According to a recent article by the AICPA, it is estimated that one in ten elderly people in North America have been victims of financial abuse.  This abuse has resulted in more than $2.9 billion in yearly financial losses.  Due to the changing demographics in North America, elder financial abuse is expected to intensify in the coming years.  By the year 2031, one in four people living in North America will be over 65 years old and will control 70 percent of the wealth in North America.  “Crime of the 21st century,” the “silver tsunami” and “the perfect storm” are some of the terms used to describe elder fraud.  Elder financial abuse is a serious problem and is growing at an alarming rate. ¹  With increasing wealth and decreasing cognitive ability, aging Americans are ripe targets for financial abuse.
Profiled below are three example scenarios involving instances of elder financial abuse.
Scenario One:
A caregiver was given power of attorney (POA) for a 96-year old resident of a nursing home. The family members were living in various states, so the POA was given to a longtime family contact at the nursing home. The family attorney, on a surprise visit to the nursing home, noticed a bank statement lying open on the book shelf.  Suspicious activity on the bank statement lead to further investigation and over $200,000 of misspent funds on trips to Las Vegas, and various restaurant and clothing store purchases were subsequently discovered.
Scenario Two:
The founder of a highly successful independent oil and gas company died and left total control of his estate to his 85-year old widow. Again, various family members were dispersed in different locales. The oil company’s bookkeeper/administrative assistant retained her position with the Company. Without adequate oversight, the bookkeeper began to disburse excessive sums of money for her benefit – her children’s education, family vacations, autos and trucks, etc. This was discovered only after one of the daughters happened to look at some of the bank accounts online.  After careful and detailed analysis, over $500,000 in assets had been misappropriated.
Scenario Three:
An elderly man in his nineties lost his long-time wife and was no longer able to care for himself in his own home, but he did not wish to leave for a nursing home. One of his sons moved into the home, and shortly thereafter, he proceeded to have his father’s will changed for his benefit. The original will had been in place for over 50 years, leaving the estate equally to his five children. The son hired an attorney, who knew very little about the family history, to draft the new will. This plan unraveled when an attorney and long-time friend of the family was interviewed, and in a signed statement, documented that “mental capacity” was a contributing factor for the unwitting patriarch.
These are just a few examples of actual abuses that occurred in our area involving the elderly. Many cases of elder financial abuse go unnoticed and unresolved (only 1 in 44 cases of elder financial abuse is reported).  Abusers may be found among friends, acquaintances, total strangers, professional con artists, paid caregivers or even a family member.  Prudent planning and care upfront would have made the above scenarios unlikely to occur. Identifying and preventing the different forms of elder financial abuse often falls to the responsibility of CPAs, attorneys and other professionals.
As CPAs, helping safeguard the elderly from financial abuse as they age and experience health problems is one of the most important and meaningful things we can do for them.  Providing education and increasing overall awareness are keys to assisting clients in understanding these schemes and in identifying and preventing financial elder abuse.
The following are red flags for elder financial abuse:

  • Unusual withdrawals from bank and investment accounts and frequent ATM withdrawals
  • New associations with strangers (a new best friend)
  • Signing legal documents which the older person doesn’t understand
  • Suspicious signatures
  • Losing control of mail
  • Suspicious activity or implausible explanations of expenditures given by the elder or caregiver
  • Adult children living at home who are unemployed

Many people believe wrongly, because of their wealth, education or family ties, they are exempt from being victimized by elder financial abuse.  Falling victim to this type of abuse is not necessarily linked to a person’s education level, but depends on their level of vulnerability.  With age, financial decision making abilities begin to decline.  Additionally, the elderly are often lonely and predictable, thus, easy targets for the fraudster and con-artist armed with an almost endless variety of scams, cons, and frauds.
The best way to prevent elder financial abuse is to stop it before it starts.  As your trusted advisor, one of the most valuable and essential services we can offer is to help prevent financial abuse.  We want to do what we can to make our clients less-inviting targets for potential fraudsters.  Contact our office for more information on how to mitigate the risks of financial elder abuse, how to identify the types and signs of abuse, and ways to prevent it before it starts.
To learn more about Financial Abuse of the Elderly, call Justin Ricou at 429-2046 or email at, call Roderick Williams at 429-2064 or email at For more information on the services available to you by Heard, McElroy & Vestal, LLC, call our Shreveport office at (318) 429-1525, our Monroe office at (318) 388-3108 or visit
¹ Elder Finanical Abuse Trends
Author: Justin Ricou, CPA, Audit Manager
Author: Roderick Williams, CPA, Tax Manager