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Financial Exploitation of Elders: Stopping the Abuse

Good morning, Mr. Chairman, Senator Mikulski and Members of the Committee. I am Lee Hammond, a member of the AARP Board of Directors. AARP has long been engaged in efforts to deter financial fraud – the fastest growing form of elder abuse. The greatest hurdles to successful prosecution of these crimes are getting the cases reported to law enforcement, having them thoroughly investigated, and obtaining timely and appropriate prosecution.

Financial exploitation has many disguises, causes, and forms of expression. But its common thread is an effort by unscrupulous persons to extract money and resources through a variety of devious means from unsuspecting and often vulnerable individuals. The incidence and impact of exploitation are difficult to estimate because:

  • there is no national reporting mechanism,
  • cases are often not reported,
  • definitions vary, and
  • the crimes are difficult to detect.

In the 2000 survey of the National Association of Adult Protective Services Administrators for the National Center on Elder Abuse, financial abuse or exploitation comprised 13% of the allegations of mistreatment that were investigated. Regardless of the amount of exploitation detected, virtually all observers agree that more happens than is brought to light, and any exploitation is too much.

While numerous types of activities constitute elder financial abuse, all have the same characteristic – improper use of an older person’s assets. But these activities go far beyond what most of us would consider merely "improper." Perpetrators employ deceit, forgery, coercion or undue influence for personal gain.

AARP is addressing this problem through programs that educate members, families, professionals and potential victims. Some AARP initiatives include:

AARP Daily Money Management, a program that helps older persons who are losing their ability to handle their financial affairs find someone to help them manage their money.

Financial Education Projects which expand financial awareness and enable participants to evaluate the trustworthiness of supposed advisors and experts.

Colorado Elder Watch protects older adults from the financial exploitation of telemarketers and other forms of identity theft scams.

Maryland Project SAFE is a coalition wherein AARP joined the Maryland Attorney General, the Bankers Association and the Department of Aging to encourage banks to report, and state officials to investigate and prosecute, instances of financial exploitation.

AARP Campaign Against Predatory Lending advocates legislative reform, pursues precedent-setting litigation and offers education to older homeowners regarding what to watch for when borrowing against the equity in their homes.

AARP Consumer Universities offer presentations by leading local experts on how to avoid being exploited in the financial marketplace, in one’s home, or by false advisors.

Legal Clinics and Attorney Training Seminars provide expert lawyers or housing counselors to examine loan applications to see if owners may be exploited by the loan terms.

Use of the AARP Media, including "The Bulletin" and "AARP The Magazine," enables many persons to be educated about financial exploitation through the articles featured.

Research by the AARP Public Policy Institute (PPI) on consumer financial and fraud issues includes deceptive or fraudulent preneed funeral and burial agreements, identity theft, and the regulation of home improvement contractors and subprime mortgage lending.

AARP regards its multifaceted effort against the financial exploitation of older persons as a valuable way to equip consumers, families, professionals and vulnerable elders to recognize signs of potential abuse. The goal is to enable them to detect, prevent, or intervene before financial crises arise.

We make information about all of our programs, services and research available online, in print media or both.

AARP appreciates this opportunity to share some of our financial abuse education and prevention activities with the Committee and looks forward to working with you to pass legislation, like the Elder Justice Act (S. 333), to provide a comprehensive national approach to elder abuse prevention. Thank you.

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