Elders and caregivers should be aware of what it is, loss potential, and how to avoid it
Elder fraud comes in many forms — from a caller offering a sweet deal with the promise of grant money for a small processing fee, to a person writing checks off someone’s account after obtaining power of attorney.
Anyone can be duped, but elders tend to be targets, because they are quite often more trusting and financially secure. They are less likely to report a crime because of embarrassment they feel after having been tricked. Often, allegedly trustworthy people are the perpetrators of the fraudulent activities.
“Elder exploitation has often been called a ‘silent crisis’ because victims are either ashamed, see little chance for recourse or are reluctant to file complaints or prosecute when they discover the suspect is someone close to them. According to the National Center on Elder Abuse, a study of 4,156 elderly exploitation cases found that 58 percent of perpetrators were family members, followed closely by friends, neighbors and home-care providers,” Bart Pfankuch reported in his 2018 article for South Dakota News Watch, “South Dakota a national leader in battling elder fraud,” which was released for publication May 1, 2018.
The problem of elder fraud is pervasive and nationwide. In a compilation of data released this past March, a company called Comparitech estimates that “5 million cases of elder fraud occur in the US annually resulting in $27.4 billion in losses.”
The FBI reports that in coordinated efforts from 2017 – 2018, “criminal cases against more than 260 defendants who victimized more than 2 million Americans, most of them elderly” were presented with losses estimated to have exceeded more than $700 million.
“Elder fraud, also called elder financial abuse or elder financial exploitation, is defined as the misappropriation or abuse of financial control in a relationship where there is an expectation of trust, resulting in harm to the elderly victim,” wrote Paul Bischoff, tech journalist, privacy advocate and VPN expert in the report, “The United States of Elder Fraud – How Prevalent is Elder Financial Abuse in Each State?”
In 2018, South Dakota was deemed to be at the forefront of addressing elder fraud in the nation, Pfankuch reported.
The then Assistant Attorney General Michael Sharp was appointed to be “the statewide prosecutor who worked solely on financial crimes against the elderly” for the Elder Justice Unit, Pfankuch wrote.
On the SD Attorney General’s current website under newly elected Jason Ravsnborg, the Department of Human Service, Division of Long Term Services and Supports through Dakota at Home and the Attorney General’s Medicaid Fraud Control Unit are listed as departments that can be contacted to report elder fraud under its elder abuse tab, but there is no indication that the Elder Justice Unit is still in existence.
The Elder Fraud Unit was established in July 2016, and as of May 2018, the team had “received 790 complaints and landed 10 convictions.”
In each report, officials indicate that while losses are estimated in the millions there are many instances that go unreported or once filed, are difficult to prosecute.
According to Comparitech, “21 percent of South Dakota seniors are estimated to have lost a total of $165 million in the last year” — about 42,000 cases in total, according to the information Comparatech gathered from SD criminal stats.
“Of the 1,711 against victims aged 60+, according to state crime stats, larceny leads the way (49.21%), followed by impersonation (14.14%), intimidation (8.65%), false pretenses (8.01%), and counterfeiting/forgery (6.90%)” Bischoff reports.
In the US, South Dakota ranks among the highest in the percentage of people who fall victim to elder fraud. Minnesota, Nevada, Tennessee and Virginia are also have high percentages.
Florida, Arizona, California, Texas, and Georgia are top in elder fraud based on total losses.
People are encouraged to report suspected fraud abuse by either “reporting fraud to the FBI’s IC3, the Federal Trade Commission, or local or state authorities.”
The FBI, Comparitech and the South Dakota websites all suggest that to avoid fraud, elders, caregivers, and family members should take the following precautions.
The following list comes from the Comparitech study on their website, www.comparitech.com/blog/vpn-privacy/elder-fraud-by-state/:
• Plan ahead to ensure your assets are fully protected and your wishes will be followed. You might want to talk to a financial advisor or an attorney to find the best options for you.
• Always shred bank statements and receipts as well as unused credit cards before you throw them away.
• Never discuss your financial information with anyone you don’t know or trust. This includes giving someone your bank details, Social Security Number, and any other financial information over the phone.
• Order a copy of your credit report every year to make sure it’s accurate and that there aren’t any accounts on there that you don’t recognize. You could also sign up for identity theft protection so professionals are constantly monitoring your accounts for suspicious activities.
• Thoroughly check credentials and references before you hire anyone and don’t give workers access to your financial information. For example, you may want to lock up your account statements, checkbook, and other sensitive documents while others are in your home.
• Look out for charity fraud hoaxes by doing thorough research into the charity, not responding to solicitations for donations, not sending any of your bank details or mailing cash, and discussing the charity with your friends and family first.
• Never pay taxes or fees to collect lottery “winnings” or sweepstakes.
• Pay for things using your debit or credit card so you have a paper trail of all the transactions you’ve made.
• Trust your gut. If something doesn’t feel right – tell someone. And if you do feel threatened or intimidated (or you’re concerned for an elderly person you know), contact your local Adult Protective Service.
• Finally, don’t be afraid to say “no.” This is your money and you’re entitled to say how you want to use it.