Financial Exploitation

Elder exploitation is widespread. Financial abuse against adults over age 65 is so rampant that several federal agencies, including Consumer Financial Protection Bureau (CFPB) and the Federal Deposit Insurance Corporation (FDIC), issued a public interagency statement to highlight the issue to their agency staff and provide strategies to combat the problem. According to the CFPB, elder financial exploitation quadrupled from 2013 to 2017. Financial abuse has continued to soar to epidemic proportions, and was exacerbated by the COVID-19 pandemic. The AARP reported that elder financial exploitation doubled during those years, as nursing home staff shortages and more people staying at home led to even higher numbers of vulnerable seniors.

Millions of seniors every year are targeted by scammers or, sadly, taken advantage of by family members, caretakers, or other trusted individuals. Victims often feel shame or embarrassment and therefore don’t report these crimes. The vast majority go unreported. Researchers report that monetary losses are much larger when the suspect is someone the person knows. Some estimates put the loss to seniors and financial institutions across the U.S. at close to $30 billion every year.

Signs of exploitation include:

• Change in quality of living conditions
• Unusual, inappropriate bank activity
• Sudden changes in estate planning documents, such as wills and powers of attorney
• Repeated borrowing of money without repayment
• Unexplained missing items or valuable personal property
• Caregiver refusing to answer questions or leave when requested
• Overdue or unpaid bills
• Frequent large and/or unexplained gifts of cash

Particularly if they have been taken advantage of already, seniors are encouraged to put fraud alerts on credit cards and take other precautions such as freezing credit in certain circumstances and contacting one of the credit reporting agencies.

Individuals who have been victimized online can report to the FBI’s Internet Crime Complaint Center at https://www.ic3.gov/. Depending on the situation, theft or fraud should also be reported to either the Texas Department of Consumer Affairs, Texas Attorney General Consumer Protection, FINRA, or the Social Security Administration.

In 2021, in response to escalating financial assaults on older adults, the Texas Legislature passed a law criminalizing financial abuse against seniors. The law adds this crime to existing laws related to theft and fraud: Texas already had higher penalties for fraud, credit card abuse, and the like, when committed against seniors. For example, if an agent under a person’s durable power of attorney is found guilty of misapplying between $750 and $2,500 of the person’s funds, it’s a Class A misdemeanor, but if the victim is age 65 or older, the punishment is increased to the next higher category, which for this amount is a state jail felony.

Texas law requires anyone who has cause to believe that an elderly person’s physical or mental health, welfare, or financial welfare has been or may be negatively affected to report it to Adult Protective Services (APS). Exploitation is defined as someone who uses the money or information of an elderly person or person with a disability for their own benefit or financial gain without the informed consent of the person.

Failure to report elder abuse, neglect, or financial exploitation to APS can result in a Class A misdemeanor. A person who knowingly makes a false report to APS may be charged with a Class A misdemeanor. To make a report of suspected or known elder abuse, call the Texas Adult Abuse Hotline toll-free at 800-252-5400 or report online at www.txabusehotline.org.

You may visit our website at www.wrightabshire.com. Nothing contained in this publication should be considered as the rendering of legal advice to any person’s specific case but should be considered general information.