Elder Abuse Awareness Day 2021: ACFCS highlights tips, tactics to counter fraudsters, scammers targeting country’s most vulnerable group – CFCS | #romancescams


Pandemic further magnifies gap in elder abuse prevention, enforcement

In many countries there is a “lack of adequate legislation at national level to protect the rights of older persons and the absence of a dedicated internationally agreed legal framework,” such as domestic and international investigative task forces.

These persisting vulnerabilities “have contributed to the inadequate responses to the COVID-19 crisis and that these gaps must be filled,” when it comes to elders.

One potential solution: Similar to fighting other financial crime through stronger compliance defenses, creating more detailed and stringent international standards for investigations, penalties and protections.

The U.N. is calling on member countries to “develop universally applicable normative standards for the protection of older persons against violence, neglect and abuse, which would contribute to providing a comprehensive response and would also provide guidance for the development of a reporting, accountability and remedy mechanism for such violations suffered by older persons.”

The moves to shore up investigative gaps are vital as many criminals and fraudsters – now emboldened by the fear and uncertainty of a pandemic and plying schemes tied to desperately needed protective equipment and stimulus checks – are more aggressively attempting to scam people out of whatever dwindling savings are left.

Even before the coronavirus, the financial tally lost of elder financial fraud around the globe is staggering.

Seniors in the U.S. are scammed out of anywhere from $3 billion to $37 billion a year, according to studies cited in media reports.

Between 2013 and 2017, those older than 70 lost an average of $41,800 to elder financial exploitation, according to an analysis by the U.S. Consumer Financial Protection Bureau.

The losses are even higher when the scammer is a friend or relative, the person supposed to be a trusted member of a person’s support system.

The scope, complexity and magnitude of the elder financial fraud was highlighted by the U.S. Department of Justice in 2018, where federal investigators announced the largest crackdown on elder fraud in U.S. history – involving more than half a billion dollars.  

Prosecutors filed criminal charges against more than 250 alleged fraudsters in mailing, telemarketing schemes, with losses stemming from these plots are estimated at more than $500 million.

To read more about DOJ’s historic elder-focused enforcement sweep, click here.

And still, elder abuse is “vastly under-reported; only 1 in 44 cases of financial abuse ever comes to light,” according to the National Adult Protective Services Association, or NAPSA, and media reports.

As age of customer rises, so do risks of financial fraud by caretakers

These issues are well known ACFCS.

The association has extensively covered the dynamics at play in detailed stories, webinars and during live events, a challenge as standard AML compliance risk assessments may miss the more nuanced red flags at play in this crime because a critical delineating factor is not the size of the transactions but the age of the customer.

As well, classic risk patterns invert when it comes to elder customers.

For instance, in most cases, direct relatives and caregivers are low-risk entities tied to certain accounts, where compliance analysts typically look for risky entities outside the bank trying to break in – but that changes when the elderly are involved.

Ironically, for many cases of elder abuse, it is a close family member attempting to take advantage of an elder parent or relative that is incapable of saying no to certain transactions when individuals attempt to drain their savings, investments or run up credit card debt in their name.

According to the Census Bureau’s “middle series” projections, the elderly population will more than double between now and the year 2050, to 80 million. By that year, as many as 1 in 5 Americans could be elderly.

This puts more pressure on bank compliance teams to look for the signs of elder abuse, including: 

  • Has an elder customer with a stable account balance suddenly started incurring non-sufficient funds (NSF) charges or low account balance?
  • Has an elder customer account shown a large increase in withdrawals or checks to unfamiliar recipients?
  • Do accounts of an elder customer show large transfers into the account from investment accounts, only to be quickly withdrawn?
  • Is an elder customer with no or infrequent ATM withdrawals now showing an increased pattern of ATM withdrawals?
  • Is an elder customer with consistent spending patterns now showing a sharp increase in spending?

To help compliance teams and investigators better spot transactions tied to crimes against the elderly, ACFCS has culled some guidance and tips from our archives.

While usually available only to members, we’ve unlocked this content for public access to help spread awareness of this critical topic, and the role all financial crime professionals can play in combating elder financial exploitation.

To read ACFCS coverage of Elder Abuse Awareness Day 2019, click here.

To read ACFCS coverage of Elder Abuse Awareness Day 2018, click here

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