Financial and Fiduciary Abuse
Many people seek fiduciaries and elder care services for their grandparents, especially if their grandparents are trusting.
Grandma is an easy target. In this case, Grandma is a senior or elderly person. She also may have the beginnings of dementia. This makes her vulnerable to exploitation. She welcomes people who visit her, and she wants to please them. Is that situation safe for her financially?
Some family members truly want to help and may come to visit Grandma. During their visit, they might write out checks to pay Grandma’s bills. Grandma trusts her family members, so when she’s presented with a check on her account and is told to sign it, she does so willingly. That’s great if it’s an ethical family member. What happens if Cousin Tom isn’t one of those family members?
Family members can be immediate family, extended family, family that lives close by geographically or long distance. All it takes is spending some time with Grandma physically or on the phone. If a family member tells Grandma they need money, she’ll want to help. Of course, there are also family members who write themselves a check and just tell Grandma they are paying her bills and she needs to sign it.
Seniors can become very dependent on their caregivers, especially when they don’t have other people visit them on a regular basis. Stories from unethical caregivers about their own financial woes (not having the money to pay for college education for their kids or not having a retirement plan) can pull at the heartstrings of the senior. Maybe, they just need a short-term loan — which they never pay back. Grandma will give the caregiver a large sum of money to cover their shortfall.
Sometimes Grandpa dies or moves into an assisted care facility, and Grandma is left alone. Sometimes a neighbor shows up at the door to help Grandma, or Grandma meets someone new at the grocery store or in the parking lot of the bank. As soon as the “friend” finds out that Grandma is alone and vulnerable, money starts to disappear.
If Grandma is living in an assisted living or long-term care facility, she may keep cash in her room “just in case she needs it.” She also may have her checkbook or debit card with the password on it in her possession. All of these items are easily accessible by other residents who walk into Grandma’s room. Sometimes it’s unethical staff members who will steal from Grandma while she’s having a meal in the dining room or on a facility sponsored field trip.
Unfortunately, we hear too often of the phone calls Grandma receives — supposedly from a grandchild who says they are out of town or the country and need to be bailed out of jail. Grandma is asked to wire money immediately. If she does wire the money, there’s usually more phone calls asking for even more money for fines or transportation. Of course, the grandchild is really at home while all of this activity is happening.
The other common scam targeting Grandma is a caller who claims to be from the IRS. Grandma is told she owes the IRS for income taxes, penalties and interest not paid for prior years. The caller threatens to levy her bank accounts or home if the taxes aren’t paid immediately by wire.
Criminals attempt to steal Grandma’s identity to open new credit card accounts, apply for loans in her name, drain her bank accounts and illegally obtain multiple driver’s licenses and birth certificates.
Another thing criminals will do is knock on Grandma’s door and tell her they are a contractor who noticed the roof is missing tiles and the next rain is going to cause major damage. Or, maybe it’s a wire exposed outside that shouldn’t be there. This wire will cause a major electrical fire if not fixed immediately.
In both of these incidents, the criminal wants an immediate down payment of a large sum before they will do the work to fix the problem. Once they receive the money, they disappear and never come back to do the work.
While this article talks about cash disappearing from Grandma’s account, other articles from her house also can disappear such as jewelry, collectibles, family memories and legal documents. These items can be taken by any of people mentioned above.
If you see Grandma in any of these situations, tread softly. While you might see it as a case of elder financial abuse, she might see it differently. She may be dependent on the relationship and afraid to lose the person that has been “taking care” of her. Grandma could consider your actions “making trouble” instead of trying to help.
Consider visiting with a professional such as a private fiduciary, CPA or an attorney to discuss possible solutions to the problem. In severe cases, especially where there might be potential physical abuse along with financial abuse, call the police or Adult Protective Services.
The best way to protect Grandma is to keep connected with her and see her or call her on a regular basis. That way you can pick up the “clues” that something wrong is going on.
By MARCIA CAMPBELL | Contributing columnist with THE PRESS ENTERPRISE
PUBLISHED: June 8, 2018 | UPDATED: July 25, 2018
Marcia L. Campbell has worked as a CPA for over 25 years specializing in seniors, trusts, estates, court accountings and probate litigation support. You can reach her at Marcia@MCampbellCPA.com