Have you ever been interrupted during something important by a phone call from an unknown number within your area code? The first one you let go, but in the back of your mind you come up with all the important messages that call could be trying to deliver. Is someone hurt and trying to call you? Has there been some emergency? While those thoughts stir in the background, the same number calls you again. This time you pick up, sure it is terrible or important news only to hear “Congratulations! You have won a free cruise to the Caribbean”. This kind of attempted exploitation is easy to stamp out, and all you have to do is hang up the phone. Unfortunately, attempts to steal your personal information and money can take on many, less obvious forms.
The term “financial exploitation” means the illegal act of taking economic advantage of someone for one’s personal gain. Examples of this include forging checks, bank account theft, and abusing a power of attorney authorization. Financial exploitation is on the rise today as the baby boomer generation reaches their 60s and 70s, and begins to rely more on caregivers and family members to help them manage their health and financial matters. According to the Senate Special Committee on Aging, senior citizens lost an estimated $2.9 billion from financial exploitation in 2018.
Unfortunately, only 1 out of every 44 cases gets reported to local and federal law enforcement. It’s important to note that senior citizens are not the only adults at risk of financial exploitation. Any adult relying on others down the road to make financial decisions for them, can fall victim to this type of crime. This can happen when family members, “friends” and caretakers begin demanding personal loans after learning about the vulnerable state of health of the adult. If the vulnerable adult is dependent on the individual for health care services or other necessities, they may feel pressured to lend them the money.
Federal and state authorities along with financial institutions, have recognized this growing crime against vulnerable adults & senior citizens, and have passed laws and created new best practices for preventing this type of fraud. As a fiduciary, Merriman takes great pride in putting our client’s best interests first. If we suspect you may be the victim of financial exploitation, we will take the appropriate steps to protect you and your assets. That may mean reporting the incident to state authorities such as Adult Protective Services or working with your account’s custodian to prevent funds from being withdrawn.
Since this is an important decision, and one we do not take lightly, Merriman has recently created its own form that allows us to contact a designated individual(s) when we suspect our clients may be victims of financial exploitation and their health status is the primary reason. This allows us to be in touch with someone familiar to your specific situation who can give us additional information to dispute or validate our concerns.
We encourage you to be mindful of this growing risk, shield yourself from personal relationships that center around you giving them money, as well as designate a trusted contact for your advisor or custodian to reach if they suspect you may be the victim of financial exploitation. Please note that this individual will not be authorized to make financial decisions for you.
At Merriman, we believe it is important to help you do more than just grow your wealth. It is for this reason we share this concern as a way to help protect the wealth that you have worked countless years to accumulate, and to keep it away from those looking to exploit your hard work and discipline. We encourage you to ask your advisor about completing a Trusted Contact Form during your next review to ensure they know who to contact if they believe you may be the victim of attempted financial exploitation.
If you believe you would be a good Trusted Contact person for a close friend or family member, please feel free to use this article to start the conversation with them about placing you in that role. That way you can help to look out for them in the same way your Trusted Contact will look out for you.
Written by former Merriman CCO, Erick Aguayo
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