Elder financial abuse: How to protect yourself and your family

Information courtesy of USAA Life Insurance Company and USAA Life Insurance Company of New York.

What is elder financial abuse?

Elder financial abuse is when someone financially exploits an elderly person. For example, a phone scammer tricks a senior citizen into wiring them money, a family member doesn't pay back the money they owe, or a caregiver charges too much for their services.

It's a form of abuse that's on the rise in America. In 2023 alone, there were more than 100,000 complaints of fraud by those over 60 and losses totaling over $3.4 billion, according to the FBI.^{See note1} But those figures only represent the abuses we know about. The real toll could be much higher.

Despite being so common, elder financial abuse is hard to spot because it often happens with the elderly victim's consent. In many cases, they don't know they're victims. And sometimes, they're too embarrassed to admit it.

These are just a few examples of how someone could take advantage of an older adult without drawing much attention.

• A grandchild pesters their grandparent for money.
• A caregiver asks their employer to add them as a co-owner on their accounts or pressures them to sell stocks and turn them into cash.
• A family member asks for access to the victim's bank account to make transactions on their behalf.

They might say, "Since I'm helping you buy your groceries, wouldn't it be so much easier if I could write a check?" Sharing resources like a credit card or bank account opens you up to fraud and theft. This almost always goes unreported and is unfortunately undetectable.

What scammers look for.

One way to help prevent elder abuse is to know when you or someone you love may be at risk. Older adults are generally more at risk when they:

• Financially support an adult child or grandchild.
• Don't have much social support.
• Are grieving a loss.
• Require help with daily tasks.
• Are depressed or sick.
• Have gone through traumatic family events in the past.

Criminals often target older adults because they're more likely to be isolated, dependent on others for help, or have disabilities that make them vulnerable. This can lead to them being defenseless against people who want to take advantage of them.

Tips to protect yourself or your family.

As we age, our ability to manage money is usually one of the first things we struggle with. But getting older doesn't mean you can't manage your assets wisely.

The following are some steps you can take to protect yourself from financial abuse.

• Get trusted family members to help with your financial planning.
• Divide care for investments, property and health decisions among multiple people you trust.
• Check with an attorney or financial professional before signing something you don't understand.
• Build relationships with financial professionals who can help you watch out for suspicious activity.
• Try not to use cash for big purchases. Instead, use checks or credit cards, so there's a paper trail.
• Be cautious when receiving unknown calls. If you feel uneasy about what the caller is saying, you can always ask for their contact information and tell them you'll call back.

The last tip is especially important for avoiding scams. If something appears to be slightly amiss, there's a good chance it is. If you get a call from a number you don't recognize, don't feel like you have to answer. And if you find yourself on the phone with someone suspicious, just say "no" or "let me think about it."

Common scams

It'll be easier to spot a scam with confidence once you know the common ones that fraudsters use to target seniors.

Here are the top five scams currently used by fraudsters, according to a recent report by the U.S. Senate's Special Committee on Aging.^{See note1}

1. Government impersonation scams

Someone calls a senior claiming to be part of a government agency. They might tell the victim they have unpaid taxes and could be arrested if they don't pay them. Or they may say Social Security or Medicare benefits will be cut off unless they act right away.

The scammer usually asks the victim to press a number to connect with someone who can talk with them more. Then they'll try to trick them into providing private information.

2. Sweepstakes and lottery scams

In these scams, fraudsters call older adults and tell them they won the lottery or a new car. Then they try to convince them to wire money for taxes and fees so they can claim their winnings.

3. Robocalls and phone scams

One common robocall scam is the "Can you hear me?" call, according to the National Council on Aging.^{See note1} The scammer calls someone and abruptly asks, "Can you hear me?" When the victim answers "yes," the scammer records their voice and hangs up. Then they'll try to use the recording to access the victim's accounts or authorize charges.

4. Grandparent scams

This is when a scammer convinces an older adult that their grandchild is in trouble and needs money. This happened to my own mother-in-law recently when she was visiting and got a call on her cell phone. The caller told her there had been an accident and her grandson was in jail. They said she needed to wire money for his bail.

5. Computer tech support scams

In these scams, fraudsters claim to be a tech support agent for a well-known company and try to trick the victim into paying for their services. They'll usually ask for the victim's credit card information or access to their online bank account.

Learn more about protecting yourself and reporting suspicious financial activity or fraud by visiting usaa.com/scams.