It’s estimated older Americans lose up to $30 billion a year to elder financial abuse at the hands of con artists and thieves. Historically, these crimes go unreported, but that could soon change. The government and financial services industry are taking steps to encourage those who are able to spot elder financial abuse, including brokers, bankers, and financial advisers to act on and report what they see.
According to Consumer Reports, a new rule issued by Finra, the self-regulatory agency that oversees brokers, went into effect on February. 5. It requires brokers to ask customers, regardless of age, to provide the name of a trusted contact. The broker would reach out to that person if there is reason to believe the client is being exploited financially.
In addition, The Senior Safe Act, a bipartisan bill now in Congress would enable the employee of any financial institution, including banks and insurers, to report concerns about elder financial abuse without fear of being held liable for disclosing private information.
While regulators are stepping up efforts to protect seniors, in the end, the most effective way to prevent elder financial abuse is to build your own safety net. Here are three steps to consider:
- Start the Money Talks. Know if your parent is keeping up with bill paying, has contact with strangers or new friends who may prove to be a risk.
- Set Up Checks and Balance. Have essential legal documents in place that will enable you or family members to help your parents if they need it, including a will, a healthcare proxy, a HIPAA release form, and durable power of attorney.
- Streamline Your Parent’s Finances. Make your parent’s finances more manageable by consolidating accounts where possible. It’s also important to maintain any beneficiary designations according to your parent’s wishes, or you could face legal challenges.