Elderly financial Abuse
Elderly people are frequent and easy targets for financial abuse by perpetrators who convert money and other properties of the elderly for the main aim of benefiting out of the assets of the person and leaving him/her in a financial crisis. These perpetrators are mostly the family members who include sons and daughters, grand children and spouses, caregivers and other persons who the elderly person may have trust in.
The person’s motive is to acquire finances from the old especially if the person has financial problems, the person may feel that they have the right to the finances, they may have a negative attitude towards other siblings and don’t want them to benefit or if they have an unstable relationship with the elderly and fear that they might not be included in the property once it is divided.
Elderly people are mainly the target of the perpetrators because they are easy to manipulate and persuade to giving up their finances, the isolated and lonely, mentally disturbed and people who lack financial information and don’t know financial matters are also a an target for perpetrators. (Hardings, King& Kelly, 2002). Perpetrators first identify the vulnerable persons like the isolated and recently widowed people through news papers. They then woo them by pretending to love and take care of them, by seeking employment in their homes so as to learn about their properties and finances, or by pretending to be concern about these people.
There are several methods used by unethical financial advisors to acquire the finances from elderly persons. these methods are such as forging signatures of the elders, using their property without prior permission, fraud (which include deception, false pretence, trickery and dishonesty for financial gain) and getting an old person to sign a will or deed and/or bribing the old person’s attorney so as to acquire their money and other types of finances.
Overcharging of goods, use of deceptive business practices and buying trusts from old people are other methods used by business men and professionals to get financial gain from the old people. A senior lecture, Dr Cheryl Tylse specializing in management of the elderly assets at Queensland University notes that elderly financial abuse from family members and financial markets is getting worse.
He says that family members are getting more and more interested in inheriting the old person’s property while markets engaged in selling financial markets are selling unreasonable financial products such as reverse equity mortgages, financial plans and accommodation products such as the retirement villages to the elderly persons. He further says that there are new banking trends which are emerging posing a threat to the property of elders thus leading to increase in elderly financial abuse. (Hardings, King& Kelly, 2002).
There are various unethical financial advises given to the elderly people by their financial advisors so as to gain from them: Churning is one of the unethical practices which are used by financial advisors. This method is employed by the financiers to increase their commissions through excessive trading with their clients’ accounts. Financial practitioners churn by controlling investment decisions of a client; they seek a written document from their clients and once they have control over their accounts, the financiers then get involved in excessive trading using the financial resources of the clients.
They are also engaged in risky investments for the purpose of getting high commissions from the trading that they carry out. Frequent or excessive trades on the clients’ accounts without prior authorization, trading activities which lead to high commission generation, frequent short term trading without any significant losses or gains and undue influence by the financial advisor to control the clients’ accounts are some of the characteristics that portray cases of churning and they can help a client to know whether his/her account has been churned by their financiers.