Nov 12, 2014 | aging investor, financial elder abuse, investor, senior citizen investor, senior investor
Welcome To AgingInvestor.com
Services from AgingInvestor.com are provided personally by Carolyn L. Rosenblatt and Dr. Mikol S. Davis jointly or individually by agreement.
We offer:
Webinars, customized or pre-recorded for you/your organization. Q & A included with live webinars (Pre-recorded, CFP Board accredited CE webinars now available on our website at your convenience).
Instructor led training workshops (ILT)- customized for your specific issues
Web-based instruction, constructed and designed with your preferred content. Interactive or non-interactive custom designs available. Work with us to develop your instructional design at your discretion or use our contracted designer for excellent results.
Policy Development Kits: get senior-specific policies in place with your “Policy in a Box” guidance. Step-by-step instruction, general parameters of a good policy, sample documents, and much more will help you get up and running. Best use is when combined with a consultation to help you implement what you develop for yourself or your organization.
![Aging Clients: How Financial Advisors Can Succeed in Difficult Conversations]()
Nov 4, 2014 | aging, aging investor, elder investor, elderly, financial elder abuse, senior investor
Financial advisors can protect their clients from financial ruin – and their financial firms from legal and compliance risk
Four critical things a smart and ethical financial advisor can do to make the client’s transition of power more likely to succeed
By Marie Swift for Guidevine.com
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It’s a fact of life. None of us are getting any younger. Life marches on and cognitive disabilities can set in. Financial advisors can spot dementia if properly trained. In addition, they can stop their older clients from harming themselves financially – and from claiming the advisor (or others close them in their personal life) had something to do with their undoing.
The legal and compliance risks to an advisor’s practice are very real. Forward-thinking advisors will ramp up their skills now.
Here are some tips from Carolyn L. Rosenblatt and Dr. Mikol Davis who together develop educational materials for financial advisors and speak at financial services industry conferences in a attempt to reduce elder abuse, and to also reduce legal / compliance risks for financial advisory firms and allied institutions. Rosenblatt is an RN, an attorney and a consultant on aging issues. Dr. Davis is a licensed, clinical psychologist with thirty-seven years of experience in the mental health field. More information about their work can be found at AgingInvestor.com and AgingParents.com.
WHAT TO DO IN THE EVENT OF THE CLIENT’S COGNITIVE DECLINE
Financial advisors may notice the warning signs ofcognitive decline in a client for some time. When they conclude that their aging client is getting to the point when he or she is unable to safely manage financial decisions any longer, the time will come when someone must take over for the client. Typically a responsible client has an estate plan and someone is appointed as the client’s successor.
One important step for the advisor is to find out if the client has indeed created an estate plan with a provision for a successor. It may be a successor trustee for a family trust or it may be an agent on a Durable Power of Attorney. Sometimes, for many reasons, even otherwise responsible people just don’t get their estate planning done. If the client has not accomplished the estate planing needed, this is a step the advisor can take that will protect both the client and the advisory firm. The advisor, with the help of their legal and compliance department can develop an institution-specific document that allows the client to appoint the appropriate successor to take his or her place for management decisions over the funds the advisor controls and to waive his or her right to privacy with that appointed agent. This is essential. The advisor can’t do the job of protecting the client without it.
Once the advisor is informed about the agent the client has appointed to take the reins in the event of his or her incapacity, the advisor needs to take the initiative for the next steps.
FOUR CRITICAL THINGS TO DO WHEN A TRANSITION OF POWER IS NEAR
Here are four critical things a smart and ethical financial advisor can do to make the transition more likely to succeed:
- Recognize and acknowledge that this transition of power is difficult for anyone.
“If the client, whom you may have known over decades, has been a powerful person in his or her life, and has been “the boss” in one way or another, giving up the status and position of being in charge will never be easy. Let the client know that you understand this,” said Rosenblatt.
“Communicate that your effort is to protect his hard work and the prudent decisions he has made over the time you have known him,” said Dr. Davis. “This acknowledgement lets him know that you respect that this is emotionally trying for him. The trust he has in you will help you both.”
- Set up a face-to-face meeting, if possible, with your client and his or her successor.
“The time should be chosen carefully,” warns Dr. Davis. “Be sure that there are no immediately stressful life events going on with your client that might distract from the importance of the meeting. An illness, loss of a spouse or family member, a divorce or other traumatic incident will absorb your client’s attention and could interfere with your effort to succeed.”
“Find out how your client is doing in general, and select the right time accordingly,” underscores Rosenblatt.
- Choose the place for a meeting carefully.
“Your aging client is already dealing with loss of control, probably in more ways than financially,” Rosenblatt continued. “If you have observed obvious changes in your client over time, there are likely other parts of his life that are a problem too.”
“Let him choose where to meet. Do what you can to ensure that he is comfortable and that there is privacy. Encourage him to tell you about his concerns and fears in arranging the meeting. Be an excellent listener,” advises Dr. Davis.
- Expect resistance and do advance planning on how to manage it.
“No one wants to think of herself as being too old to do what she has always done,” Rosenblatt said.
“No one will relish the idea of a difficult meeting in which she must acknowledge that she has to yield control over finances,” echoes Dr. Davis. “Vulnerability is the result.”
“If your client pushes back at the suggestion of a meeting, let her know that you understand why she might not want to have it but that it is going to be necessary, and soon. Set a date for follow up. Don’t push too hard, but gently persist,” Rosenblatt emphasized.
IN CONCLUSION
Aging clients will very likely need someone to assist with financial management eventually. This is something to plan for as an expected development, rather than a “maybe” or unlikely possibility. Financial advisors who are prepared for how to handle the potential transition of control can help to ensure their clients are protected from dangerous money decisions that arise from cognitive impairment. Astute financial advisors will be prepared to manage any transition as gracefully as possible.
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Oct 20, 2014 | aging, aging investor, diminished cognition, elder investor, elderly, financial elder abuse, investor, scammers, senior citizen investor, senior investor
As a financial professional, you may not be aware of what is going on in your elderly clients’ daily lives, but families sometimes find out about scammers who have victimized their loved ones. You could come across them too. An adult child of your client may mention a situation that is alarming or your clients may tell you themselves about this “great product” they’ve gotten. If it sounds odd, start asking questions.
Here’s an example:
According to the Waterloo Cedar Falls Courier, an adult daughter discovered that her aging parents were spending thousands of dollars on supplements to fix a wide range of health problems. The scammers were from Las Vegas based Leading Health Source, and they had taken advantage of the elderly couple’s vulnerability to their sales pitch. It might not have been so bad if they had simply sold the couple a reasonable amount of nutritional supplements. But over a period of 20 months Leading Health Source had ripped off the elders for more than $44,000, a sum they couldn’t afford.
This is the piece to which we, at AgingInvestors.com want you to pay the most attention. In this instance, the daughter took action. She went to bat for her aging parents, rather than doing nothing or considering it her parents’ problem.
Leading Edge was investigated after the daughter reported the large sum her parents had paid to them. The daughter had attended an event held by Iowa Fraud Fighters at Kirkwood Community College. Presumably, she learned there that she should file a complaint with the state Attorney General and she did so.
The outcome in this case was very good for the elders. The matter was settled, and the Attorney General’s office demanded that Leading Edge pay back everything the couple had paid to them. That meant getting a check from Leading Edge for more than $23,000 to start and having the remainder of the credit card charges reversed.
The Courier, source of this story reported that the Attorney General’s investigators found Leading Edge well aware that the people they were selling to in this case were easily manipulated. Their telemarketers’ handwritten notes indicated that the elderly woman involved had “memory” issues and that her husband had dementia.
What can you, the professional, just managing money or offering products to your aging clients learn from this?
First, note that memory issues and dementia in an aging couple is a setup for fraud and abuse. If you think your own client may have these issues, even a little, beware. You could be prosecuted if you proceed with transactions. If law enforcement is contacted or FINRA is involved, you will be scrutinized. It could be, in the above example that Leading Edge owners and principals didn’t know what their unscrupulous telemarketers were doing. Perhaps the telemarketers were motivated by a commission or other sales incentive and an easy opportunity presented itself with an easy sale. But the principals were held liable nonetheless. They either failed to supervise adequately or they looked the other way. They are consequently barred from doing business in Iowa.
The second thing to learn is that family of your client may be a very helpful asset to the ethical financial services professional trying to preserve capital for a client. Understand your client’s family relationships and whom to trust. When even a whiff of possible abuse happens, you can report it to the authorities. You don’t have to be right if you suspect something. You just have to be reasonable in what you think is reportable problem. It’s better to report it with the facts you do know and have it turn out to be a false alarm than to take the chance of not doing anything and have your client suffer the effect of theft and fraud.
Until next time,
AgingInvestor.com
Oct 4, 2014 | diminished cognition, elder investor, elderly, investor, scammers, senior citizen investor, senior investor
Two ruthless swindlers were arrested in New York for tricking an elderly woman out of her multi-million-dollar property in Harlem she had owned for over 40 years.
A home care worker bilked a frail elder out of her life’s savings of $350,000.
These stories keep coming up. Family members do it. Salesmen touting unsuitable annuities do it. Realtors collude with thieves and they do it. Even lawyers do it. They prey on unsuspecting or impaired elders to rip them off.
Financial elder abuse is a problem all across the world and it’s growing. We need to be aware.
My mother in law, Alice, is 90 and still very sharp. She would be hard to fool, but I know the right thief could probably do some harm if we weren’t watching closely all that goes on financially. At least she has the good sense to question something that sounds too good to be true. Here’s an example.
She got a check in the mail for $3800, legitimate looking, advising that she was the second place winner of a sweepstakes in Canada. She does play various sweepstakes. All she had to do, of course, was to deposit it and “pay the taxes” on her “winnings”. She was advised to contact her “claims agent”. No doubt, that professional thief would have done a great job convincing someone unsuspecting to deposit the check and send “taxes”. Of course the check is rubber and the money is gone before the elder finds out that the check has bounced.
Classic scam. Alice called the number and said, “How do I know you’re legitimate?’ The thief told her if she was suspicious, she should hang up. She did. She then called my husband, Dr. Mikol Davis, who did an internet search for the phony address and told her she had just thwarted a thief. Alice is with it enough to question the check. Millions of seniors with any cognitive impairment are not so able to question things like this.
What we know from research into Alzheimer’s Disease is that one’s judgment about financial transactions may be the first thing to become impaired when the disease is in the earliest stages. “Mild cognitive impairment” as doctors may call it, is not so mild when you think about the financial damage that can result. And the elder with this early warning sign of dementia may be living independently, paying taxes on time and otherwise appearing socially normal. For a time.
Professional thieves have certainly studied what makes elders vulnerable. They buy names of people who have entered contests like sweepstakes, and troll for the isolated and lonely ones who will talk to someone on the phone. The sweepstakes officials get paid for selling the lists and no one cares what the buyer does with them.
Elders are truly sitting ducks, easy prey. Isolation, confusion, forgetfulness, and fears about running out of money can all drive the susceptibility to entering into a “deal” with a clever scammer.
If you have an aging parent or loved one with any form of mild cognitive impairment, early dementia or other disease that affects thinking and judgment, here are seven basic things family can do to reduce the risks of ripoff.
1. Check in often. If your aging parent lives alone this is crucial. One of my clients at AgingParents.com emails her dad every day to check in. Others call every day or close to it. Aging parents may not think they need this but they do.
2. Ask to be a co-signer on the main bank account in case of emergency. Some aging parents will agree and some will resist, but ask regardless. It will allow you to do online monitoring of the account activity. A “new friend” who gets money from them is a huge red flag.
3. Have your parent sign a Durable Power of Attorney appointing a competent and ethical agent, which could be you, a sibling or trusted other. If cognitive decline happens, the agent can at least get the money out of the account and put into another safer one that the impaired elder can’t access. This is one way to stop the thieves who are looking for impaired elders. Nothing in the account, no gain for them.
4. Suggest having your parent use a licensed fiduciary to handle money if they don’t want you to do it. If there are issues of not trusting you, an objective professional can protect them from abuse. You might do research to find a reputable one for them. This is also a safe bet for elders you know with no adult kids.
5. Provide and encourage parents’ connection to others. Think of isolation and loneliness as two big risk factors in why elders get financially abused. If you can provide encouragement for them to get involved in activities, it will make them less likely to want to talk to a smooth, slick “friendly” con artist on the phone.
6. Monitor who comes into your parents’ home regularly. Even the most trusted housekeeper, gardener, caregiver or bookkeeper can be tempted beyond reason when their own financial circumstances change for the worse. Your parents are all the more at risk when they trust the familiar person, who can use trust to exploit them.
7. Do background checks on any home care helpers who are hired to work for Mom or Dad. The cost is modest, and you can find out a lot: bankruptcies, poor driving records, and of course, criminal convictions and civil cases. Licensed home care agencies may do background checks, but ask to be sure.
The ripoff artists out there are both clever and relentless, but we can stop many of their opportunities. Please don’t take your aging parents’ financial judgment for granted. It can erode almost without notice, even in the brightest and most accomplished elders.
Until next time,
Carolyn Rosenblatt
Dr. Mikol Davis
AgingInvestor.com
Oct 3, 2014 | aging, diminished cognition, elderly, scammers
Most days at I get a call from an adult child of an elder, asking me about shady dealings over a parent’s finances. Sometimes it’s the niece, grandson, or other family member the caller is worried about. Sometimes it’s the caller’s sibling whose actions are in question. And all the cases I hear about have something in common: red flags of elder abuse are present, but no one is taking any action to stop them.
For example, a 62 year old woman whose mother is 90 called and said she is worried because she lives at a distance from her mother and her niece who is caring for the mother won’t return her calls or emails. And she also told me that a step-brother is a stockbroker and has financial power of attorney over her mother.
That’s 2 red flags, and she was just warming up.
Most abusers are family members. Caregivers are next and professionals, like stockbrokers, lawyers, financial advisers and insurance brokers are next in line for frequency of abuse. I do all I can to educate and urge action by family members to stop abuse when it happens and when it’s suspected to get a closer look.
I recently saw a new publication from our government, designed to raise people’s awareness about financial abuse and what an agent should and should not do when acting as agent on a financial power of attorney document.
Elder abuse is a huge international problem, and it’s finally getting more attention from the Federal government, thanks in part to the Consumer Financial Protection Bureau. They came out with an excellent free little booklet to help folks understand how to handle someone else’s money when they get appointed as a Power of Attorney. It’s called Managing Someone Else’s Money: Help for agents under a power of attorney.
You can get it here: http://files.consumerfinance.gov/f/201310_cfpb_lay_fiduciary_guides_agents.pdf.
Here’s what I like about this booklet.
It’s clear. It tells you what you can and can’t do as an agent. If you’re interested in being honest, it gives your guidelines to keep it that way. On the other side of the question, unscrupulous agents use the paper as a license to steal. Unfortunately, no court is involved and no one is watching. They help themselves to an elder’s money, house, investments, and anything else of value and some seniors are left destitute. I believe that sometimes, education can help family members stop other family members from committing this abuse. They can also warn the elder who is living independently about the sneaky thieves who devise ways to get elders’ money that are not so obvious. The booklet warns about some common scams. Not everyone knows about these and they keep getting victims to give up money.
The booklet lists 10 scams. I’ve picked a few to reiterate here for you. Would you know about these if they were going on with your elder right now?
1. Relative in need. Someone pretending to be a family member or friend calls or emails and says they are in trouble and need the elder to wire money right away. And by the way, you don’t have to be frail and isolated to get one of these pitches. I got one myself recently. Someone had hijacked my sister’s email address and sent emails to all of her like named contacts asking to wire money to her in a foreign country. Didn’t work with me, but it does get people to wire money to thieves. If no one fell for the scam they would stop, but it goes on.
2. Fake government funding. The recipient gets an official looking letter from a pretend government agency offering help with housing, home repairs, utilities or taxes. Just give them your credit card info and you get the help. Vulnerable and low income seniors fall for these scams because they are worried about the very things the ripoff artists offer them.
3. Home improvement. Targeted elders who own their homes (can be easily found in public records) are approached with an offer to fix something. It can be a roof, a fence or in my mother in law’s case it was to clean the air ducts. They take money in advance, overcharge and do shoddy work, or don’t do the work at all. The trusting elder doesn’t have a way to pursue them, as they disappear.
The booklet is 23 pages and has two pages of resources listed a the back. Among them are Adult Protective Services, and where to get free legal help for seniors. I think they did a fine job on this. Maybe that’s not the way I would comment on a lot of other confusing or poorly written government efforts at educating the public. And they don’t teach you this stuff in school. My hat’s off to the CFPB.
If you have an aging parent or other loved one, or you’re curious because your aging loved one put YOU on the documents that will one day cause you to have to handle their money, check out the booklet for yourself. I’m happy to share the good resource with you. Yep, your tax dollars at work.
Until next time,
Carolyn Rosenblatt
Dr. Mikol Davis
AgingParents.com and AgingInvestor.com
