As people get on in years and perhaps experience cognitive decline, they may become vulnerable to elder financial exploitation: theft or fraud perpetrated by someone they know, even someone close to them. It may be a shady lawyer, accountant, caregiver or family member who drains their bank accounts, keeps their benefits checks or buys extra groceries or merchandise for themselves while running errands on the person’s behalf.
Construct financial guardrails
“So much of elder financial exploitation might be prevented if individuals as they age took matters into their own hands and set up guardrails of protection around their money,” says Marti DeLiema, research assistant professor at the University of Minnesota School of Social Work, and part of the team that created the free Thinking Ahead Roadmap website.
Technology can help construct such guardrails.
Thinking Ahead, cosponsored by the University of Minnesota and AARP, is based in part on in-depth interviews with 27 elder law attorneys, financial advisers, geriatric health professionals, caregivers and older adults themselves. It walks people through the steps of choosing a trusted financial advocate or financial power of attorney who can help organize finances and determine when the time is right to eventually shift money management to that fiduciary.
Prepaid Visa debit card
True Link Financial also tries to nip the problem in the bud, ahead of any potential fraud. For $10 a month, the San Francisco fintech firm supplies a prepaid Visa debit card that enables the cardholder or a family administrator to set limits on where it can be used and curbs how much the user can spend. You can also set limits on ATM withdrawals made with the card. Administrators can receive real-time alerts to track purchases and withdrawal attempts. True Link proactively blocks liquor stores, casinos and predatory merchants.
Of coures, fraud isn’t necessarily restricted to a single financial account. Tech companies such as Carefull and EverSafe offer services that can flag suspicious behavior across multiple accounts, including incidents they say banks often miss.