Here is a great article about elderly becoming targets for financial fraud. It was written by Pamela MacLean from the San Jose Mercury News.
Nancy Wright first noticed her father experiencing memory problems on a family vacation two years ago. The then-75-year-old retired IBM engineer from San Jose had misplaced his wallet with $1,500 inside.
"Dad had never done anything like that before," says Wright (who requested use of a pseudonym to protect her family's privacy). "The whole vacation he kept getting lost," she says. Wright wrote off his behavior to stress over her mother's health conditions and her dad's concern over those medical expenses.
Toward the end of 2009, family members were hearing Wright's father -- let's call him Gary Davidson -- talking several times on the phone about an investment he was making to create an online business.
By April 2010, the family decided it was necessary to intervene in his financial affairs. They soon discovered Davidson apparently had been swindled out of nearly $100,000 by phony companies promising to set up Internet sites on which he could conduct business.
Situations like Davidson's have become increasingly common. Financial exploitation of the elderly by commercial predators -- and sometimes by caregivers, neighbors or even family members -- has become a growth industry, estimated at $2.9 billion annually in the United States, according to a study released in June by MetLife. That's up 12 percent over findings from a similar MetLife study in 2008.
Financial abuse of seniors is expected to mushroom in coming years, says Shawna Reeves, director of financial education for the Silicon Valley Council on Aging. The number of people 65 and older in the U.S. will double by 2030 to 71 million, according to federal statistics.
In Santa Clara County alone, 563 reports of financial abuse of people over 65 were filed in 2010, according to Lee Pullen, director of the county's Aging and Adult Services Department (which also received some 2,100 reports of physical abuse or neglect last year for the same age group). The vast majority of those are resolved by replacing a dishonest caregiver or arranging for family members to co-sign checks, Pullen says. Criminal charges are rare, he says.
Still, the losses can be devastating not just to the immediate victim but to his or her entire family. Wright, who is 49 and has grown children, was forced to set aside her career plans to take over her father's finances. After piecing together bits of information, Wright says, the family found that immediately after one of the companies had received Davidson's first check, scammers apparently used his account information to make other fraudulent payments via electronic checks.
Overall, his credit union cashed 20 electronic checks allegedly created by scammers before the credit union reported unusual account activity to authorities, according to Wright. Her father also gave telemarketers credit card information, and some ran up fraudulent charges there, too, she says.
"I just felt kind of helpless," Wright continues. "It was awkward taking over his finances. He really believed he was doing good business transactions."
Later in 2010, the family had to move Davidson from his home to an assisted living residence. Now it is trying to sell his house, despite reverse mortgages on it, to pay for his care and the care of his wife, who is living in the same residence. Efforts by Wright's brother to track down the 15 companies and individuals who apparently cashed the electronic checks have been unsuccessful.
"These are complicated cases," says Janet Berry, a deputy district attorney for Santa Clara County's elder financial abuse unit, created in 1990. She declines to discuss the Davidson case specifically but did contact Wright in mid-July to explore the fraud allegations, the family confirms.
Prosecuting fraud aimed at the elderly is tough because such cases are often document-intensive, and they require the legal system to move quickly because of the victim's age, Berry says. In addition, families may be reluctant even to report fraud in the first place out of embarrassment or fear. To block efforts at recovering stolen funds, predators often locate offshore in the Caribbean, Europe or Canada -- which puts them largely out of reach of U.S. law enforcement, Berry says.
Despite such obstacles, the legal system is making some adjustments to help victims. In 2008, former Alameda County Superior Court Judge Julie Conger started running California's first elder court, which focuses on cases involving older victims of financial, physical or emotional abuse.
Contra Costa County quickly followed suit, expanding its services to include probate cases and family mediators, as well as civil and criminal cases.
Judge Joyce Cram presides over the Contra Costa County elder court in Martinez every Tuesday. "We consider it an amazing success," she says. The accommodations made in this court include cranking up the audio level, providing hearing devices to those who need them, displaying documents on large screens and convening court during the morning hours.
Cram explains that one critical factor for success has been finding ways to conclude related civil and criminal financial fraud cases simultaneously, in order to get restitution in the hands of older adults quickly and to cut down the number of court appearances.
However, before a prosecutor can get involved in a case, the victim or his family needs to assemble records showing probable abuse.
Wright says she and other family members have spent months trying to untangle the maze of banking and credit card records involving several firms, including one in Arizona and another in Southern California. In February, Davidson's family hired Nancy Norris of Norris Fiduciary Services in San Jose, which specializes in work for the elderly. Reached by phone, Norris says she charges by the hour for her services but declines to discuss her rates, for publication. She has helped Davidson's family pull together a detailed accounting for the district attorney and for filing a complaint with Davidson's bank, Meriwest Credit Union.
"Meriwest ... honored $53,900 worth of electronic checks with no signatures," Norris says. "That's where the bank was at fault," she alleges. The other $46,000 was lost in credit card transactions and money Davidson transferred on his own.
According to Barry Roach, a Meriwest spokesman in San Jose, the bank has written to the family in response to its complaint, but he says he cannot comment further on the Davidson case. He adds that any request for restitution in such a situation must be addressed to the banks that deposited the funds. In the case of electronic transactions, Roach continues, "the burden is on the customer to come back to us" over unauthorized checks. He says Meriwest's policy is to contact Adult Protective Services the same day it spots a suspicious check or bank draft.
State law requires banks, credit unions and other responsible fiduciaries to report suspected financial abuse to Adult Protective Services, says Mark Gonzalez, deputy lead county counsel in San Jose and a member of the county's elder financial abuse unit.
After receiving Meriwest's report of unusual activity, Santa Clara County's Adult Protective Services unit made three attempts to visit Davidson. But they were rebuffed by Davidson, who was fearful of government agents at his door, Wright says.
Though Wright hasn't given up hope that the family can recover a portion of his life savings, she says, "I wish I'd gotten involved sooner."
Had the irregular account activity been discovered earlier, it is possible a multi- agency task force could have been deployed. Like many California counties, Santa Clara County has created a Financial Abuse Specialist Team (FAST), which brings together several agencies to jump on possible elder abuse, and stop the money drain. According to Pullen, when an elderly person is being exploited, the Adult Protective Services can refer a FAST team.
But once it is on the case, the process may not be simple. Individual rights can't be usurped unless there is a clear lack of capacity, Pullen says. "They can refuse us at the door. They have a right to make bad decisions."
Unusually large bank or ATM withdrawals by an elderly person who cannot get to the bank
Check signatures that look unusual
Checks written to "cash" and negotiated by an elder's caregiver
Checks signed by a senior but completed by others
Large loans against home equity to pay for investments
New activity in accounts that have been dormant
Expensive gifts from an elder to a caregiver
Check or credit card transactions with telemarketers or direct-mail marketers
Contributions to newly formed causes
Investment in time shares, real estate, annuities or other financial products
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