Civil Rights
Block on Trump's Asylum Ban Upheld by Supreme Court
Even the smartest person can be taken in by a scam. And unfortunately, many con artists prey on elderly persons to steal their money and personal information. One in 10 people aged 60 or older has been the victim of elder abuse, which includes financial abuse and identity theft.
Before his death in 2018, Marvel comic co-creator Stan Lee was the victim of alleged financial abuse. Police charged Lee's manager with fraud, forgery, and false imprisonment of his client. There are also allegations that the manager mismanaged over $5 million of Lee's money and moved Lee out of his home and hired security guards to keep his family away.
If a celebrity can be taken in with all of their money and visibility, how can you protect your aging parents from falling victim to financial exploitation?
First, understand how scammers target seniors and educate your parents about them. Elder financial abuse takes many forms, such as:
Most elder fraud is committed by caregivers and family members in a position of trust or financial advisors or accountants who help with financial decision-making. Essentially, someone who has access to financial accounts or who has undue influence over your parents could be suspect.
Second, offer to help them monitor their bank accounts or emails for suspicious activity or withdrawals. An excellent way to do this is to look at their bank or credit card statements for any errors. You may be able to set up notifications from your bank for low balances or large withdrawals. Also, checking their mail and email will alert you to any red flags or shady dealings.
Third, ask them if they have a power of attorney for their finances and who their agent is. Older adults may have cognitive impairments or physical disabilities; they need to rely on loved ones to help them. A power of attorney allows adult children to monitor their finances and prevent elder financial exploitation.
A financial power of attorney allows you (the "principal") to name someone you trust (the "agent" or "attorney in fact") to handle your financial transactions. The agent has a fiduciary duty to act in your best interests, or they will face criminal charges or lawsuits. This is a separate document from a health care power of attorney.
There are typically three types of financial power of attorney:
A power of attorney is a simple, straightforward document with significant implications. As an agent, you step into the shoes of the principal. So you can borrow money on their behalf, commit them to loans, or sell their property.
There are certain general powers that your parents could grant you to manage their financial resources, such as:
There are certain powers that your parent may or may not want to grant. Those powers allow an agent to reduce the size of the principal's estate. This should only happen for estate tax planning purposes or for your parent to qualify for benefits like Medicaid.
You can help your parent prepare a power of attorney with online forms or contact an elder law or estate planning attorney to prepare one for you. The information you will need for a power of attorney is:
Once the document is ready, your parent will sign the power of attorney before a notary.
Suppose you suspect your parents have been scammed. In that case, you can report elder financial abuse to the federal government's Consumer Financial Protection Bureau or the Adult Protective Service agency in your state. Also, contact their banks, credit card companies, and financial institutions to put a fraud alert on the accounts.
An elder law or estate planning attorney can help you navigate issues caused by financial elder abuse.
Talk to your elderly parents about who has access to their financial information. If they allow it, volunteer to be their power of attorney if they cannot manage their financial life independently or need help with bill paying or financial decisions. It is a valuable tool to protect against elder financial abuse.