According to the 2014 Safeguarding Our Seniors study from Allianz Life, elder financial abuse is an under-reported and misunderstood issue that is likely to get worse as America’s population ages.
The study of more than 2,000 Americans, both potential victims (ages 65+) and other adults (ages 40-64), found that misconceptions persist about the most likely sources of abuse, and the financial impact on victims.
For the purpose of the study, Allianz defined elder financial abuse as the unauthorized or improper use of resources of an elder family member or friend who is 65 years or older for monetary or personal benefit, profit or gain.
Only 5 percent of elders in the study said they have suffered financial abuse. This is a relatively small number and is likely an underestimate because some seniors might not self-identify or report abuse, says Allianz.
However, nearly one in five (19 percent) of adults age 40-64 reported they have an older friend or family member who has been a victim in the past. Of this 19 percent, 55 percent said the victims did not report the financial abuse.
The study also highlights a lack of awareness about the sources of elder financial abuse, says Allianz. When asked where the biggest threats come from, the majority of all respondents rated telemarketing as the most likely source of abuse followed by Internet scams and U.S. Mail solicitation.
However, of those elders who have reported experiencing financial abuse, 52 percent said a family member, friend or caregiver was the source. Just 22 percent said a stranger committed the abuse.
For the victims, the study found an average financial loss of about $30,000, and more than 10 percent of victims said they suffered losses of $100,000 or more.
To combat this, Allianz Life has created educational programs and materials for financial professionals and consumers regarding elder financial abuse. The firm also created a volunteer program that sends employees to senior centers to educate and encourage discussion on the topic.
“As America’s population gets older, the number of seniors with age-related cognitive impairments naturally is expected to grow,” said Walter White, Allianz Life president and CEO. “Greater awareness about the frequency of elder financial abuse will foster more discussion about ways to keep our seniors safe from financial exploitation.”