Headlines continue to alert us to elder fraud and exploitation with large financial losses and limited ways to stop the problems. We think of these elders as crime victims, and indeed, they are. However, in some cases, the person being exploited continues to participate in the scam, to the frustration of family members or financial institutions that try to stop it. When the person is complicit in the exploitation, for whatever their own reasons are, we call that victim-assisted fraud.
In one recent case
, a 76-year-old man transferred more than $3.6 million to an unknown person over a six-month period. The 42 international transfers were discovered shortly after his death. Why didn't the bank and credit union stop the man or the transfers, which were as much as $49,500 at a time? They tried. Suspecting exploitation, they set up meetings and shared their concerns with the man, but he didn't attend the meetings and continued the transfers. The bank even stopped a wire transfer, but he sent it to a credit union account. The credit union was also suspicious and reported the possible crime to the local adult protective services. However, upon examination, the man was determined to be mentally competent. It was his account and his money, and there was nothing these financial institutions could do to help.
One group that is exploring more ways to intervene is Stop Senior Scams Now, sponsored by the Federal Trade Commission. This group, started in fall 2022, is exploring innovative ways to help elders, families, and institutions to be proactive in stopping scams. The group is exploring technology, offering training and education programs, and conducting research. I am a member of the group. As we develop more information, I will share it in future posts.
Even if you feel powerless when someone you know is being victimized by this crime, it still is helpful to report suspected cases. The Senior Safe Act 
of 2018 provides immunity from liability in any civil or administrative proceeding for reporting potential exploitation of a senior citizen if there are concerns about violating a privacy requirement.
As I noted in a previous post, people may begin to have financial lapses as long as six years before receiving a diagnosis of dementia. Being aware that problems with financial judgment and capabilities may be an early sign of cognitive decline can help concerned people be proactive with potential interventions, such as obtaining a power of attorney or even a conservatorship.
Getting back to what financial institutions and family can do: that remains an open-ended question, especially when the person doesn't want to be helped. More questions arise, such as, Why are certain folks determined to give away huge sums of money repeatedly, despite warnings, interventions, or pleas from concerned family or friends? What is the psychological issue at play that may need to be explored? What can be done to help?
Are there approaches to determining the "why" of these behaviors that might help us mitigate these issues? I'd like to hear your thoughts and experiences and solutions.
For now, here are some additional resources:
- Elder Financial Exploitation (American Bankers Association)
- Elderly Financial Exploitation Advisory (Financial Crimes Enforcement Network (FinCEN)
- Suspicious Activity Reports on Elder Financial Exploitation (Consumer Financial Protection Bureau)
By Scarlett Heinbuch, payments risk expert in the Retail Payments Risk Forum at the Atlanta Fed