Washington – Today, Senate Special Committee on Aging Chairman Herb Kohl convened a hearing on combating the growing problem of financial abuse of older Americans.
“Over the years, I’ve seen our nation take great strides to combat elder financial abuse – from the passage of the Elder Justice Act to the creation of a background check system for nursing home employees,” Kohl said. “It’s time to build on our efforts to remedy this invisible epidemic and break the cycle of stigma attached to this horrible crime.”
According to a recent survey by the Investor Protection Trust (IPT), more than seven million older Americans – one out of every five citizens over the age of 65 – already have been victimized by a financial scam. In addition, a 2011 MetLife study found the annual financial loss by victims of elder financial abuse is estimated to be at least $2.9 billion dollars, a 12 percent increase from the $2.6 billion estimated in 2008.
According to a new Government Accountability Office (GAO) report made public at the hearing, elder financial exploitation is a large and growing problem that “calls for a more cohesive and deliberate approach.” In addition to recommending the development of a clearly articulated national strategy for addressing the problem, GAO called on the Consumer Financial Protection Bureau to help “correct banks’ misconceptions about the impact of federal privacy laws on their ability to release bank records” to Adult Protective Services and law enforcement agencies investigating suspected cases of elder financial exploitation.
GAO also recommended ways for the Department of Justice, Department of Health and Human Services and Federal Trade Commission to help reduce elder financial abuse.
Among the witnesses at the hearing was Frank Abagnale, who gained fame as the subject of the film “Catch Me If You Can” and now works to educate the public about how to avoid being the victim of scams and fraud. During the hearing, Abagnale recommended the following to seniors to protect their identity:
• Semi-annual reviews of credit reports;
• reconciling bank accounts in a timely manner;
• being suspicious of calls, e-mails or letters asking for any personal information;
• and, avoid giving out Social Security numbers.
Paul Smocer, president of BITS, the technology policy division of the Financial Services Roundtable, testified that his organization had formed an Elder Working Group that will be concentrating on creating a training outline for financial institutions to help employees better recognize and react to suspected elder financial abuse, and on developing a public awareness and education program on elder financial abuse that would be made available to all financial institutions.
“The financial services industry is a key part of the circle protecting older Americans from financial fraud and exploitation,” Smocer said. “When employees observe signs of potential exploitation, they can work with families, caregivers, social service agencies and law enforcement to prevent, detect and help investigate and prosecute the individuals who engage in fraud.”
The GAO report can be found at:http://www.gao.gov/products/GAO-13-110