According to “Crimes of Occasion, Desperation, and Predation Against America’s Elders,” a recent report from the MetLife Mature Market Institute, in collaboration with the National Committee for the Prevention of Elder Abuse (NCPEA) and the Center for Gerontology at Virginia Tech, financial abuse of elderly Americans has risen 12 percent in just the last three years. Older Americans are now estimated to lose $2.9 billion every year. The release of the study coincided World Elder Abuse Awareness Day, a worldwide effort to bring attention to elder abuse and neglect that takes place annually on June 15.
MetLife conducted the study by analyzing news articles about financial abuse of the elderly and extrapolating data from the findings. Among the frightening findings is that women between the ages of 80 and 89 who live alone and require some type of mobility or other daily living aids or assistance are the most targeted victims of financial abuse in the United States, and that 60 percent of crimes against the elderly were perpetrated by men between the ages of 30 and 59.
Here are some of the statistics:
- 51 percent of all instances of financial abuse of the elderly are crimes against seniors committed by strangers
- 28 percent of all financial abuses are crimes classified as scams committed by strangers
- 34 percent of crimes are perpetrated by family, friends or acquaintances (a decrease from about 55 percent in 2008)
- 12 percent are business-related exploits
- 4 percent are Medicare and Medicaid fraud
The study found that most of the crimes involved strangers who exploited seniors with visible weaknesses, like using a cane, having a handicapped tag hanging in their car or showing obvious signs of confusion. Most often, these were the circumstances surrounding physical assaults, purse snatchings or cons.
When family or friends were involved in elderly abuse, the study found that most cases involved forged checks, stolen credit cards, drained bank accounts and transferred assets. To read the entire report, go to http://www.metlife.com/assets/cao/mmi/publications/studies/2011/mmi-elder-financial-abuse.pdf
Taking Steps: Resources To Safeguard Savings
Though a relatively small percentage of these crimes involve fraudulent investment schemes, serious amounts of money are lost by seniors who fall prey to them. How can older investors protect their nest eggs from investment fraudsters? If you have parents or grandparents who are at or near retirement age, have you talked to them about the danger of financial swindles? What do older investors need to know in general about spotting and avoiding investment fraud?
The nonprofit Alliance for Investor Education (AIE) recently compiled 10 of the best Web-based resources for older investors and their family members about how to spot and protect themselves from investment fraud. The Alliance’s new “Older Americans & Investment Fraud: Protecting Yourself, Protecting Your Loved Ones” is available at www.investoreducation.org/elderinvestmentfraud. AIE is the organization of the United States’ leading financial-related foundations, nonprofit organizations, associations and governmental agencies.
Alliance for Investor Education President Sue Duncan, who also serves as vice president of the ICI Education Foundation (ICIEF) at the Investment Company Institute, said: “With the Baby Boomer generation just starting to retire, having saved and invested for years, scammers are looking for ways to take advantage of those nest eggs. The Alliance for Investor Education wants to make sure older Americans can spot red flags when investing. Family members also need to be aware that their parents and older relatives may be at higher risk of being taken advantage of by fraudsters and should know how to protect their loved ones.”
The new “Older Americans and Investment Fraud" section of the AIE Web site features these following 10 top resources for consumers:
- 1. Caring for Loved Ones: http://bit.ly/kpVMWJ, Securities and Exchange Commission.
- 2. My Retirement Paycheck: http://bit.ly/ihgsIk, National Endowment for Financial Education.
- 3. Fighting Fraud 101: Smart Tips for Older Investors: http://bit.ly/mobN4s, Financial Industry Regulatory Authority/FINRA Foundation.
- 4. Elder Investment Fraud and Financial Exploitation Prevention Program: http://bit.ly/je6Kcx, Investor Protection Trust.
- 5. Family and Finances: Start the Dialogue: http://bit.ly/lOR7OY, American Association of Individual Investors.
- 6. Important Questions to Ask Aging Parents: http://bit.ly/kTMoVQ, 360 Degrees of Financial Literacy/American Institute of Certified Public Accountants.
- 7. Senior Investor Resource Center: http://bit.ly/mBXS2F, North American Securities Administrators Association.
- 8. Consumer Guide to Financial Self-Defense: http://bit.ly/jSjVMc, CFP Board.
- 9. 10 Ways To Avoid Investment Fraud: http://bit.ly/jQREfy, CFA Institute.
- 10. Watch Out For These Warning Signs of Fraud: http://bit.ly/k84aKW, Commodities Futures Trading Commission.
To learn more: For an overview of the rest of the best investor education resources on the Web from AIE members, go to http://www.investoreducation.org.