Elder Mistreatment Abuse, Neglect, and Exploitation in an Aging America (2003) / Chapter Skim
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13. Financial Abuse of the Elderly in Domestic Settings
13. Financial Abuse of the Elderly in Domestic Settings
Pages 382-445
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From page 382... ...
Unfortunately, these differences are often overlooked. Little empirical research has been conducted that directly addresses financial abuse of the elderly, and in general it has received less attention than other forms of elder abuse (Nerenberg, 2000b)
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From page 383... ...
Only in the past few decades, however, has it been recognized as a major societal problem. Attention to elder abuse followed the "discovery" of child abuse in the 1960s and spouse abuse in the 1970s.
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From page 384... ...
However, research directly substantiating this assertion is lacking.6 Another dichotomy frequently used distinguishes between elder abuse by individuals who have a special relationship with the elder person (e.g., spouses, children, other relatives, friends, or caregivers providing services within the 4These variations include whether elder abuse is addressed as a separate category or whether it is grouped with the abuse of adults with a disability of any age, the age cutoff used to define an elder person, the definitions of various types of abuse, and whether elder abuse encompasses self-neglect or sexual abuse (Dessin, 2000; Lachs and Pillemer, 1995; Mehta, 2000)
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From page 385... ...
Nonetheless, financial abuse is increasingly viewed as both sufficiently important to necessitate its inclusion in studies of elder abuse in general and sufficiently distinct to justify addressing it separately (Choi and Mayer, 2000~. PARAMETERS OF FINANCIAL ABUSE OF THE ELDERLY The remainder of this report focuses on financial abuse of the elderly within a domestic setting by individuals relatively well known to the elder person.
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From page 386... ...
Forty-eight states and the District of Columbia are reported to specifically mention financial abuse in their elder abuse statutes (Roby and Sullivan, 2000; Wither and Reynolds, 1996~.~° States' definitions, however, vary widely on what constitutes financial abuse and who can be held accountable for it (Roby and Sullivan, 2000; Sanchez, 1996~. One complicating factor is variations in the class of individuals targeted for protection from financial abuse.
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From page 387... ...
Further complicating efforts to establish the parameters of financial abuse of the elderly are that both the elder person and the perpetrator may feel that the perpetrator has some entitlement to the elder person's assets (Dessin, 2000~. Elder persons may feel a desire to benefit their heirs or to compensate those who provide them with care, affection, or attention (Dessin, 2000; Langan and Means, 1996~.
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From page 388... ...
, and it has been argued that a failure to take into account these differences undercuts efforts to assess financial abuse of the elderly (Sanchez, 1996~.12 TYPES OF FINANCIAL ABUSE OF THE ELDERLY In efforts to address financial abuse of the elderly, advocates for the elderly often delineate typical examples of this abuse.13 Examples specifically relevant to a domestic setting and financial abuse by individuals relatively well known to the elder person include: . taking, misusing, or using without knowledge or permission money or property (Dessin, 2000; National Center on Elder Abuse, 2001; National Clearinghouse on Family Violence, 2001; National Committee for the Prevention of Elder Abuse, 2001~; · forging or forcing an elder person's signature (National Center on Elder Abuse, 2001; National Clearinghouse on Family Violence, 2001; National Committee for the Prevention of Elder Abuse, 2001~; · abusing joint signature authority on a bank account (Rush and Lank, 2000~; 12At the same time, the law places considerable weight on the importance of establishing requisite standards of behavior that are uniform, consistent, and predictable across groups of individuals.
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From page 389... ...
negligently mishandling assets, including misuse by a fiduciary or caregiver (Dessin, 2000~; . promising long-term or lifelong care in exchange for money or property and not following through on the promise (National Committee for the Prevention of Elder Abuse, 2001~; · overcharging for or not delivering caregiving services (Central California Legal Services, 2001~; and · denying elder persons access to their money or preventing them from controlling their assets (National Clearinghouse on Family Violence, 2001; Smith, 1999~.
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From page 390... ...
A study of APS reports in upstate New York between 1992 and 1997 that led to state intervention found that financial exploitation was present in 38.4 percent of the cases (Choi and Mayer, 2000~. A study in Massachusetts found that almost one-half of the cases of elder abuse serious enough to require reporting to a district attorney involved financial exploitation (Dessin, 2000~.
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From page 391... ...
It has been asserted that financial abuse often occurs in conjunction with other forms of elder abuse (Choi et al., 1999; National Clearinghouse on Family Violence, 2001; Paris et al., 1995) , although research generally does not establish how frequently this overlap occurs.l7 In a study of one county's investigated APS reports of financial exploitation Choi et al.
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From page 392... ...
For example, one widely cited factor is that elder persons possess a large proportion of the nation's wealth (Central California Legal Services, 2001; National Committee for the Prevention of Elder Abuse, 2001) , with 70 percent of all funds deposited in financial institutions controlled by persons age 65 and older (Dessin, 2000~.
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From page 393... ...
A fourth group of reasons suggests that perpetrators assume that financial abuse of the elderly is unlikely to result in apprehension or repercussions. Perpetrators may believe that elder persons are less likely to report abuse or take action against perpetrators, particularly if they have been victimized by family members or other trusted individuals (Central California Legal Services, 2001; Hwang, 1996; National Committee for the Prevention of Elder Abuse, 2001~.
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From page 394... ...
(National Center on Elder Abuse, 1998~. However, when relying on the reports of their sentinels, which were asserted to be more comprehensive in scope and to include unreported incidents, the NEAIS report concluded that 91.8 percent of the victims of financial abuse of the elderly were women, the highest percentage for any form of elder abuse (the next highest proportion was 83.2 percent for physical abuse)
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From page 395... ...
Physical or mental disabilities of elder persons have also been identified as risk factors, including medical problems that limit their ability to understand and comprehend financial issues and impairments that create dependency on others (Bernatz et al., 2001; Choi et al., 1999; Giordano et al., 1992; Hwang, 1996; National Committee for the Prevention of Elder Abuse, 2001; Podnieks, 1992; Tueth, 2000; Wither and Reynolds, 1996~. However, it has been argued that the extent to which older persons are vulnerable to financial abuse is more directly related to the circumstances in
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From page 396... ...
Implausible or evasive explanations by the elder person or the caregiver about the elder person's finances, the elder person's unawareness of or confusion about recently completed financial transactions, or the elder person appearing to be afraid or worried when talking about money may serve as indicators (Carroll, 2001; Central California Legal Services, 2001; National Clearinghouse on Family Violence, 2001; National Committee for the Prevention of Elder Abuse, 2001~. Alternatively, unpaid bills, eviction or foreclosure i8Wilber and Reynolds (1996)
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From page 397... ...
or by sudden heavy traffic in and out of the home (Hwang, 1996~. Another warning signal may be caregivers or family members who express excessive interest in the amount of money being spent on the older person, who ask only financial questions, or who do not allow the elder person to speak (Carroll, 2001; Langan and Means, 1996; National Clearinghouse on Family Violence, 2001; National Com mittee for the Prevention of Elder Abuse, 2001; Tueth, 2000~.
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From page 398... ...
, or frequent transfers or ATM withdrawals (Coker and Little, 1997; Commonwealth of Massachusetts, 2001; Henningsen, 2001; Hwang, 1996; National Center on Elder Abuse, 2001; National Clearinghouse on Family Violence, 2001; National Committee for the Prevention of Elder Abuse, 2001~. Other indicators include having bank statements and canceled checks sent to an address that is not the elder person's residence, suspicious signatures on checks or other documents, and the inclusion of additional names on an elder person's credit card or bank signature card (Coker and Little, 1997; National Center on Elder Abuse, 2001; National Clearinghouse on Family Violence, 2001; National Committee for the Prevention of Elder Abuse, 2001; Zimka, 1997~.
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From page 399... ...
Another signal can be the sudden appearance of previously uninvolved relatives claiming rights to an elder person's affairs and possessions (National Center on Elder Abuse, 2001~. A fourth cluster of signals is associated with visits to physicians or other health care providers.
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From page 400... ...
Because of a prior negative relationship with the elder person, the perpetrator may fee! a sense of entitlement to these resources as payback for prior exploitation or abuse (Dessin, 2000; National Committee for the Prevention of Elder Abuse, 2001~.
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From page 401... ...
This study also found, however, that nonrelatives were the perpetrators in 38.8 percent of the financial exploitation cases in contrast to only 14.7 percent of all other elder abuse cases (Choi and Mayer, 2000~. Another report concluded that perpetrators are often relatives, particularly children or grandchildren of the victim, many of whom depend on the elderly victim for housing or other assistance, have substance abuse problems, and are represented almost equally by both genders (Coker and Little, 1997~.
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From page 402... ...
The rising awareness of child abuse in the 1960s and that of spouse abuse in the 1970s have been cited as triggering societal awareness of the existence of elder abuse (Dessin, 2000~.21 Preventive measures, reporting systems, and interventions designed to curtail child abuse frequently provided a mode! for efforts to address elder abuse (Capezuti et al., 1997; Gilbert, 1986; Kapp, 1995; Macolini, 1995; Nerenberg, 2000a; Wolf, 2000~.
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From page 403... ...
These contacts result in individuals outside the home frequently being aware of a child's health and well-being and being in a position to detect and report abuse. For many elder persons, such outside contacts may be sporadic and infrequent, which in turn reduces the likelihood that elder abuse will be detected and reported.
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From page 404... ...
As a result, many elder persons will actively 23It has been argued that 1 of 3 cases of child abuse is reported compared to 1 in 5 or 1 in 15 cases of elder abuse (Rosenblatt et al., 1996)
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From page 405... ...
reported that 6 states and the District of Columbia require the consent of the elder person before commencing an investigation of a report of elder abuse and that 29 states and the District of Columbia specifically require the consent of the elder person before services can be provided. See also Shiferaw et al.
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From page 406... ...
Elder persons may justifiably resent the imposition of a paternalistic mode! that appears to presume their lack of capacity, imposes supervision of their decisions, and seeks to make financial decisions on their behalf or delegate their decision-making authority to others (Kapp, 1995~.
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From page 407... ...
(similar to that used for child abuse) might be applied to elder persons for whom a determination can be made that there is a lack of financial decision-making capacity.
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From page 408... ...
argue that shifting from an underlying child abuse model to a spouse abuse model would (1) better inform service providers about situations in which elder abuse is likely to occur, (2)
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From page 409... ...
They argued that an elder person is most likely to be abused by the individual with whom the elder person lives. They reasoned that the higher proportion of elder abuse committed by spouses reflected the fact that many more elders live with their spouses than with their children.
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From page 410... ...
should also attend to the potential influence of factors typically associated with spouse abuse models such as the impact of power and control on financial abuse, victims' incorporation of internalized messages that they are to blame for this abuse, victims' fear of retaliation if they disclose their abuse, and social contexts that may lead an elder person to fear disruption of the status quo (Vinton, 1999~. REPORTING STATUTES Forty-four states and the District of Columbia have enacted statutes that mandate the reporting of elder abuse by certain individuals, with the other states providing for the voluntary reporting of such abuse (Stiegel, personal communication, October 2001~.34 Although virtually all states specifically mention financial abuse in their reporting statutes (Moskowitz, 1998b; Roby and Sullivan, 2000)
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From page 411... ...
It the agency that received the report is not a law enforcement agency, it will turn the matter over to a criminal justice agency if it determines that a crime might have been committed, although some states require that a competent victim give permission to proceed (Henningsen, 2001; Roby and Sullivan, 2000~. In 35But see Wisconsin where investigations of reports of material financial abuse must begin within five business days, while investigations of other forms of elder abuse must begin with 24 hours (Henningsen, 2001)
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From page 412... ...
Choi and Mayer (2000) in a subsequent analysis determined that only 1.4 percent of the reports of elder abuse came from the victims, a figure that did not significantly vary when the focus was only financial exploitation cases.
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From page 413... ...
The U.S. General Accounting Office did not specifically address financial abuse, but it did include "material or financial exploitation" within its definition of elder abuse (U.S.
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From page 414... ...
As noted, victims are relatively unlikely to report financial abuse (Choi and Mayer, 2000; Kleinschmidt, 1997; National Center on Elder Abuse, 1998; Podnieks, 1992) , reportedly more so than for other forms of elder abuse (Podnieks, 1992~.
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From page 415... ...
It is also widely considered difficult for outsiders to detect financial abuse and thus to discern a need for such a report (Choi et al., 1999; National Center on Elder Abuse, 1998~.
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From page 416... ...
(Tueth, 2000~. Reliability of Reports At the same time, studies have indicated that a relatively high percentage of elder abuse reports in general and reports of financial abuse of the elderly in particular are not substantiated following investigation (i.e., they 39This may be the case for emergency rooms.
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From page 417... ...
As discussed, elder persons often refuse to cooperate with investigations triggered by reports of elder abuse or refuse offered services (Dessin, 2000; Kleinschmidt, 1997; Gilbert, 1986; Shiferaw et al., 1994) , with one possible explanation being that they do not agree that what occurred was abuse.42 Financial disputes, particularly among family members, tend to involve complicated interactions in which there may be conflicting perspectives on the appropriateness of the actions taken.
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From page 418... ...
Administrative/APS Agencies All states have adopted some form of adult protective services law that enables state agencies to offer remedies to victims of elder abuse (AARP, 2001) and each state generally has an APS agency designed to prevent and address problems the elderly may face (Dessin, 2000~.44 These agencies focus on maintaining a system for receiving reports of mistreatment, investigating cases, and providing protection or assistance to the elder person rather than punishing the perpetrator (Moskowitz, 1998b; Otto, 2000; Roby and Sullivan, 2000~.
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From page 419... ...
Some states have fiduciary abuse specialist teams (FASTs) , which consist of an interdisciplinary group of representatives from law enforcement, adult protective services, the office of the public guardian, the prosecutor's office, health and mental health providers, and expert financial and legal consultants to help victims recover or to prevent further loss of their assets (Bernatz et al., 2001; Heisler, 2000~.45 Of those programs that have been established to assist victims of financial crimes, little systematic evaluation has been conducted of their availability, impact, or effectiveness.
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From page 420... ...
Criminal Investigations and Prosecutions Following a report of elder abuse, a local APS agency generally conducts an investigation and if criminal behavior is suspected refers the matter to a local prosecutor's office, which will typically undertake an investigation of its own. Alternatively, a law enforcement agency that has received a report of elder abuse may also conduct an investigation and subsequently refer the matter for prosecution.
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From page 421... ...
Alternatively, it can be difficult to determine whether the elder person was the victim of unfair persuasion or coercion (Central California Legal Services, 2001~. As one commentator has noted, "in a relationship in which one person is likely to want to give and the other is likely to fee!
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From page 422... ...
In addition, most police and prosecutors' offices lack adequate resources for handling complex financial crimes. Advocates for the elderly argue that federal agencies should assist the states in prosecuting elder abuse (AARP, 2001~.
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From page 423... ...
It has been asserted, however, that most litigators ignored this act until a relatively recent opinion by the California Supreme Court established that considerable financial exposure can result from elder abuse (Delaney v Baker, 971 P.2d 986 (Ca. 1999~; Mehta, 2000~.
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From page 424... ...
. If attorneys' fees are not available from the perpetrator, the misappropriated property may represent the elder person's life savings but still represent a relatively small sum in comparison to the attorneys' fees and the costs of litigation (Moskowitz, 1998b)
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From page 425... ...
Both mentally competent persons and persons with diminished mental capacity can be unduly influenced (Nerenberg, 2000c; Quinn, 2000~. Elder persons have been identified as being vulnerable to undue influence when there is a close relationship in which the abuser is trusted and the elder person either suffers from cognitive impairments, is socially isolated, or is in a major life transition, such as widowhood (Quinn, 2000~.
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From page 426... ...
It has been noted that few states require any type of registration by an agent, there are no mechanisms to ensure the principal has mental capacity at the time of signing or has not been coerced into signing, elders may not realize the extent of the authority they are 49For a discussion of civil remedies available when a perpetrator has occupied a fiduciary status in general, see Moskowitz (1998b)
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From page 427... ...
~ardian/Conservator Perhaps the most drastic step that can be taken in response to financial abuse of an elder person is the appointment of a guardian (alternatively referred to as a conservator or a committee in some states) to make financial decisions for an elder person.
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From page 428... ...
For example, the costs of establishing and administering a guardianship can pose a significant drain on an elder person's resources (Nerenberg, 2000c) and it can be relatively complex and intrusive.53 Also, individuals seeking establishment of a guardianship for an elderly person may be acting in their own interests rather than attempting to assist an elderly person in need (Heisler and Quinn, 1995~.
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From page 429... ...
PREVENTIVE MEASURES Because investigating and proving financial abuse is often difficult and because perpetrators often spend or dissipate assets before abuse is discovered, preventive measures are the preferred means for addressing financial abuse of the elderly (Central California Legal Services, 2001~.54 A number 54Addressing elder abuse in general, a report of the U.S. General Accounting Office concluded that creating a high level of public and professional awareness of elder abuse was the most effective means for redressing elder abuse, more so than either mandatory or voluntary reporting laws (U.S.
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From page 430... ...
Arrangements might also be made that any effort to expand the number of individuals with access to an elder person's bank account result in the notification or require the consent of a third party (National Clearinghouse on Family Violence, 2001)
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From page 431... ...
Similarly, steps can be taken to revoke a power of attorney and to request an accounting (Central California Legal Services, 2001; National Clearinghouse on Family Violence, 2001~. The Social Security Administration, the Veteran's Administration, or a pension board can be notified of the possible theft of benefit or annuity checks, of a new representative payee, or of new arrangements for direct deposit or delivery of checks (Central California Legal Services, 2001~.
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From page 432... ...
. 57The banking industry has been reported to believe that statutes encouraging the voluntary reporting of elder abuse do not adequately shield financial institutions from liability (Tom, 2001)
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From page 433... ...
Another avenue is to encourage attorneys to ensure that older persons who financial institutions to contact government entities and disclose otherwise private customer records and information concerning suspected violations of the law and that this would encompass elder abuse reports (U.S. Congress, 2000)
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From page 434... ...
Although advance planning regarding financial affairs and the execution of a financial advance directive may be undertaken in an effort to avoid subsequent financial abuse, such efforts have been undercut when the elder person's designated agent engages in financial abuse (Kapp, 1995~. A number of steps have been identified to minimize the likelihood of financial abuse by fiduciaries.
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From page 435... ...
Health care providers who see their elderly patients regularly may be in the best position to know if an older person's mental capabilities have declined to such an extent that the individual is subject to financial abuse (Smith, 1999~.6° It has been suggested, for example, that nurses in the community and in clinics are likely to encounter elder persons at risk and can assess the level of social support available, provide education on how to avoid financial exploitation, and make appropriate referrals to volunteer companion programs and the like (Lavrisha, 1997~. In addition, it has been argued that nurses have an ethical and often a legal responsibility to recognize and detect potential financial mistreatment and that gerontological nurses in particular can encourage the initiation of appropriate responses to financial abuse such as the establishment of a representative payee, a durable power of attorney, a trust, or a joint tenancy (Weller, 1989~.
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From page 436... ...
Alternatively, assessment instruments for detecting elder abuse, which include signals of financial abuse, have been developed for caseworkers visiting elders in the community (Reis, 2000; Sengstock and Hwalek,1986~. However, one survey found little enthusiasm for involving social services agencies in these surveillance efforts, with caseworkers stressing that sorting out financial affairs was complex and time-consuming (Langan and Means, 1996~.
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From page 437... ...
Even less is known about victims' mental health or social service needs and effective approaches to addressing them (2000c:70~. In contrast, the NEAIS report (National Center on Elder Abuse, 1998)
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From page 438... ...
In a world of limited resources, does financial abuse justify the same level of scrutiny or intervention as do other forms of elder abuse? What other forms of elder abuse co-occur with financial abuse and to what extent?
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From page 439... ...
In Understanding Elder Abuse in Minority Populations, T Tatara, ed.
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From page 440... ...
Mayer 1999 Financial exploitation of elders: Analysis of risk factors based on county adult protective services data. Journal of Elder Abuse and Neglect 10(3/4)
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From page 441... ...
Carlson 1999 Elder abuse: Its meaning to Caucasians, African Americans, and Native Americans. In Understanding Elder Abuse in Minority Populations, T
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From page 442... ...
In Understanding Elder Abuse in Minority Populations, T Tatara, ed.
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From page 443... ...
I7tml . National Committee for the Prevention of Elder Abuse (NCPEA)
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From page 444... ...
Sampson, D 1996 Annotated Bibliography: Elder Abuse Financial Exploitation by a Conservator.
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From page 445... ...
U.S. General Accounting Office 1991 Elder Abuse: Effectiveness of Reporting Laws and OtI7er Factors.
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