Elder financial abuse is a growing problem, and the stories of those scammed out of their hard-earned money keep coming, from phishing emails and texts to family members taking advantage.
According to the Federal Trade Commission, consumers lost over $10 billion to scams in 2023, and NBC News reported that more than 101,000 Americans over 60 were victims of digital fraud in that same year.
In March of this year, a woman in Providence, RI, stole more than $240,000 from her mother’s bank account without her authorization. Her mother had been diagnosed with Alzheimer’s in 2015, and she had been living in an assisted living facility.
To raise awareness of elder abuse scams, March 6 has been designated National Slam the Scam Day and June 15 is World Elder Abuse Awareness Day. And as we are now in National Financial Literacy Month, we decided to find out what’s being done about it.
What’s Being Done About Elder Financial Abuse?
At the federal level, there is the Elder Justice Act. First passed in 2010, it was the first comprehensive legislation made to address exploitation and abuse at the federal level, and it authorized programs to promote elder justice research and coordinate federal responses to elder abuse.
Laws are in place or being introduced in several states across the country to address and protect elderly citizens from financial abuse. Idaho worked with its respective branches of the AARP and credit unions to create House Bill 323, also known as the Financial Exploitation of Vulnerable Adults Act. Similar to bills passed in other states, it allows financial institutions to hold a transaction they believe could be fraudulent and report it to the proper authorities for further investigation. Earlier this year, legislation was introduced in Michigan to strengthen protections for those of advanced age who need additional assistance. The bill would also strengthen penalties against perpetrators of elder financial abuse and develop programs to help with fraud prevention.
Right here in Louisiana, the governor has established an Office of Elderly Affairs, which covers financial abuse. Louisiana law requires anyone who reasonably suspects elder financial abuse to report it to the Elderly Protective Services (EPS) or to any local or state law enforcement agency. The name of the reporter is kept confidential. For our Louisiana credit unions, you can call the toll-free Statewide Hotline at 1-833-577-6532 for vulnerable persons 60 and older.
What Can Credit Unions Do About Elder Financial Abuse?
A statement from the NCUA and other government organizations states there are several things credit unions can do help prevent elder fraud within their organizations.
1. Place Transaction Holds
According to the interagency statement, if a transaction or disbursement appears fraudulent, a temporary hold or delay should be put in place. When these holds are used in compliance with the law, they help prevent the loss of funds and allow time to investigate and establish the legitimacy of a transaction.
2. Train Staff
Credit unions should protect elderly members from fraud by training employees to recognize it. Employee training in fraud prevention should include how to spot the red flags for various fraud types, what actions should be taken if concerns arise, and the processes for timely reporting and action.
3. Develop a Plan for the Reporting of Financial Records
When a case of elder financial abuse is reported, law enforcement and other agencies will need documentation and records to support the investigation. Credit unions should have or develop a plan to share records and documents with the proper authorities.
4. Raise Awareness
One of the best things credit unions can do is raise elder financial abuse awareness among members with blogs, social media, videos and other communications. Credit unions can also partner with local nonprofits that deal with elder financial abuse and connect members with them. As more people become aware these scams exist, they will be more likely to recognize when someone is trying to take advantage of them or their loved ones.
As baby boomers and even larger generations age after them, credit unions and their members must stay on guard to protect themselves. Fraudsters are becoming more sophisticated every day, so keep educating, innovating and lobbying to pass legislation to make it more difficult for scammers to steal elder members’ hard-earned money.
To speak with LaCorp about this or working with the nationwide corporate credit union, please contact LaCorp here.