The Outrage and Shame of Senior Financial Abuse

Criminals and con men in fiction are such lovable scamps.  That’s because, aside from the fact that they tend to be portrayed by the likes of Paul Newman and George Clooney, they also – in the movies – go after bigger, more powerful criminals than themselves.

The reality is much more sordid.  In real life, con men and women deliberately and cold-bloodedly target the most defenseless among us.  Their favorite victims?  The elderly, who are often easy targets who’ve built up a lifetime of savings. After all, who could be more vulnerable to digital hit-and-run fraud than seniors, many of whom have marginal computer skills and little understanding of how online fraud plays out?

According to the Consumer Financial Protection Bureau seventeen percent of senior citizens have reported being scammed, with an average loss of $120,000 each, though the real totals, both of victims and funds stolen, may be far higher. U.S. seniors’ collective financial losses from scams amounts to a shocking three billion dollars annually.

Other factors besides spotty computer skills make seniors a disproportionate mark for scams. Criminals target them, according to the FBI, because they’re likely to have a substantial nest egg saved up. As Willie Sutton might have noted, “That’s where the money is.”

But there’s an additional set of dynamics at work in the victimization of America’s elderly. Seniors, who grew up in the thirties, forties and fifties—less cynical times—often place a greater premium on civility than caution.  Moreover as occasional, rather than habitual internet users, who often use email and social media to keep in contact with friends and family, they may be less guarded than younger people who have a clearer understanding of just who may be out there. Unfortunately, they can also be less likely to report a fraud, due to potential embarrassment, or shame about a feared decline in their cognitive functioning.

Now MarketWatch reports this targeting of seniors has become such an epidemic banks are being forced to take steps to protect their elderly account holders. In the first quarter of this year Wells Fargo began deploying software technology to detect abuse in some seniors’ wealth-management accounts.

The technology closely follows the investing behavior of account owners, gradually recognizing the unique pattern of their transactions. This can include a sudden change of address on the account, the opening of a new joint checking account, as well as the sudden accumulation of insufficient funds or overdraft fees.

In one instance, Wells Fargo software alerted banking officials to an individual who had written more than a hundred checks over the period of a year which totaled a hundred and eighty thousand dollars.  The problem was the checks were made out to people who didn’t seem to be associated with the account holder.

To its credit, the American Bankers Association has been giving awards to banks that have developed programs to combat elder abuse. But while this makes for glorious PR, I suspect it might just represent the tip of the iceberg, and amount to too little too late for millions of seniors who thought they’d have enough cash to see them safely through their sunset years.

While it’s comforting to think your bank has state-of-the-art software to help it watch your back, don’t depend on it. Take responsibility for your own financial security, and regularly log in to your own account. As for that FBI portrait of a trusting, compliant senior citizen, forget about it! Far better to be thought of as a cranky, demanding depositor – and hopefully, someone who’s too much trouble to mess with.