How to Help Aging Loved Ones Avoid Financial Abuse

Various forms of estate planning can help prevent financial abuse. Advise your elderly loved ones to plan their estates as early as possible. For example, your loved ones can use

• A last will and testament to determine who will inherit their estate
• A financial power of attorney to determine who controls their finances in case of incapacitation
• A healthcare proxy which handles all medical decisions on their behalf in case of incapacitation
• A HIPAA (the Health Insurance Portability and Accountability Act) release form to restrict access to their medical and insurance information

For example, fraudsters sometimes pretend to help elderly persons pay their bills. A financial power of attorney makes such approaches difficult. Ideally, your loved ones should plan their estate before they get too frail. Otherwise, some people might attempt to challenge the estate documents based on mental incapacitation (common in old age).

In addition to estate planning, financial education (for both you and your loved one) can also help avoid abuse. Your elderly loved one should understand:

• All their sources of income
• Their financial obligations
• Their financial goals

Consider an elderly person who isn't aware of how much they should copay for a medical procedure. An abuser can target such a patient and inflate their copayment.

You can also help your elderly loved ones to vet their staff. Elder financial abuse typically comes from those who have close and frequent associations with their victims. Family members, close friends, and staff (such as domestic staff) are potential fraudsters. For example, if your loved one requires a domestic staff or nurse, investigate the person's background first.

Many people need help with different tasks as they age. For example, your elderly loved one may need assistance with settling bills, negotiating purchases, or comparing quotes for services. Unfortunately, some of those who need help the most don't always ask for it. Besides, asking for help from the wrong person can lead to financial abuse.

Offer your assistance to your loved ones so they don't get help from questionable quarters. They might resist your advances at first. Just let your loved ones know that you are available for help. Hopefully, you will be the first person your loved one contacts if they need help.

Despite the precautions above, some criminals may still try to defraud your elderly loved ones. Thus, you should always be on the lookout for red flags that point to financial abuse. Some of the red flags to watch out for include:

• Unexplained large withdrawals
• Unusual signatures on checks
• Changes to estate planning or financial documents
• Unnecessary purchases

You can even help your loved one to track their finances using automated or professional services. Don't let a suspicious activity go uninvestigated. In some cases, an investigation might reveal past cases of fraud.

Financial information can be complex and confusing for some people. The more financial accounts your loved one has, the more they might struggle to keep track of everything. If possible, they should streamline their accounts for more simplicity. A financial professional can ensure your loved one doesn't incur penalties or lose money in the process.

Note that the individual responsible for the theft or mismanagement is not necessarily the only one liable for the abuse. Other parties, such as a nursing home or a staffing agency, might be complicit in the theft. Contact Borbi, Clancy & Patrizi, LLC, if your loved one is a victim of elder financial abuse. We will review the case and file a claim against the relevant parties.