As the population in the United Kingdom and most of the Western world ages, the elderly control a larger portion of our wealth. But as the elderly continue to age, this means that we are seeing larger amounts of money being controlled by people whose cognitive abilities are beginning to decline, which makes them perfect targets for abuse. According to Politico, a 2016 survey of Americans found that 1 in 5 seniors admitted that they were the victims of exploitation, and the real number is likely much higher as many do not want to admit they have been scammed.
Accountants thus have a major responsibility to ensure that their elderly clients are not taken advantage of, and this carries unique challenges in trust and competence. We must understand how the elderly can be abused, some warning signs which we can use to detect abuse, and what we can do to stop it.
Two Kinds of Abuse
While categorizing a topic as important as elderly abuse carries difficulties, there are two kinds of elderly abuse.
The first kind are scammers, who are not particularly different from the scammers and hackers which all of us have to deal with. They send phishing emails, they pretend to be someone the victim trusts, and they trick people online. The National Council of Aging has a list describing these scams and how they operate.
The elderly are particularly vulnerable to these scammers for a few reasons. First, the elderly have more expenses which makes it easier for a scammer to offer an easy way out in exchange for a little money. That many seniors are unable to keep with rapidly evolving technology and often socially isolated also makes them easier targets.
But while these scammers are dangerous, most seniors are abused and tricked not by distant figures online, but by people they trust including their kin. A retiree gives his child power of attorney over his finances, but the child frivolously spends the parent’s money for himself. A nephew begs his elderly uncle for a loan to help pay the rent, only to ask again the next month, and the month after.
This second kind of abuse can be far more devastating. Family members know better than some scammer how much money a senior has as well as their mental condition. Under the right circumstances, the gains of taking advantage of someone who cannot easily protect himself become too luring to resist. In addition, the loss of trust caused by such a betrayal can easily tip a senior citizen towards isolation and depression, making them more vulnerable to subsequent scammers.
Family abuse is much trickier for accountants to handle, not least because their clients will often be more inclined to trust their family over you. Given how many seniors are abused, your first step is to watch your clients for warning signs indicating that they may be victims.
The first and most basic thing to watch for is any sudden changes in the client’s lifestyle. Maybe their clothing or car has gotten worse, or they report trouble paying their bills. If your client’s finances have gotten worse, it is your responsibility to investigate if something new has caused it.
There are many other indications. If your client cannot recall sudden large transfers of money, that is a potential sign. If a relative moves in as a caretaker, that relative is in prime position to take advantage of your client. If your client suddenly makes a new friend who they praise frequently, that is another potential sign. The National Committee for the Prevention of Elder Abuse has a list of signs detailing potential indications of elderly abuse.
Remember that even if these indicators exist, the explanation could be perfectly innocent. In order for you to make the right judgment call, you need as much information from your client about how they are living.
Caring for your Clients
How do you get that information, and how do you make sure your clients are safe both from scammers and family abusers? The first step is to alert clients to the possibility of elderly abuse. Talk to them about the scams described above, and remind them that they should never give away personal or financial details to anyone through phone or email no matter the circumstances.
But more than anything, you need to give clients a reason to trust you. As noted above, it can be difficult to get clients to believe that their own children or relatives are abusing them. Build a personal rapport with your clients, always look for ways to educate them, and be friendly. Clients may need a hand they can trust if they feel that they have been betrayed. You may have to be that hand.
Dealing with abuse is a serious challenge, but accountants must be prepared to battle abusers and scammers as we shoulder greater responsibilities. That requires education, trust, and a willingness to impart hard truths.