Ask Kim
How to Protect Parents from Elder Investment Fraud
Your mom and dad may be at a greater risk for exploitation than you think.
By Kimberly Lankford, Contributing Editor, Kiplinger's Personal Finance
June 17, 2010
My mom went to a free-lunch seminar about retirement income a few weeks ago, and now a salesman keeps making high-pressure calls asking her to invest with him. What can we do?
Tell him to stop calling and report him to your state securities regulator (you can find links to the state regulators at NASAA.org).
Unfortunately, many seniors are victims of scam artists and high-pressure sales tactics. One in five people older than 65 reported being taken advantage of financially through inappropriate investments, unreasonably high fees for financial services, or outright fraud, according to a survey on elder investment fraud that was recently released by the Investor Protection Trust.
Crooks tend to target seniors because they’ve accumulated big balances in their retirement accounts and are looking for ways to stretch their savings. Seniors with mild cognitive impairment can be most at risk for financial exploitation -- they may still be able to perform daily functions, but they can get confused when it comes to money matters.
It’s important for family members to keep vigilant watch for potential scams: 37% of the seniors surveyed said they get solicitations from people asking them for money and pitches for bogus lotteries and other schemes, but only 19% of adult children thought that their parents were being pressured in such ways.
It also helps for physicians to be aware of some signs of financial exploitation. Doctors are usually the trusted professionals who see seniors most often, especially if adult children don’t live nearby. A new program developed by the Investor Protection Trust, the North American Securities Administrators Association and the Baylor College of Medicine aims to educate physicians about some of the warning signs of financial exploitation.
Baylor created a pocket guide for physicians listing several red flags, such as a senior who is accompanied by an overly protective caregiver who dominates the patient. The guide also tells doctors to be on the lookout for statements such as “I don’t feel confident making big financial decisions alone,” or “I don’t understand financial decisions that someone else is making for me,” or “I have trouble paying bills because the bills are confusing to me.” The guide, which is available at the Investor Protection Trust Web site, also lists resources for social services, investor protection and legal advice.
In fact, it’s a good idea for anyone -- including adult children -- to keep an eye out for those financial concerns. Such statements could signal that someone is trying to take advantage of a senior or that he or she is starting to need some help with financial matters. See What You Should Know About Your Parents’ Finances and How to Discuss Money With Your Parents for more information about what you can do if your parents need help.
If you do suspect that someone is trying to take advantage of your parents, contact your state securities regulator. NASAA.org also has a lot of helpful information in its Senior Investor Resource Center.
For more information about reporting high-pressure salespeople and fighting back against senior scams, see Protect Your Retirement From These Investment Scams and Watch Out for Scams Targeting Seniors.
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Reader Comments (3)
Posted by: joan at 06/18/2010 09:01:15 PM
i'm getting really tired of all these tell, save, prepare, alert your parents stories here and elsewhere. i am 69 and not brain dead; am on line and don't have children. TALK TO ME!
Posted by: Nomen at 06/20/2010 08:12:41 AM
"Doctors are usually the trusted professionals..." Not from my experience. Most of the over charges and billing errors come from doctors and hospitals. Most of their billing functions have been outsourced to often poorly qualified billing people. The insurance companies also share the blame because they will deny claims based on minor "so called" coding errors. Rather than correct the over billing errors, it is easier to just send the bill to the patient and threaten that it will be sent on to a collection agency if it isn't paid. Most elderly people are afraid to protest and simply pay the bill. The elderly end up being taken twice. They pay for health insurance that should have covered the bill and they end up paying the medical bill for things that should have been covered. The government does little or nothing to protect the elderly. There is only one defense against this. KNOW WHAT YOUR PARENTS INSURANCE COVERS AND IMMEDIATELY PROTEST ANY OVER CHARGES. I personally caught over $12,000 in over charges on my parents medical bills in four years...
Posted by: Bob at 06/21/2010 11:00:32 AM
I noticed that some don't like articles like this but they are very appropriate for many of us that have been trying to help our parents cope with elder predators. Those without helpful children may well be on their own. Even for the able bodied a little stroke or other decline in health can change everything. As with everything else that is inevitable in life, it's not a matter of IF but WHEN.