1 in 5 Senior Citizens Fall for Financial Scams
NEW YORK (TheStreet) -- Seventy-three-year-old Charles S. Bacino lay dying in a hospital bed in Las Vegas, on Nov. 27, 2012, when the man he referred to as his "financial affairs manager" stopped by for a visit to talk about his investments. Even as a morphine drip was working to soothe the pain of Bacino's terminal pancreatic cancer, his adviser persuaded him to invest $82,000 in notes of a cocoa and banana plantation in Ecuador.
"My dad gave him keys to the house to get his checkbook," says his daughter Shari Snow, who sued the adviser in September. Snow, who is still trying to retrieve the money, says that less than a month after that hospital visit, her father was dead and the whereabouts of his money was a lingering mystery.
Law enforcement officials and advocates for the elderly are increasingly alarmed at the rising incidence of financial abuse of senior citizens. The Investor Protection Trust, an investor information organization, said in 2012 that one out of every five citizens over the age of 65 had been victimized by a financial scam. People over 60 made up the largest age group reporting fraud to the Federal Trade Commission last year: 27% were 60 or older, up from 22% in 2011.
While elder financial abuse is in some respects nothing new in the annals of fraud, the aging of the baby boom generation and Americans' increasing longevity are coming together in a perfect storm that could cause the problem to skyrocket. A 2010 survey by the Metropolitan Life Foundation estimated that victims of elder financial abuse lost at least $2.9 billion in 2010, up 12% from 2008. Experts say it will only get worse."It used to be that they were more [targets of] petty thieves," says Debra Speyer, a Philadelphia lawyer who has specialized in elder law since 1990. "But now I'm finding a lot more people are being wiped out of everything." The swindles are carried out by family members, caregivers and strangers, with theft by family members ranking as the most frequent problem, according to the National Adult Protective Services Association. Presenting the ultimate quandary to seniors is that advocates offer various "must follow" advice that is often contradictory.
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