Fighting Financial Scams Aimed at Seniors

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Sally Hurme figured that if anyone knew about financial scams targeted at older Americans, it would be her family and friends. After all, Hurme, an attorney and AARP project advisor, had spent two decades educating seniors across the country about fraud and how to avoid it.

That’s why she was so shocked when her own husband, Art, 71, became the victim of a fraud in January. The retired Army Corps of Engineers marine biologist wound up losing $3,000 in an “imposter scam” after receiving a call at his Alexandria, Va., home from a sobbing woman claiming to be his daughter. She told him she had been in a car accident and was under arrest for drunken-driving in California and needed money to get out of jail.

“Art knew about all kinds of scams, but not this one,” Hurme said. “And if it could happen to him, it could happen to anyone.”

State legislators have become increasingly concerned about financial crimes against seniors and vulnerable adults.

“The real innovations are happening at the state level,” said Mary Twomey, co-director of the National Center on Elder Abuse at the University of California, Irvine. “The states are definitely stepping up.”

This year, lawmakers in at least 28 states and the District of Columbia introduced legislation addressing the issue. Some measures focus on enhancing criminal penalties. Others target caregivers who exploit elderly charges. Some require financial institutions to report suspected exploitation.

No one keeps statistics on exactly how many seniors have become victims of financial fraud or exploitation. Often, they don’t report it to authorities out of shame or embarrassment.

But there is growing evidence that the problem is substantial. The Federal Trade Commission’s Consumer Sentinel Network database, which collects consumer complaints and makes them available to law enforcement, contained 123,757 fraud complaints in 2013 from victims who had identified themselves as aged 60 and over.

A 2011 study by MetLife estimated that the annual loss to elderly victims of financial fraud (perpetrated by strangers) and abuse (perpetrated by family, friends or neighbors) was at least $2.9 billion, a 12 percent hike over its 2008 estimate.

And a study released this month in the Journal of General Internal Medicine found that one in 20 older adults in New York state reported that they had been financially exploited, usually by a family member, but sometimes by a friend or home-care aide.

“When you’re an elder and you cannot recoup the money, these financial crimes are devastating to your peace of mind and to your actual health and welfare,” Twomey said. “People often never see that money again. A lot of times the scam artist is in another country. And if it’s a family member who’s committed the financial abuse, the money often has gone (to the offender’s drug or) gambling problem.”




Heather Morton, a legislative analyst for the National Conference of State Legislatures, said financial scams aimed at seniors are “a significant topic for (state) legislators who are looking for ways they can help their constituents.”

Among the measures passed within the past two years:

— In Colorado, a comprehensive senior-protection bill included a provision requiring police to be trained in recognizing exploitation and abuse of at-risk elders. Every sheriff’s department and municipal police agency must employ at least one trained officer by Jan. 1, 2015.

— In Maryland, money transmitters, such as Western Union, must provide training to certain employees on how to recognize and respond to financial exploitation of seniors. The state already requires financial institutions to report such cases to law-enforcement or adult protective services within 24 hours.

— In North Carolina, a 2013 law gives courts authority to freeze the assets of a defendant charged with financial exploitation of a senior or disabled adult, if the victim has lost more than $5,000.

North Carolina Democratic state Rep. Rick Glazier said he sponsored the financial-exploitation bill in his state because many senior victims had no chance at restitution once the money had disappeared.

“People were being ripped off, and by the time you found out who was at fault and charges were brought, the assets were gone,” Glazier said. “You could deal with the scammers criminally, but the victims were left holding the bag. For a lot of senior citizens, losing $5,000 or more can dramatically affect their lives.”