Many don’t report incidents if it involves someone they know. Data shows friends, family or caregivers steal $20.3 billion annually from older adults — 72% of total losses. And only $7.8 billion of stolen funds are reported.
Older Americans lose $28.3 billion annually to elder financial exploitation, but many don’t report the incidents if it involves someone they know, according to a new report from the AARP. The organization said it used a first-of-its-kind approach to gather data from several sources on consumer-reported losses while integrating estimated unreported losses for its report, “The Scope of Elder Financial Exploitation: What It Costs Victims.”
Elder financial exploitation is a growing program, doubling during the pandemic, according to AARP. Many victims lose a significant part of their retirement savings, leading to family caregivers to potentially incur costs of care. The financial industry also loses billions of dollars each year, and taxpayers bear an increased burden in the form of programs and resources necessary to assist financially devastated victims, according to the national association.
The sources the AARP tapped include the Consumer Sentinel Network, the FBI’s Internet Crime Complaint Center and the Consumer Financial Protection Bureau’s Elder Financial Exploitation Suspicious Activities Reports database. The AARP collaborated with NORC at the University of Chicago to provide comprehensive and updated analysis of elder financial exploitation losses.
Approximately 12.5% of older adults victimized by family or caregivers report them. In contrast, 67% of victims of stranger-perpetrated incidents report those incidents.
“While strangers often rely on quick and irreversible transactions, such as gift cards or wire transfers, perpetrators who know the victim are more likely to gain direct access to their victims’ bank accounts,” said Jilenne Gunther, national director of AARP’s BankSafe Initiative and lead author of the report. “The keys to stopping this growing problem are consumer education, frontline employee training and strengthened technology to flag suspicious activity.”
Among the other recommendations from the report were to provide federal funding to states to mandate and standardize data collection procedures of adult protective services, and to tailor evidence-based intervention strategies based on perpetrator type.
The analysis, according to the AARP, provides a starting point for further work and underscores the need for data development.
“To better prevent the financial exploitation of older adults, we must understand the problem in full and act on that understanding,” the report concluded. “An ever-increasing understanding of EFE will enable the development of interventions that can protect older adults, and society at large, from the seismic impacts of this pervasive problem.”