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Elder Financial Exploitation by the Numbers

7/11/2019 - By Stephen Helms-MacBeth, CRCM, CAFP

With the dedicated Elder Abuse Prevention Month of June behind us, it is important to not rest on your laurels. Elder financial exploitation, a form of Elder Abuse, is defined as the illegal or improper use of an elderly adult's funds, property, or resources by another individual. Sadly, this exploitation is alive and well all year round. It wears many masks, including romance scams, predatory financial products and services, and even exploitation or theft by trusted individuals such as family members, fiduciaries, and caregivers. 

For those of you working diligently in the financial industry, we remind you that in February of this year, the Consumer Financial Protection Bureau (CFPB) issued an eye-opening summary of Suspicious Activity Reports on Elder Financial Exploitation: Issues and Trends. During the past five years, the Financial Crimes Enforcement Network (FinCEN) has collected more than 180,000 suspicious activity reports (SARs) from banks, credit unions, and other industry participants. The reports reflect financial crimes, or potential financial crimes involving more than $6 billion dollars!  

According to February’s report, SARs related to elder financial abuse and exploitation quadrupled from 2013 to 2017. Elder financial exploitation is not limited to traditional financial institutions; the report shows money service businesses (MSBs) are beginning to file a larger share of SARs. For SARs involving confirmed losses, it was reported that on average adults between the age of 70-79 lost $43,300, and even more if the elder adult knew the suspect. Less than one-third of SARs specified that the filer contacted or reported the activity to an adult protective service or law enforcement agency, and less than one percent if the filer was an MSB.

Although the issue itself is heartbreaking, it is encouraging to see our banks and credit unions reporting suspicious activity and doing their best to protect this vulnerable group. To learn more about the summary report or about ways that financial institutions can further prevent and respond to elder financial exploitation we encourage you to review the summary report and to refer to its Appendix C that lists additional related resources.  

About the Author | Stephen Helms-MacBeth, CRCM, CAFP
Stephen is a manager in the Financial Institution Advisory Group at Saltmarsh, Cleaveland & Gund. He has been working in the financial institutions industry since 1992, concentrating primarily on compliance, operations and policies and procedures. Stephen currently works with the firm’s financial institution clients providing loan and deposit compliance, Bank Secrecy Act (BSA) and compliance review services. Connect with Stephen on LinkedIn.

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