Elder Financial Abuse: Is Your Senior a Victim?

In August 2019, a 93-year-old Holocaust survivor and her husband lost almost all of their life savings. Their caretaker stole more than $100,000 over nearly a decade. Elder financial abuse destroys the lives of thousands of seniors each year — particularly those in nursing homes who may be unable to care for themselves. Learn how to spot the signs of financial abuse in nursing homes.

What Is Elder Financial Abuse?

Elder financial abuse occurs when someone steals money or assets from a senior citizen. Seniors are especially at risk if they can no longer manage their finances on their own.

This type of nursing home abuse may not cause physical harm, but the loss of life savings can cause emotional turmoil and impact well-being.

Just ask Rella Herman, a Holocaust survivor whose life savings were stolen by her former caretaker. Rella saw her caretaker every day, even entrusting the woman with her credit cards to buy groceries and prescriptions.

“This was her only friend,” Her grandson Micah said in an interview with a Miami news station. “This is someone she saw more than anybody.”

To make matters worse, this financial abuse took place as Rella’s son lost his battle to cancer.

“She was absolutely traumatized,” Her grandson said. “To be betrayed like this after everything she went through was too much.”

Sadly, many others like Rella continue to suffer from financial abuse each year.

The National Adult Protective Services Association (NAPSA) notes that just 1 out of every 44 cases of elder financial abuse gets reported.

To keep your loved one safe, it is important to understand why seniors run a higher risk of financial abuse.

Why Are Seniors at Risk of Financial Abuse?

Seniors are at risk of financial abuse because they may not be able to properly care for themselves or their finances. This dependence on others — often coupled with a large amount of savings — makes them common targets for untrustworthy strangers and loved ones alike.

Common reasons seniors may not be able to care for their finances include:

• Cognitive decline: Seniors with Alzheimer’s or dementia often struggle to make coherent decisions. Nursing home staff members, attendants, or even loved ones may manipulate these seniors and take control of their credit cards or bank accounts.
• General care: As seniors age, they may not be able to take care of themselves even if they are still mentally sound. A sense of helplessness or fear of mistreatment by a caregiver may cause an elderly person to revise their will, take out loans on a caretaker’s behalf, or otherwise be coerced into giving up their money.
• Social isolation: Seniors in nursing homes may have limited ability to visit friends and family, leading to isolation and loneliness. This may make them emotionally vulnerable to anyone willing to be their “friend.” Relatives who don’t check in often may also not notice if someone is taking advantage of a nursing home resident.

As your loved one transitions into a nursing home, make sure that those closest to them are trustworthy. This includes other relatives, financial advisors, and staff members.

Who Commits Financial Abuse Against Nursing Home Residents?

Simply placing a loved one in a nursing home can open up many possibilities for financial abuse. Understaffed nursing homes may leave vulnerable residents socially isolated, unsupervised, and more at risk of being taken advantage of.

People who may financially abuse nursing home residents include: 

• Nursing home staff members: Staff members can befriend a senior in a nursing home — only to betray their trust by taking advantage of them financially.
• Relatives or loved ones: A senior may trust a sibling, child, or other relative to look after their money. Instead of taking care of those finances, a relative could use the money for their own purposes.
• Those with the power of attorney: Though individuals with the power of attorney legally have the right to manage someone else’s affairs, that power can be abused for personal gain.
• Third-party scams: Seniors with access to a private phone, cell phone, or computer in a nursing home could fall victim to scams. These scams can trick elders into giving away personal information or buying phony products.

If your loved one lives in a nursing home, you can help protect them by recognizing the warning signs of elder financial abuse.

How to Know if Your Loved One Is a Victim of Financial Abuse

Those in nursing homes may be dealing with medical or physical problems that prevent them from living independently — and put them at particular risk of elder financial abuse.

If you suspect elder financial abuse, ask yourself these questions: 

• Is your loved one unable to tell you where their money is going? An elder should have access to information on how their money is spent. Money that is unaccounted for may be a sign of a scam. In one case, a contractor in Colorado had an elderly woman withdraw up to $20,000 a week, supposedly for home repairs. In reality, the contractor lived in the woman’s home while she stayed in a motel waiting for him to complete the job.
• Did they recently change their will? Someone with the power of attorney may take advantage of an elderly person by having them leave large or larger sums of money to the agent. Caretakers may also threaten, trick, or pressure an elder into changing their will.
• Are they receiving regular credit card bills? To stop a senior or their loved ones from noticing large credit card bills, someone committing elder abuse might hide statements. In the case with Rella Herman, the 93-year-old Holocaust survivor, her caretaker took credit card bills out of the mailbox and hid them, prolonging the scam for months on end.
• Are there missing checks from their checkbook? Checkbooks are often overlooked when searching for financial abuse, but writing checks is a common way that people take financial advantage of the elderly. In 2018, a nursing home employee in Minnesota used a resident’s checkbook to buy hundreds of dollars worth of items.

Any of these signs could mean your loved one is at risk. Being able to recognize them helps prevent elder financial abuse from affecting your loved ones.

Protecting Seniors from Financial Abuse in Nursing Homes

Financial abuse affects 1 in 5 older Americans, according to Jilenne Gunther, head of the AARP’s BankSafe initiative.

Though elder financial abuse continues to present a huge threat to seniors in nursing homes, you can take steps to keep your loved one safe.

Here are some ways to protect your loved one: 

• Become their financial conservator: A financial conservator helps manage a person’s financial accounts if they can no longer do so by themselves. Some seniors still insist on managing their own finances, but having a trusted relative on the account will help ensure they don’t fall victim to a scam.
• Check up on them regularly: If your loved one is in a nursing home, you should check up on them as often as you can. Make sure the staff members are treating them fairly and meeting their needs — and, if they still control their own finances, keep track of where their money is going.
• Protect them through other programs: Some seniors may qualify for other benefits, such as VA benefits. If they are eligible for these benefits, they may also qualify for the VA’s fiduciary program, which helps protect seniors who cannot manage their own VA benefits from financial abuse.

By keeping a close watch on your loved one — and their bank accounts — you can ensure their golden years are free from financial ruin.

If you believe your loved one is suffering from elder financial abuse, there are ways to help. Explore our nursing home and elder abuse resources to learn how to prevent and report abuse.