Financial Crimes Against the Elderly

Understanding Your Local Problem

The information provided above is only a generalized description of financial crimes against the elderly. You must combine the basic facts with a more specific understanding of your local problem. Analyzing the local problem carefully will help you design a more effective response strategy.

Most likely, there will be a combination of frauds committed by strangers and financial exploitation by relatives and caregivers. You should analyze the factors surrounding these two crimes separately, since they are different in nature. Further, although developing profiles or combined data on the crimes (e.g., average amount of money lost, average age of victim, etc.) can be useful, these averages can mask important variations and may lead to generalized responses that fail to combat a particular type of fraud or exploitation.

In the case of consumer fraud, it is likely that a few different types will be occurring in your community at any given time. It is important to identify the types of fraud currently operating, the likely targets, the means used to commit the fraud, and the factors that may prevent victims from reporting it. Given that a significant number of seniors have likely resisted a variety of fraudulent sales pitches, it will be useful to identify the strategies they used to avoid being victimized.

In the case of financial exploitation, it is important to understand how offenders gain access to the victims' funds, what the nature of the offender-victim relationship is, and what resources are available to support and protect the elderly. Interviews with professionals who have observed various financial transactions will help to identify areas in which procedural safeguards could be employed.

Although fraud and financial exploitation cases have some similarities, the situations facilitating the crime will vary considerably. In addition, the fact that many cases go unreported means that official police and prosecutor records will not include the details necessary for a comprehensive problem analysis. Therefore, it is important to gather information about the local problem from multiple sources and perspectives, including:

Official police and prosecutor records
Computer-generated maps of reported fraud incidents
Victims and concerned friends and family members
Seniors not previously identified as victims
Local advocates for the elderly
Adult protective services workers
Fraud and financial crimes investigators
Bankers, attorneys, and accountants
Perpetrators of fraud and financial exploitation.

Asking the Right Questions

The following are some critical questions you should ask when analyzing your particular problem of financial crimes against the elderly, even if the answers are not readily available. The questions are listed separately for fraud and for financial exploitation. Your answers to these and other questions will help you choose the most appropriate set of responses later on.

Fraud: Victims

What are the victims' characteristics? Do they typically live alone? Are they homeowners? Are they home during the day? Is there any evidence of diminished mental or physical capacity?
How exposed to fraud are they? Do they routinely enter contests and sweepstakes? What other marketing efforts are they exposed to? How often do salespeople contact them by phone? By mail? In person?
What factors influence the decision to buy goods or services? Particular characteristics of the salesperson or the pitch? Need for the good or service offered? Fears about their financial situation, health, or long-term care?
How did they report the crime? What factors influenced them to do so? What factors could have deterred them from reporting?

Fraud: Persons Who Avoid Victimization

What are the characteristics of persons who avoid victimization? Do they typically live alone? Are they homeowners? Are they home during the day?
How often are they exposed to marketing efforts by phone? By mail? In person? Have they done anything to decrease their exposure to these efforts?
What do they do to stop unwanted sales offers?
Do they routinely discuss their purchases or financial matters with anyone? How aware are they of various types of fraud? Do they know how to research products or offers before buying?
Do they suspect they have ever been a victim of fraud, even though they did not report it? What deterred them from reporting? What would encourage them to report a fraud in the future?

Fraud: Offenders

What are the offenders' characteristics? Do they usually work alone, or in groups? How do they identify potential partners?
How do they develop the frauds? Do they use a variety of means, or do they stick to a particular method (e.g., mail, phone, in person)? Do they specialize in a particular kind of fraud, or commit a variety of them?
How do they identify potential victims? How are "mooch lists" developed? From where are they purchased?
What motivates them? Money? Power? A sense of importance?

Fraud: Incidents

What types of frauds are most frequently reported? Are there similarities in the types of frauds that typically go unreported?
Where are the frauds occurring? Are they clustered in specific neighborhoods or geographic areas? Are the victims similar?
What method is used (e.g., mail, phone, in person)? Is there evidence that the offenders work from another jurisdiction?
What tactics are used to avoid detection? Time pressure? Secrecy? False address? Use of a courier?

Financial Exploitation: Victims

What are the victims' characteristics? Do they live alone? Do they have regular contact with nonabusive family or friends? Is there evidence of diminished mental or physical capacity?
What is the victim-offender relationship? Elder and relative? Elder and caregiver? What are the relationship's positive aspects? Companionship? Promise of long-term care? Fulfillment of family obligations? Of cultural expectations?
When did the victim become aware of the exploitation? How was the incident reported? What factors encouraged reporting? What factors discouraged reporting? To what extent were friends or family involved in discovering and reporting the incident?

Financial Exploitation: Offenders

What are the offenders' characteristics? Do they work alone, or in groups? Do they have a history of exploiting others? How does the caregiving relationship start? Does the offender volunteer? Is the offender hired through an agency?
What motivates offenders? Money? Power? Feelings of entitlement? Concerns about inheritance?
How do offenders get victims to comply? Isolation? Promises? Undue influence? Coercion? Theft?

Financial Exploitation: Incidents

What are the primary means used to commit the crime? Joint accounts? Legal documents such as wills, deeds, trusts, powers of attorney?
What professionals are involved in the transactions? Bank tellers? Attorneys? Accountants? How may they unwittingly facilitate the crime?

Measuring Your Effectiveness

Measurement allows you to determine to what degree your efforts have succeeded, and suggests how you might modify your responses if they are not producing the intended results. You should take measures of your problem before you implement responses, to determine how serious the problem is, and after you implement them, to determine whether they have been effective. All measures should be taken in both the target area and the surrounding area. (For more detailed guidance on measuring effectiveness, see the companion guide to this series, Assessing Responses to Problems.)

The following are potentially useful measures of the effectiveness of responses to financial crimes against the elderly. As with the previous sections, the two main types, fraud and financial exploitation, are discussed separately. Further, distinctions are made between "process" measures, which indicate the extent to which responses are being implemented as designed, and "outcome" measures, which indicate the impact the responses have on the level of the problem.

Fraud

You can use the following "process" measures to identify the extent to which selected responses have been implemented as designed. Given the extent of underreporting and its impact on understanding the scope of the problem, a corollary evaluation goal may be to assess the success with which reporting mechanisms are used:

Increases in the number of seniors who are aware of current frauds and have been trained how to stop unwanted sales efforts
Increases in the number of arrests, prosecutions, and convictions of operators of fraudulent marketing schemes;
Increases in the use of consumer protection resources to investigate the legitimacy of offers or businesses
Increases in the use of mechanisms to report attempted or successful frauds.

You can use the following "outcome" measures to determine the impact of your responses on the level of the problem:

Decreases in the dollar amounts lost by elders to consumer fraud
Decreases in the number of elders defrauded via mail, telephone, or in-person scams
Decreases in the number of elders who are revictimized by "recovery room" operations.

Financial Exploitation

You can use the following "process" measures to identify the extent to which selected responses have been implemented as designed:

Increases in the number of professionals (e.g., bankers, doctors, lawyers, accountants) trained to identify the warning signs of financial exploitation
Increases in the number of reports of financial exploitation shared across agencies (e.g., police, prosecutors, adult protective services)
Increases in the number of elders proactively protecting their financial assets
Increases in the number of offenders arrested, prosecuted, and convicted for financial exploitation of elders.