It’s disheartening to think your loyal, older credit union members could be victims of financial abuse. Unfortunately, a perpetrator illegally or improperly using an older adult’s funds, property, or assets occurs more often than you’d suspect.
And this problem will grow.
As of 2010, the U.S. included more than 40 million Americans age 65 and older, representing 13% of the population. That’s the most in that age group than at any point in the history of the U.S. census.
Thanks to advances in medicine and lifestyle—and the graying of the Baby Boomers—this demographic might represent as much as 20% of the population by 2050, when 19 million people will be age 85 or older.
Financial exploitation is the most common form of elder abuse. Older adults generally have amassed significant assets or equity in their homes and often are vulnerable due to isolation, cognitive decline, health problems, disability, and/or the recent loss of a partner, family member, or friend.
Who commits these ignoble acts? A range of people, including family members, caregivers, scam artists, financial advisers, home repair contractors, and fiduciaries (such as agents under power of attorney and guardians).
The good news is that because you have built relationships with these members, you can recognize and prevent signs of elder abuse by detecting irregular transactions, account activity, and behavior.
A Financial Crimes Enforcement Network (FinCEN) Advisory, issued in 2011, explains two potential indicators and red flags of elder financial exploitation:
1. Erratic or unusual banking transactions, or changes in banking patterns:
2. Interactions with members/caregivers:
FinCEN advises credit unions to evaluate these indicators in tandem with other red flags and customary transaction activity. If the credit union knows, suspects, or
has reason to suspect that a member’s transaction is atypical, and the credit union knows of no reasonable explanation for the transaction after examining the available facts, the credit union should file a Suspicious Activity Report.
Your credit union also should follow state and local laws and regulations to report all forms of elder abuse. Prompt reporting of suspected elder financial exploitation can trigger appropriate intervention and prevent financial losses.
This article first appeared in Credit Union Front Line newsletter, the monthly sales and service newsletter for branch staff and their managers. Subscribe now to the print edition or PDF version.