Combating Elder Financial Exploitation

Categories: Finances
A picture of a big bank in teh background. In teh front is an older man wiping his eys. He looks very sad and worried.

On December 4, 2024, an Interagency Statement on Elder Financial Exploitation (EFE) issued by several U.S. financial regulatory agencies was released to highlight the need for protecting financial exploitation of older people. This statement provides guidance to supervised financial institutions on identifying, preventing, and responding to elder financial exploitation. The goal of this statement is to raise awareness and provide strategies for combating elder financial exploitation while maintaining compliance with legal requirements.

What is Elder Financial Exploitation?

Elder financial exploitation is the illegal or improper use of an older adult’s funds, property, or resources. It can deprive older adults of their life savings and ruin their financial security. It takes many forms, including:

  • Scams
  • Abuse by trusted family members or friends
  • Predatory products and services specifically targeting the elderly
  • Using an older adult’s assets without informed consent
  • Using an older adult’s identity to open credit accounts or to access accounts
  • Misuse, concealment, or fraudulent taking of money or property
  • Tricking someone into putting their money into investments or real estate
  • Promising unrealistic big returns on investments and little or no risk

Key points from the statement include:

  1. Elder financial exploitation is a significant issue, with estimated annual losses of $28.3 billion for U.S. older adults.
  2. Financial institutions filed 155,415 reports related to elder financial exploitation between June 2022 and June 2023, associated with over $27 billion in suspicious activity.
  3. The statement outlines several practices for financial institutions:
  • Enhancing governance and oversight to protect against EFE.
  • Providing comprehensive employee training on recognizing and responding to EFE.
  • Using transaction holds and disbursement delays when EFE is suspected, in compliance with applicable laws.
  • Implementing trusted contact policies for account holders.
  • Filing Suspicious Activity Reports (SARs) for suspected EFE.
  • Reporting to law enforcement, Adult Protective Services, or other appropriate entities.
  1. The document emphasizes the importance of complying with privacy laws and the confidential nature of SARs.
  2. Financial institutions are encouraged to refer potential victims to resources like the National Elder Fraud Hotline.

Find more information and read the entire statement online HERE.

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