Financial Exploitation of the Elderly

Financial exploitation of elders is complex and, in some instances, accompanied by other forms of elder mistreatment. On this page find:

Incidence of Financial Exploitation

The U.S. has no national reporting mechanism to track the financial exploitation of elders, but in a 1998 study by the National Center on Elder Abuse, financial abuse accounted for about 12 percent of all elder abuse reported nationally in 1993 and 1994 and 30 percent of substantiated elder abuse reported submitted to adult protective services in 1996, after reports of self-neglect were excluded.[1]

A 2000 survey by the National Association of Adult Protective Services Administrators conducted for the National Center on Elder Abuse found that financial exploitation comprised 13 percent of the mistreatment allegations investigated.[2] Many experts in the field, however, believe that the level of elder exploitation may well exceed what has been reported to authorities and documented by researchers.

One NIJ-funded study of 2,000 community-residing elderly individuals in Arizona and Florida found that 5.6 percent reported being victims of financial mistreatment. The most common types of financial mistreatment were having someone steal or spend their money, sell or take their property, or forge their signature. The risk of financial mistreatment was higher for individuals who engaged in fewer social or other activities outside of the home (e.g., participating in social activities away from home, getting together with people who do not live in the home, going to the movies), had low self-control, were male and identified as a racial minority.[3]

Characteristics of Financial Exploitation

NIJ-funded researchers examined two sets of data to determine some of the differences between cases where an elderly person was the victim of financial exploitation and those where he or she was the victim of both financial exploitation and neglect or physical abuse, a combination referred to as hybrid financial exploitation.[4]

The researchers, who studied 54 cases in depth — 38 were financial exploitation alone, and 16 were hybrid financial exploitation — found that the characteristics and dynamics of the two types of cases vary depending on the type of exploitation involved. The data revealed several differences between the two types of cases.

The researchers identified two types of independence: physical and financial. Physically independent elders were able to care for themselves, could drive, and were cognitively intact and physically healthy. Financially independent elders had the financial assets to cover their needs and often owned their homes. Elderly victims who were physically and financially independent were more likely to experience pure financial exploitation.

Elderly victims experiencing hybrid financial exploitation tended to be financially independent but physically dependent. They had significant health problems, were unable to drive and were to some degree dependent on others for assistance.

Victims of hybrid financial exploitation were more likely than victims of pure financial exploitation to have:

  • Been victimized by a relative.
  • Experienced abuse multiple times over a longer period of time (123 months vs. 32 months for victims of financial exploitation alone without neglect or abuse).
  • Suffered a negative health consequence, financial loss, a disruption in social relationships, or some combination of these as a consequence of their victimization.

Based on the larger dataset of all reported cases in Virginia, the researchers identified a number of characteristics of the 472 victims of financial exploitation. These victims:

  • Were independent. Independent elders were 66 percent more likely to experience pure financial exploitation (without accompanying neglect or abuse) than the victims who were dependent.
  • Were not experiencing dementia or confusion. Elders who were not experiencing dementia or confusion were 29 percent more likely to experience pure financial exploitation than the victims who were experiencing dementia or confusion.
  • Had abusers who were not overburdened in providing social support. Elders with abusers who perceived that they had reliable social support were 88 percent more likely to experience pure financial exploitation compared to victims with abusers with overburdened social support.

The researchers also found that the 162 victims of hybrid financial exploitation were 81 percent more likely to experience hybrid exploitation when the abuser did not provide financial support to the victim, but the victim did provide financial support to the perpetrator.  

Financial Exploitation of the Elderly in a Consumer Context

An NIJ-funded study sought to determine the nature and extent of consumer fraud victimization and to identify risk and protective factors for fraud victimization among elderly residents of Arizona and Florida.[5]

Researchers found that nearly 60 percent of the 2,000 survey participants were targeted by at least one fraud attempt during the prior year. Approximately 14 percent of the study participants were fraud victims within the past year. The most common types of fraud were phony magazine subscriptions, prize scams, donations to nonexistent charities and retrieval of personal financial information under false pretenses.

Factors that consistently increase an elderly individual's likelihood of being targeted and experiencing financial fraud victimization include remote purchasing, low self-control and telemarketing purchases.

Respondents who purchased something in response to a telemarketing call from a company with whom they had not previously done business during the previous year increased their risk of becoming a fraud target by more than 200 percent and their risk of financial fraud victimization by more than 600 percent compared with those who had not made such purchases.

The study also sought to determine the extent to which residents were aware of and used their state-based fraud prevention programs. Overall, most participants were not familiar with their state-based programs.

Notes

[1] National Center on Elder Abuse. "The National Elder Abuse Incidence Study." Final report to the Administration on Children and Families and Administration on Aging, U.S. Department of Health and Human Services, Grant No. 90–AM–0660, 1998.
23(4): Summer 2002. Washington, DC: American Bar Association.

[2] Teaster, P.B. A Respon​se to the Abuse of Vulnerable Adults: The 2000 Survey of State Adult Protective Service. Washington, DC: National Center on Elder Abuse, 2003.

[3], [5] Holtfreter, Kristy, Michael D. Reisig, Daniel P. Mears and Scott E. Wolfe, “Financial Exploitation of the Elderly in a Consumer Context,” Final report to the National Institute of Justice, grant number 2010-IJ-CX-0008, March 2014, NCJ 245388.

[4] Jackson, Shelly, Thomas L. Hafemesiter, Financial Abuse of Elderly People vs. Other Forms of Elder Abuse: Assessing Their Dynamics, Risk Factors, and Society's Response (pdf, 608 pages), Final report to the National Institute of Justice,  grant number 2006-WG-BX=0010, February 2011, NCJ 233613.

Date Modified: May 12, 2015