According to the Bureau of Consumer Financial Protection, "Elder financial exploitation is one of the most common and devastating forms of elder abuse. It can destroy the financial security of an older adult at a vulnerable stage of life. Financial exploitation can negatively impact physical and emotional health, or shorten an older person’s lifespan." This Compliance Toolkit has been developed to assist member credit unions and stakeholders in combatting elder exploitation.
Elder financial or material exploitation is defined as the illegal or improper use of an elder's funds, property, or assets. Examples include, but are not limited to, cashing an elderly person's checks without authorization or permission; forging an older person's signature; misusing or stealing an older person's money or possessions; coercing or deceiving an older person into signing any document (e.g., contracts or will); and the improper use of conservatorship, guardianship, or power of attorney.
Often, credit unions are quick to suspect elder financial exploitation based on staff familiarity with their elderly members. Credit unions have the potential to be the “first line of defense” against financial abuse, by identifying the abuse at its outset, before the elder’s assets have been dissipated. The primary roles of the credit union are the protection of its members’ assets and the prevention of financial losses. Credit unions can take steps to protect elderly and vulnerable members from financial exploitation and fraud by training staff to recognize the types of financial scams, the red flags of potential abuse and what to do when fraud is suspected.
According to the National Center on Elder Abuse (NCEA), signs and symptoms of financial or material exploitation include but are not limited to:
The Financial Crimes Enforcement Network (FinCEN) issued an advisory in February of 2011 to assist the financial industry in reporting instances of financial exploitation of the elderly. The valuable role credit unions can play in alerting appropriate authorities to suspected elder financial exploitation has received increased attention at the state level; this focus is consistent with an upward trend at the federal level in Suspicious Activity Reports (SARs) describing instances of suspected elder financial exploitation. The advisory contains examples of "red flags" based on activity identified by various state and federal agencies and provides a common narrative term that will assist law enforcement in better identifying suspected cases of financial exploitation of the elderly reported in SARs.
In order to assist law enforcement in its effort to target instances of financial exploitation of the elderly, FinCEN requests that financial institutions select the appropriate characterization of suspicious activity in the Suspicious Activity Information section of the SAR form and include the term "elder financial exploitation" in the narrative portion of all relevant SARs filed. The narrative should also include an explanation of why the institution knows, suspects, or has reason to suspect that the activity is suspicious. It is important to note that the potential victim of elder financial exploitation should not be reported as the subject of the SAR. Rather, all available information on the victim should be included in the narrative portion of the SAR.