Elder financial abuse remains an underreported and misunderstood issue — one likely to get worse as America's population ages. This abuse often involves the unauthorized or improper use of resources of an elder family member or friend for monetary or personal benefit, profit or gain. Allianz Life Insurance Co. of North America (Allianz) is working to educate financial professionals, the community and employees on how to help prevent abuse. To help determine how the financial services industry can best address this difficult yet preventable problem, Allianz commissioned the 2014 Safeguarding Our Seniors study. The study of more than 2,000 Americans — both potential victims (ages 65+) and their family/friends (ages 40-64) — found that misconceptions persist about the most likely sources of abuse, and the financial impact on victims, though underreported, is often significant. Allianz leveraged the study's insights to create educational materials for financial professionals and helped to build a new community outreach program staffed by Allianz employees. For more information see allianzlife.com/sos.
BY THE NUMBERS
Data from the Allianz Safeguarding Our Seniors study:
$30,000: Average financial loss reported by victims of elder financial abuse.
$100,000: Financial loss reported by more than 10 percent of victims.
23: Percentage of victims who said they had an unauthorized purchase of a product or service.
33: Percentage of victims who said they had funds disappear from accounts.
50: Percentage of family/friends who said they either don't believe or are unsure if their elder would tell someone they experienced financial abuse.
52: Percentage of victims who reported the abuse was originated by a family member, friend or caregiver.
58: Percentage of family/friends who believe they have resources to protect an elder family member.
82: Percentage of elders who said they have resources to protect themselves from EFA.
TIPS FOR PREVENTION
Talk about it. Elder financial abuse is a growing problem because it largely exists in the shadows. Typically, Americans don't talk about their finances with relatives, so this issue has a greater opportunity to grow undercover. People need to break the taboo and facilitate a discussion with their loved ones about finances in order to bring this topic to light.
Stay in touch. The study found that elders who regularly talk to a third-party resource — either family/friends or hired professionals (financial professionals, lawyers and/or accountants) — about their finances feel they are better equipped to identify and prevent elder financial abuse. Family/friends should make this discussion a regular part of their interaction with their elder.
Power in numbers. While elders are wise to discuss their finances with a third party, it's even better to include at least one extra person in the equation to provide a system of checks and balances. Since the majority of elder financial abuse comes from family/friends or caregivers as opposed to strangers, elders can use the extra set of eyes to be more confident that they're getting the right advice, etc.
Recognize the red flags. The perpetrators of elder financial abuse are getting more sophisticated and aggressive with their tactics, so it's crucial that both elders and their family/friends be vigilant in watching for red flags — irregularities in financial accounts, unusual transactions, etc. — but also that they stay informed about current scams. The more awareness people have about the types of fraud targeted at elders, the better prepared they can be to take the appropriate action.
