Financial abuse of the elderly has been called “the crime of the 21st Century” by Kiplinger’s. And as many as one in 20 older adults in America may be victims, according to a new study in the Journal of General Internal Medicine.
Can anything be done to prevent this growing disgrace?
Maybe. I’m optimistic about a new effort aimed at getting lawyers to spot and report financial fraud targeting older Americans — scams that have ensnared Mickey Rooney, Brooke Astor and millions of lesser-known people.
Why the EIFFE Initiative Has Potential
The nonprofit Investor Protection Trust and its sister organization, the Investor Protection Institute have joined up with the American Bar Association (ABA) to launch the Elder Investment Fraud and Financial Exploitation (EIFFE) Prevention Program Legal.
(MORE: 5 Steps to Prevent Elder Abuse)
“We want to turn the tide and see fewer victims — instead of seeing elder abuse increasing, as it is now,” says Don Blandin, President and CEO of the Investor Protection Trust and the chief architect of the EIFFE program.
The EIFFE program has potential, I think, because lawyers can be among the first to spot potential trouble.
“We knew that a lot of attorneys — not just elder law attorneys — are helping seniors with estate plans and wills and powers of attorney, so they would be in a position to spot someone who could potentially be at risk of financial exploitation,” says Blandin.
Lawyers Want to Get Involved
One encouraging sign: lawyers surveyed by the three groups behind EIFFE said they want to help.
(MORE: Mickey Rooney's Elder Fraud Legacy)
Nine of 10 practicing attorneys among the 674 surveyed said they’d be willing to participate in a continuing legal education program “about detecting, preventing and redressing” elder investment fraud and financial exploitation.” That’s exactly what EIFFE will be.
Lawyers will be taught how to: recognize a client’s possible vulnerability due to mild cognitive impairment, also known as incipient dementia); identify clients who are victims and report suspected instances of elder fraud and exploitation to authorities. (The Department of Justice just launched an interactive, online curriculum to teach attorneys how to identify and respond to all kinds of elder abuse.)
Roughly one-third of Americans over 71 have some form of cognitive impairment and the total number is expected to grow as the nation ages. That’s significant because cognitive impairment makes people more likely to make financial errors and be less able to evaluate risk, according to Blandin. A new study by DePaul University business professor Keith Jacks Gamble and Rush University Medical Center’s Patricia Boyle, LeiYu and David A. Bennett, presented at the recent Retirement Research Consortium meeting I attended, bears this out.
(MORE: When Elder Abuse Hits Home)
Attorneys Need Educating
Lawyers need help detecting signs that can tip them off to potential elder fraud problems, however. In announcing the EIFFE program, Charles Sabatino, director of the ABA’s Commision on Law and Aging said that spotting, preventing and responding to financial exploitation is “not an area in which many [lawyers] are effectively trained.”
According to the New York State Elder Abuse Prevalence Study, for every exploitation case reported to an agency, about 44 weren’t reported.
Roping in the lawyers couldn’t happen soon enough: 91 percent of lawyers surveyed called elder investment fraud and financial exploitation a serious problem and 34 percent said they “are or may be” dealing with such victims on a daily, weekly or monthly basis.
“We just had a terrific reception to our launch at the American Bar Association meeting in Boston,” says Blandin.
Lawyers in five states will start taking the EIFEE classes at the end of this year. Blandin hopes to then roll out the program nationally starting next spring.
Attorneys who educate themselves won’t just be helping the elderly; they’ll be protecting themselves, too.
“Lawyers who are ignorant of financial exploitation may fail to protect their clients from harm and may unwittingly participate in their exploitation,” says Blandin. “They might then face discipline, liability and criminal charges.”
Similar Program for Doctors
This initiative follows a similar EIFFE continuing education program for doctors and other medical professionals, launched in 2010.
It has trained more than 7,800 healthcare pros around the country to curb elder financial fraud and provided them with pocket guides to detect “red flags” and help with early detection.
A Problem to Overcome
One potential snag with the lawyer's initiative: States have different rules about whether attorneys can contact authorities if they have elder fraud concerns. “It’s all over the map,” Blandin says. “Some states require you to report elder abuse if you see it and others do not.”
But lawyers are (generally) smart, and so is Blandin. I’m sure they can — and will — come up with a way to deal with this problem.
Americans who are financially abused lose an average of $140,500, according to a Certified Financial Planner Board of Standards study. Here’s hoping this new legal initiative will lead to fewer victims and smaller losses.
“There’s been a whole lot of attention on how to help elderly victims of investment fraud and financial exploitation once they’ve been victimized, as there should be,” says Blandin. “We’re trying to be laser-focused on how to prevent it in the first place.”