Taking Care: Elder Financial Exploitation

Wed, 05/20/2020 - 8:30am

Story Location:
31 Chestnut Street
Camden  Maine  04843
United States

About this blog:

  • Sarah Ruef-Lindquist, JD, CTFA

    Sarah believes sound, thoughtful planning is a gift we give ourselves, our families and our community.

    She is a lawyer and seasoned non-profit executive who has worked with dozens of organizations, individuals and families as a philanthropic advisor and senior trust officer. She holds the Certified Trust and Financial Advisor certification and FINRA Series 7 and 66 registrations through Commonwealth Financial Network. Sarah and her husband live in Camden. The Financial Advisors of Allen and Insurance Financial are Registered Representatives and Investment Adviser Representatives with/and offer securities and advisory services through Commonwealth Financial Network, Member FINRA/SIPC, a Registered Investment Adviser. Allen Insurance and Financial, 31 Chestnut Street, Camden, ME 04843. 207-236-8376.

The cases of financial abuse targeting the elderly are increasing. A February 2019 article on AARP’s website cited a four-fold increase in suspicious financial activity involving elders between the years 2013 and 2017 as reported by the Consumer Financial Protection Bureau. https://www.aarp.org/money/scams-fraud/info-2019/cfpb-report-financial-elder-abuse.html

We read almost daily about the topic of elder financial abuse. Often perpetrated by family members or caregivers, and even less often reported, the elderly are particularly vulnerable to this kind of crime. In addition to betraying trust and depriving an elder person of rightful agency over their property, elder financial abuse often thwarts the intent of the victim as to the ultimate beneficiary of their property, be they family, a loved one or a charitable cause. It is financially and emotionally devastating, and may contribute to higher mortality rates. [i]

This kind of abuse is perpetrated at all socio-economic levels. Cases involving ultra-wealthy individuals tend to get the most media attention. When a charity had understood there was it be a gift from a donor following their death, it can put a charity in the difficult position of having to decide whether to challenge an estate plan, incur legal fees and unwanted publicity in asserting their rights as beneficiaries of that estate.

In the summer of 2019, a superior court jury unanimously awarded the Portland Museum of Art more than $4M, including punitive damages, in a case that highlighted the undue influence that caregivers can impose on their patients, threatening the charitable intent of those patients.

https://www.pressherald.com/2019/07/22/museum-wins-4-6-million-in-lawsuit-over-benefactors-will/

That decision was reaffirmed by the state’s highest court in May of 2020.

https://www.pressherald.com/2020/05/05/portland-museum-of-art-wins-appeal-over-disputed-bequest/

The museum brought suit after a donor, Eleanor Potter, died after changing her will to leave substantially all of her estate to her caregiver, Annmarie Germain. Potter had within the prior year created an estate plan through a different lawyer, leaving the bulk of her estate to the Museum.

The Museum was put in the unenviable position of having to challenge the will and assert that the caregiver had abused her position and unduly influenced Potter to dramatically change her estate plans to give most of her wealth to Germain. The unanimous jury verdict finding that Germain had coerced Potter into changing her will was upheld on appeal.

The pandemic may have an acute isolating effect on those who by virtue of their age or infirmity are already vulnerable, and maintaining contact with those who would help to create a buffer between them and the unscrupulous is challenging in the era of self-isolation and quarantine. We have the opportunity to help those neighbors, friends and family members by maintain regular contact with them and paying close attention to any indicators of abuse, such as unusual expenditures or transfers of money, sudden changes in financial or estate plans, or neglect of self-care. If you suspect that someone is the victim of elder abuse in Maine, contact Adult Protective Services, www.maine.gov/dhhs/oads/aps-guardianship/how-to-reporthtml.

[i]Burnett J, Jackson SL, Sinha A, Aschenbrenner AR, Xia R, Murphy KP & Diamond PM. Differential Mortality across Five Types of Substantiated Elder Abuse. Journal of Elder Abuse and Neglect, 2016; 28:2, 59-75