Feb 16, 2015 | aging, diminished cognition, elderly, financial elder abuse, scammers
You’d think that after all our vets have sacrificed for our country that somehow slimy manipulators wouldn’t go after them specifically. But, sadly, vets are prime targets for so called “veteran’s advocates”, whose objective is to get their money. Here’s how they work:The objective is to sell vets annuities, which tie up a person’s money for years and years. Annuities of this kind are usually not at all suitable for an aging person. The seller, a company owned or backed by an insurance company, offers veterans a free lunch “educational” seminar. An insurance salesperson is the front for this presentation. They go after elderly residents of retirement homes and assisted-living facilities and convince them that they can get free Aid and Attendance pension benefits offered by the U.S. Department of Veterans Affairs.
These benefits do exist, but no one who is wealthy qualifies for them. The vets at the seminar are persuaded to “reposition their assets” in order to apply for the benefits. Unwitting senior veterans are sold annuities so that they can qualify. Of course that generates handsome commissions and profits for the insurance agent and insurance company.
The insurance companies and their agents selling the annuities go after wealthy seniors in expensive retirement facilities, because people who are truly qualified for Aid and Attendance have no money. They induce the senior to put large amounts of money into an irrevocable trust so they appear poor and can thus apply for free Aid and Attendance.
The wealthy senior vets who get taken by these scammers would never qualify for Aid and Attendance anyway, as one must be low income and with very limited assets to be eligible. Buying annuities does not fix that.
A prominent attorney has now filed a lawsuit against one of these insurance companies and the agent who held himself out as a volunteer for veterans when he was really a salesman. Fraud is alleged in the lawsuit, filed in Riverside County Superior Court in CA. We at AgingInvestor.com hope the case is successful.
How do these slick salesmen who outright lie to senior vets keep getting away with these schemes? The annuity sale scams are a problem nationwide. Victims of financial elder abuse rarely report the abuse. They are elderly, get overwhelmed with the vicious battle the insurance companies will put up to defend their actions and they don’t want to do it.
If you would like to do your part to warn your aging clients or family members about these vet-targeted annuity scams, please send out emails or letters to them and warn them to be alert to the problem. Get your free sample email or letter form from AgingInvestor.com by clicking HERE. Information is power and implementation of this information can protect your clients.
Until next time,
Carolyn Rosenblatt, RN, Elder law attorney
Dr. Mikol Davis, Psychologist, Gerontologist
Feb 13, 2015 | aging, aging investor, elder investor, elderly, financial elder abuse, investor, scammers, senior citizen investor, senior investor
When Laura called me at the urging of her own financial advisor, she was in a crisis. Her father, Jack, age 95 lived in another state and was in a nursing home. She and her sister were worried about a problem: their brother Robbie was taking advantage of their dad and no one was stopping him.
Robbie had been sponging off of Dad for years, Laura told me. She knew Jack probably had dementia, and she had been appointed his Power of Attorney agent, but the transition had not happened yet for her to take over his finances. Robbie had flown out to see Dad from the state where Robbie lived. He took his frail father to Jack’s financial advisor and had his Dad ask the advisor to give Dad a cashier’s check for $50,000. The advisor knew that his client was being manipulated into asking for the money but he gave it to Jack anyway. It was not as if Jack was extremely wealthy. He had limited funds in the account.
Then Jack, with Robbie prodding him, asked his advisor to give him a debit card for his cash management account. The advisor knew full well that Jack’s money could go out the door and into Robbie’s pocket. He decided to deal with the potential abuse by “dragging his feet” for three months. He knew Laura and knew that she was Jack’s agent on his legal documents. He called her describing the call as “on the Q.T”and told Laura that he “had” to comply with the request for the debit card. Laura insisted as the power of attorney that the card should be mailed to her. After she got it, I advised her to destroy it.
The estate attorney who had prepared Jack’s trust knew that Laura should take over her position as Jack’s successor, but he failed to urge her to do so right away. He also failed to give her enough direction about how to accomplish this so she could stop any other actions by Robbie to get Jack’s money. This was one professional failure—the lawyer did not recognize the urgency nor try enough to stop elder abuse.
When I met with Laura, I instructed her exactly how to get the needed doctors’ reports on Dad to meet the requirements Jack’s trust had in it that would permit her to take over responsibility for him. She did so at my urging, right away. I encouraged her to immediately give Dad’s advisor a letter instructing him to cease any transactions initiated by Jack as Jack did indeed have dementia and the doctors had verified that he was no longer capable of managing his affairs. She did that, too. It had also come to light that Robbie had gotten Dad to transfer funds into an account to which Robbie had access and that Robbie had already nearly drained that account of another $30,000.
I sat with Laura and helped her draft a firm letter to Robbie letting him know that the end had come for manipulating Dad and that she was now in charge. He was furious! Ugly emails from Robbie and threats followed. The saga did not end there, but with help, Laura was able to stop any further financial abuse of her father.
The second and most distressing failure of a professional in this true story was the action by Jack’s financial advisor. He did not seem to have any idea of what to do to stop elder abuse that he admitted was going on in dealing with his client
The takeaway here is that every advisor who sees potential elder abuse can and should do much more to protect an elderly client from this kind of manipulation. Every professional has to give up being a slave to the outdated notion that you always have to do what a client says even if the client is seriously impaired. That impaired person is not the client you signed up and you must address this problem.
Learn 5 things every professional should do when you suspect financial abuse by clicking HERE for your free tip sheet.
Until next time,
Carolyn Rosenblatt, RN, Elder Law Attorney
Dr. Mikol Davis, Psychologist, Gerontologist
Feb 6, 2015 | aging, diminished cognition, elder investor, elderly, financial elder abuse, investor, scammers, senior investor
Competition for clients has always been there, but as investors age, something you might not have anticipated can happen. The vultures are out there. Competition with you for their invested assets can become an increased threat when an older client’s judgment is compromised. With impaired judgment, they might fall for the “free meal” seminar, a device to get them to buy an inappropriate product.
An older client who has always behaved a certain way about her investments can go through changes because of cognitive decline. You have absolutely no control over this process and in fact, you may not even notice it initially. Cognitive impairment can come on very subtly at first. What it can do over time is to cause your client’s ability to make good judgments about finances to go downhill.
A person who is actually ok financially may start to worry unreasonably that he is going to run out of money. Or a spouse gets ill and the costs of care skyrocket, making your client think he needs to do something fast to get a high return on his investments. There are a lot of slick salesmen out there who know this and count on it. They are the first ones to offer your client a free meal and a so-called “financial education seminar”.
According to FINRA research, 64 percent of those responding to a survey of people age 40 and over had been invited to an “educational” seminar with a free meal offered. FINRA, the SEC and state regulators conducted more than 100 examinations involving free-meal seminars.
They found that in half of the cases, the sales materials contained claims that appeared to be exaggerated, misleading or otherwise unwarranted. And fully 13 percent of the seminars appeared to involve fraud.
These highly polished and sleazy sales people are more than happy to tell your client that they can do a lot better for the client than you are doing with your old, conservative and safe investment strategy. They dress well, have engaging personalities and are looking for someone who is fearful or easily manipulated. That could be your client. No matter how educated, smart or experienced your client is, anyone can suffer from loss of cognitive ability. Aging investors may not be as sharp as they were in a younger day, due to memory loss or other issues. The early warning signs of memory loss also suggest erosion of financial judgment. That can lead to impulsive purchases and lack of financial judgment about the risks.
What can you do about this? You have an opportunity to do a campaign with all your older investors which can enhance your image, increase the frequency of contact with them and educate them in the process. It could be a series of emails or personal letters. Remember that FINRA has issued a warning to all investors to be wary of the free meal “educational” seminar. You are the good guy or gal, bringing them this important information from regulators who want to protect them. The body of your email or letter can contain this information:
For every consumer, note these points FINRA wants you to keep in mind before you attend any “investment” or “financial education” seminar, especially with a free meal.
1. Investment seminars are intended to sell you something. Their purpose in not merely educational.
2. Beware of the persuasive effect of a high end venue, an expensive meal and a smooth, well-dressed presenter. These are collectively designed to impress you, but it does not mean that the opportunity being pitched it right for you.
3. Find out who is really sponsoring the event. At times, insurance companies, mutual funds or other companies offering their products are behind the pitch, financing the event and expecting that the speaker, who could be someone you know or recognize, will use the event to drive sales of their products.
4. You can use FINRA’s Broker Check (800) 280-9999 to see if the presenter is licensed to offer financial products. If the sponsor is an insurance agent, find out if he is licensed through your state department of insurance or the National Association of Insurance Commissioners. You can find out information about the one offering products for sale through your state’s securities regulator or the North American Securities Administrator’s association at (202) 737-0900.
Feel free to copy this right into a letter to your clients today. Vary it with your own words and headline. Anyone age 50 and up would be a good candidate to receive it.
Stay in communication with your aging clients.
Let them know you are concerned about the prevalence of these offerings by supposedly qualified people and ask if they’ve been solicited to attend any of them. If they tell you they want to go to a seminar, dig deeper. Ask questions. Offer to check out the presenters. If you step up the frequency of contact, particularly with an automated system of emailing your clients, you can only enhance the relationships you have with them. And in the process, you can not only build loyalty but perhaps save some of them from being seduced away from your responsible management by educating them about potential financial danger.
We encourage you to comment and share your own stories so that we all can become better informed and educated about new scams and ways to protect our older clients and family members.
Carolyn L. Rosenblatt, R.N., Elder Law Attorney & Dr. Mikol Davis, Psychologist, Gerontologist
AgingParents.com & AgingInvestor.com
Dec 19, 2014 | aging, aging investor, diminished cognition, elder investor, elderly, financial elder abuse, investor, scammers
When your aging client has contact with you, consider it an opportunity to educate them about more than the status of their portfolio you manage. Your client’s efforts to maintain financial safety can be thwarted by clever scammers who are constantly devising new ways to take advantage of them. You are in a perfect position to help keep them informed about financial abuse and the latest information on tactics scammers use. Don’t make it someone else’s problem. Make it part of your services.
Take for example the “grandma I need help” scam. My 92 year old mother in law told me about this one. Someone actually had the nerve to try it with her, but she’s smarter than they were and it didn’t work. However, one of her friends did fall into the trap. Somehow the scammers got a list of phone numbers of many of the seniors living in the nicely appointed neighborhood in her retirement community. They get a young man to call from their list of numbers and say “Grandma?” when a woman answers. If she thinks it’s her grandson, she’s bait. The thief then says he’s in trouble, with some made-up some story to get her to worry about him. He then asks her to wire money right away to get him out of this jam. The unsuspecting do it. And get taken.
A newer scam is the gift basket trick. Again, the older person’s phone number and address are known to the thieves. They call the potential victim to be sure he’s home and then tell him they’re Express Courier or any other name and they have a gift delivery. Will he be home in the next hour? If the victim says “yes, I’ll be here” an official looking truck with a courier name on it pulls up within the hour, and the delivery man hands the victim a lovely basket of wine and flowers. The trap is in the delivery man then asking the victim for payment for a “delivery fee’’ because the basket has alcohol and had to be hand delivered to an adult rather than left on the doorstep. Or so they say. The fake courier insists on a credit card payment rather than cash, even if the fee is just $3.50. He uses a small portable credit card scanner and asks for the PIN number for any debit card. What the victim does not know is that the scanner is a device used to steal the credit card information, in the way this kind of information has been stolen from ATMs and gas station credit card machines in the past. The scanner the courier uses even prints out a nice little receipt, making it all the more believable.
The victim doesn’t realize his credit card information has been used to make a dummy credit card with his name on it, which the thieves quickly use until the victim cancels the card. Thousands of dollars can be stolen from the victim’s by ATM cash withdrawals and numerous purchases before the victim knows what is going on. People are getting tricked by this. The scam is working for the scammers and you know they will keep doing it until the public gets well informed enough to decline the offer of the fake gift delivery over the phone.
If you are managing accounts for older clients, take the opportunity to help educate them about these nasty fraudsters who are easily able to get their names and phone numbers. You can make a difference. Tell them in person or make a handout about scams to email or send to them. They may see you as protective of their financial safety in more ways than one. That can uplift your image, always a good thing. We’ll keep you informed about elder abuse and how to protect your aging clients right here at
AgingInvestor.com.
Until next time,
Carolyn Rosenblatt, RN, Attorney
