Friends, relatives, and caregivers are increasingly doing double duty as perpetrators of elder fraud crimes and investment scams, according to the Consumer Financial Protection Bureau. Since mid-June, the CFPB has been gathering public input on the financial exploitation of older Americans. It has received more than 750 comments so far.
The CFPB plans to use the comments to develop tools to help seniors make better financial decisions to safeguard their assets.
Such efforts are certainly needed. Over the years, financial exploitation of older Americans has continued to grow throughout the United States.
“It’s going to continue and get worse as more seniors move into their so-called golden years,” said Don Blandin, president of the nonprofit Investor Protection Trust (IPT), in an Aug. 25 by the Baltimore Sun. “They are still going to have a lot of wealth that could be taken from them.”
In a study conducted by the IPT two years ago, one in five people age 65 and older revealed that they had been the victim of a financial scam. The problem is likely much worse, however.
In a recent IPT poll of 750 experts, including regulators, social workers, elder-law attorneys and financial planners, nearly 80% said the greatest financial threat to seniors comes from family members.
Relatives aren’t the only perpetrators of elder financial fraud. Many older investors are exploited by the financial brokers and advisers they hire to help them manage their investments.
An August 2012 survey by the Certified Financial Planner Board of Standards found that more than half (56%) of the 2,600 financial planners polled had worked with an older client who had been a victim of deceptive or abusive practices by another adviser. Planners say they encourage victims to report abuse to authorities but estimate that only 5% do so.