If It's Not There, You Are Not Looking
Politics aside, there is no doubt that some politicians like to "throw the baby out with the bathwater" when it comes to the regulatory burden on banks for self-political gain. True, there is regulatory burden that is excessive, costly, and of no real value; however, there are also regulatory initiatives that serve to benefit our society. One of these areas is Suspicious Activity Reporting and, in particular, for purposes of this newsletter article, Elder Financial Abuse.
While there are other areas of Suspicious Activity Reporting that are of substantial value because they result in protecting our personal safety or rescuing individuals from human trafficking there are other areas to consider. Elder Financial Abuse is so widespread and often so easy to spot. I often say if you don't have examples of this in your SARs filed for the year, you aren't looking.
Elder financial abuse is generally defined as using an elderly person's money or assets contrary to their wishes, needs, or best interests, for personal financial gain. I guess elder financial abuse is just one of my soapbox issues. It is generally perpetrated by those closest to the elderly person – their own family members including children and grandchildren; or companions; or caregivers - all taking advantage of a vulnerable elderly person for personal financial gain.
The excuses of the elderly financial culprit are numerous – feeling justified for taking what is rightfully theirs, a sense of entitlement, wanting to get to the assets before other family members do, not wanting the assets to be liquidated for medical or nursing home expenses, etc.
The uses of the funds taken are numerous as well – substance abuse, gambling debts, financial problems. Then there are the easy signs to spot, the elderly person in nursing home whose account has $5,000 in transactions a month to the liquor store; or huge building supply transactions when everyone knows the elderly person's son is building the largest house in town. Then bringing to your financial institution, the older person with obvious signs of dementia to have witnessed a deed, will, or POA.
So, what do you do when a financial institution employee sees evidence of Elder Financial Abuse? As a BSA Officer, when the evidence is presented, file a SAR as per regulatory guidelines. Adult Protective Services and Reporting for your given state can provide additional guidance as your next step in the process.
That victim today could be your parent or one day you. If you don't see elder financial abuse at your financial institution, you're just not looking.