obama has already supported it at the 2015 White House Conference on Aging. The House needs to act to finish the job and pass the Act as well. This legislation benefits older adults with critical community-based services such as nutrition, transportation and senior centers. It also contains the only federal program aimed at helping family caregivers, including grandparents raising grandchildren. The need to help provide education and training to family caregivers has grown exponentially since the last Older Americans Act was passed back in 2006.

On the caregiver front, the House should join the Senate in passing the RAISE Family Caregivers Act. The Recognize, Assist, Include, Support and Engage (RAISE) Family Caregivers Act (S. 1719/H.R. 3099) requires a strategy to be developed that would identify actions that government, communities, providers, employers and others can take to support family caregivers. This would be a first step in going long for caregivers.

To further help caregivers, they should be part of tax reform, which may be a 2016 bill in Congress and certainly a political issue for the future. For every millionaire or special interest who is aided by tax reform we should include an interest that is truly special–the family caregiver, by providing them with a meaningful tax credit for the high out-of-pocket costs associated with caregiving. For Presidential candidates who address tax reform, this should be part of what they propose.

We as a society need to go long on one especially critical issue that we seem to be in political and policy denial about — the need for long-term services and federal policies which promote them. Despite the millions of Americans of all ages who need long-term services and support, we still lack any coherent national policy to provide this. There have been many great ideas and proposals developed in recent years both from outside and inside government. It would be difficult for Congress this year to enact anything comprehensive on long-term services and support, but it is most certainly a compelling campaign issue which has begun to be raised by candidates on both sides. However, it needs to become an issue with a political imperative.

We also need to go long on combating the growing menace of elder abuse in our nation. Congress passed a landmark law called the Elder Justice Act in 2010 but has struggled to fund it properly. We need to go long in this Congress using the new budget agreement and commit at least $50 million for programs to combat elder abuse. This has to be a test on the campaign trail as well. Those candidates who fail to offer ideas or even address this issue should be judged unworthy of an older person’s vote.

We have already seen the big aging issues like Social Security and Medicare raised by Presidential candidates on the campaign trail. The ideas and proposals have run the gamut, but with the first votes in primaries and caucuses ready to be cast in fewer than six weeks, it is time for more specifics on how we address the future of these vital programs. The opportunity is there for candidates to make their mark and go long.

A final important way for candidates for President to go long would be to address the growing issue of ageism in America. Further, in recognition of the changing face of the older population now and in the future, candidates for President should outline their ideas on achieving cultural competency in federal programs and services in the future.

In this unusual year, where many contentious Congressional issues were resolved in the last year, the same opportunity to go long in 2016 is there for the President, the Congress and those who will be in these positions in 2017. Older Americans and their families would certainly benefit from this.


Growing financial exploitation prompts legislation mandating advisers to report suspected abuse


Donald Chambers backs requiring financial advisers to report suspected fraud involving older people.

Grappling with growing financial exploitation of the elderly, state officials are pressing for laws that require financial advisers to report suspected “elder fraud” to authorities.

But the mandate faces pushback from the financial industry, which says it could result in a massive number of reports that turn out to be false.

People 60 years and older were involved in 171,230 fraud complaints tracked by the Federal Trade Commission in 2014, more than double the number in 2010, although some of that jump could come from improved reporting.

American retirees are exercising greater control over their finances, given the decline in traditional pension plans. But the complexity of managing and investing savings poses a challenge, particularly as the U.S. population ages, resulting in a greater number of people projected to get dementia. That has opened up avenues for exploitation.

The fraud ranges from sweepstakes scams and bogus investment schemes to dishonest caregivers or family members skimming funds. In some cases, investment advisers or stockbrokers churn accounts through unnecessary trades, resulting in high fees or losses.

Elder financial abuse is expected to “grow dramatically,” according to Rick Fleming, head of the Office of the Investor Advocate at the U.S. Securities and Exchange Commission. Older Americans lost at least $2.9 billion to financial abuse in 2010, up 12% in two years, according to Metropolitan Life Insurance Co. , which tracks issues facing the elderly.

To help curb the problem, a coalition of state securities regulators in September proposed a model state law that would require financial advisers, including brokers at large investment houses and independent advisers, as well as their supervisors, to report suspected elder financial fraud to both a state securities regulator and an adult protective-services agency.

The legislation would mandate prompt reporting by a financial adviser who “reasonably believes that financial exploitation” of an older person “may have occurred, may have been attempted, or is being attempted.”

The bill gives brokers and advisers civil immunity from privacy violations for reporting suspected fraud, and allows them to put a temporary hold on suspicious account disbursements.

Supporters say advisers and brokers are well-positioned to raise early warnings about exploitation that can leave elderly victims with scant money left for necessities and little time to rebuild savings.

“In the long run we’ve got to say the greater good is served by making it mandatory and trying to protect the vast amount of people,” said Joseph Borg, Alabama’s securities commissioner. He plans to introduce such legislation early next year.

But financial-industry trade groups are pushing back against a key part of the North American Securities Administrators Association’s proposal. They say its reporting mandate would overburden state agencies, while some financial advisers worry they could be sued if they miss an abuse case.

Roughly 40% to 50% of all “red flags” about suspicious activity turn out to be false, according to an Oct. 29 letter to NASAA from the Securities Industry and Financial Markets Association, the main Wall Street trade group. A voluntary reporting system would allow firms to check out such reports internally before going to authorities, it said. Some financial firms already have in-house units that monitor for elder confusion or abuse.

Laws requiring professionals such as social workers to report elder abuse are common. Roughly half of the states also mandate elder fraud reporting by certain financial professionals.

But the laws don’t always extend specifically to financial advisers. Kansas’ law doesn’t generally treat brokers as mandatory reporters, according to the state’s securities commissioner. Meanwhile, Ohio’s law requires lawyers to report suspected elder financial exploitation, but not financial advisers.

In New York state, which doesn’t have a mandatory reporting law, only one in 44 cases of elder financial exploitation was reported to authorities in 2008, according to a 2011 study by Cornell University and aging agencies.

“We’re losing valuable time that we could provide that safety net for that elderly individual,“ said Judith Shaw, NASAA’s president and securities administrator in Maine, which lacks a mandatory fraud-reporting law.

That troubles Donald Chambers, 86, a retired University of Kansas professor who manages his investments through a broker but said he may not be far off from having to delegate the task to a family member or his lawyer.

If his broker had any suspicions he was being defrauded, Mr. Chambers said he would feel better knowing that the broker was obliged to bring those hunches to an investigator. It is “simply a wise idea,” he said.

Similarly, Philip Marshall believes mandatory reporting might have helped his late grandmother,  Brooke Astor, the New York philanthropist. She was financially exploited by her son, Mr. Marshall’s late father, as she suffered from dementia, a jury found in 2009.

“Certainly there were irregular patterns in terms of financial transactions,” said Mr. Marshall, a university professor and advocate for the prevention of elder financial abuse.

“There is no black eye, no blood, but the truth is, this ends up breaking victims,” said Elizabeth Loewy, the former chief of the elder-abuse unit in the Manhattan District Attorney’s Office.

Every state has adult protective-services agencies to investigate reports of abuse, neglect and exploitation of older adults. But dementia, embarrassment, or reluctance to report family members all play roles in low disclosure rates, said Kathleen Quinn, executive director of the National Adult Protective Services Association, a group for those agencies.

In a 2014 survey by the group, 44% of agency officials said financial institutions were frequently unwilling to provide a client’s records, and 40% reported long delays obtaining records.

The Financial Industry Regulatory Authority, Wall Street’s self-regulator, recently proposed its own rule to allow firms to put temporary holds on suspicious account disbursements, though the proposal doesn’t address mandatory reporting.

Currently, even when financial advisers suspect an aging client is being taken advantage of, many say they are hamstrung by strict rules governing the execution of trades and processing of withdrawals, and worry about violating privacy laws if they report concerns.

The current system, “kind of puts advisers and firms in between a sort of legal rock and hard place,” said Steve Kline, director of state government relations for the National Association of Insurance and Financial Advisors, a professional association. The proposed rules aim to provide clarity.

Financial Abuse of the Elderly: A Detective’s Case Files of Exploitation Crimes

Joseph Roubicek. Financial Abuse of the Elderly: A Detective’s Case Files of Exploitation Crimes. Ruby House Publisher. 2008. 161 pages.


Although elderly individuals are often the victims of fraud, there is another type of financial abuse that is more difficult to prosecute. This sometimes shocking book explains how the elderly are often exploited financially and offers some tips to avoiding such exploitation.

Written by Joe Roubicek, a former detective with the Fort Lauderdale Police Department who investigated more than 1,000 cases of exploitation against the elderly, Financial Abuse of the Elderly offers a sobering view of how predators are able to take advantage of elderly individuals. Mr. Roubicek provides examples from actual cases he investigated to illustrate the difficulty in catching these financial abusers.

Roubicek emphasizes the difference between fraud and exploitation. While fraud involves deception, exploitation involves taking advantage of an elderly person’s disability, such as short-term memory loss. Exploiters often convince an elderly victim to give them gifts, and before long a bank account can be emptied. According to Roubicek, such exploitation is difficult to stop because it appears the elderly individual is acting voluntarily.

While Roubicek offers some recommendations, such as trusts and powers of attorney, for protecting yourself or someone you love from being exploited, the book is mainly an eye-opening look at how to recognize financial exploitation in all its heartless forms.

New study, bill puts focus on senior fraud

Teaching police dispatchers about fraud vulnerability might lead them to encourage senior callers who fit Lichtenberg’s profile to file complaints.

|By Diane C. Lade, Sun Sentinel

New efforts are underway to combat what aging experts say has become one of the top threats facing elders: losing their savings to con artists and financial predators.

Gerontologists at a Detroit university have created, for the first time, a potential victim profile that could alert professionals and families to which seniors are most psychologically vulnerable to fraud.

And a bipartisan bill filed last week by U.S. Rep. Ted Deutch, a Democrat from Boca Raton, and two other representatives would create a federal advisory office dedicated to protecting elders from fraud and ensuring victims’ complaints are handled efficiently and quickly. Deutch was joined by Congressmen Vern Buchanan, R-Fla., and Peter Welch, D-Vt.

Deutch’s bill mandates that the Federal Trade Commission, which would house the new office, “immediately” funnel elder fraud and exploitation reports to appropriate local law enforcement or regulatory agencies for investigation, something the FTC is not required to do now. The new office also would alert elders to new scams and educate them about investment fraud,

“I am impressed, and not in a positive way, with how much time, energy and sophistication is going into some of these scams,” said Peter Lichtenberg, director of Wayne State University’s Institute of Gerontology and the researcher behind the elder fraud victim profile. “We need to be thinking about who is vulnerable, and know more about how older adults make their financial decisions.”

His study of 4,400 people age 60 and older found those with high depression levels, and who scored low on tests gauging how valued and connected to others they felt, were almost 300 percent more likely to report having lost money to scams or fraud. None of Lichtenberg’s subjects had Alzheimer’s or any memory-impairing medical conditions that can leave elder patients open to fiscal predators.

The study, done in conjunction with the Illinois Institute of Technology and published in the current issue of Clinical Gerontologist, also suggested there’s an additional issue for younger seniors, or those under age 74, who were fraud victims: They were more likely to report being financially dissatisfied.

“These were people looking to make more money for their retirement and didn’t have many avenues available,” Lichtenberg said.

Lichtenberg’s next project is to develop a rating scale and checklist that could guide health-care workers, law enforcement and aging service professionals in determining when a senior might be at risk for fraud. He plans to create public education materials on fraud vulnerability for elders and their families as well.

Jacquelyn Browne, director of the Master of Arts in Gerontology program at Nova Southeastern University, said Lichtenberg’s work shows how isolation and mental health issues affect seniors in ways many people don’t realize.

“Financial vulnerability is an area that probably does not get assessed or isn’t on a clinician’s radar,” she said. “This looks at the bigger picture of looking at an elder’s quality of life.”

Financial abuse of elders has become a top concern for regulators, and spurred Deutch’s bill. Complaints to the FTC regarding fraud against people age 60 and older almost doubled between 2010 and last year, with 115,892 filed in 2012 — one quarter of all fraud complaints.

There were 1,264 allegations of senior financial exploitation in Broward and Palm Beach counties, and 8,477 statewide, filed with Florida’s abuse hotline last fiscal year.

Assistant State Attorney Richard Sherman Jr., with the Broward State Attorney’s Office elder exploitation unit, finds seniors in his fraud cases often are living alone, have a disability and are sad. “They latch on to people who appear to take an interest in them, but then who rob and betray them,” he said.

Experts agree that senior exploitation often goes unreported, as the victims are in denial or feel ashamed and guilty about losing their money.

Robin Taylor said her father, a Hollywood retiree who died at 95 last month, wrote multiple checks totaling $90,000 to a woman half his age who had befriended him. Taylor said her dad, a World War II veteran and former salesman, for more than a year refused to believe the woman was lying about needing cancer treatments and money for other emergencies, and believed her promises to repay him.

The two had met very shortly after the elderly man’s wife had died “and I think my father was very lonely, very angry about being old,” said Taylor, a former deputy district attorney in Colorado, who eventually persuaded him to file a police report. “He felt good being able to help her.”

Broward SAO investigator Joe Roubicek said teaching police dispatchers about fraud vulnerability might lead them to encourage senior callers who fit Lichtenberg’s profile to file complaints. “We hear that sometimes seniors try to report fraud but are turned away by law enforcement telling them it’s a family matter,” he said.