While elder financial abuse hits American pocketbooks hard - anywhere from $3 billion to $36 billion, according to expert research - the emotional cost of this crime is often overlooked.
There should be no doubt that elder financial abuse is a real and growing phenomenon. A recent American Institute of CPAs study interviewing 266 CPA financial planners found that two out of three had encountered fraud or exploitation among their clients. Yet for vulnerable elders, the anguish of victimization is often greater than any amount of stolen money. In fact, only 5% of advisors reported substantial financial damage from elder abuse, while 37% said that the emotional toll inflicted by bad actors was the most difficult challenge their clients faced.
Though the most common form of elder financial abuse reported in the study was perpetrated through phone or internet scams, the reason for emotional scarring is likely due to wrongdoing committed closer to home. 72% of advisors confirmed that they had come across cases of exploitation in which elders experienced an "inability to say no" to relatives demanding "loans," gifts, etc. 57% also cited "support" for non-disabled adult children as a type of abuse they've encountered among their clients. Indeed, the most common form of elder abuse occurs within the family, and this would be the most emotionally wrenching situation to endure - when a loved one takes advantage of physical or mental incapacity, or simple kindness, in order to loot financial accounts and divert funds.
It's somewhat encouraging that only 5% of planners had witnessed serious monetary damage from elder abuse, which shows that the system of checks and balances in place can work. Yet just imagine the ruin that financial predators bring upon those who don't have the benefit of a professional advisor, attorney, etc., who can spot potential fraud and assist in making sound financial decisions. Many senior citizens in our communities are already susceptible to undue influence, manipulation and outright intimidation. If there's no one around to stop it, then not only the level of financial mayhem, but also the level of misery rises. Protecting our elderly loved ones from harm isn't an option - it's our responsibility.