Crackdown on elder abuse
With number of financial exploitation cases on rise, new state laws
strengthen prevention and prosecution
by Kate Tormey ~
April 2012 ~ PDF
of article from Stateline Midwest »
Iowa Rep. Lisa Heddens was recently working with
a law firm specializing in elder law, and was shocked to hear the number of
cases that involved the financial exploitation of senior citizens.
“When I thought about Iowa,
which is an aging state with an older population, I wondered, ‘What else do we
need to have in place to protect our seniors?’” says Heddens, a Democrat.
It led to what
has become a common occurrence in state capitols across the Midwest: New
legislation that cracks down on a crime that costs its victims an estimated $2.9
billion each year in the United States.
That figure is on the rise
(by 12 percent since 2008, according to a study done by the MetLife Mature Market
Institute and the National Committee for the Prevention of Elder Abuse), but
Heddens and other lawmakers are hoping to stop that trend with laws that raise
awareness about elder financial abuse and increase penalties for perpetrators.
Senior citizens tend to be
more vulnerable to financial fraud, scams and manipulation because they are more
likely to have a large net worth and to have cognitive impairments that affect
their decision making — a dangerous combination.
Typical crimes include
forging signatures on financial documents and cashing checks without the account
holder’s permission. Some abusers convince seniors to transfer money to other
accounts, sign over property or buy expensive items for someone else. In some of
the worst cases, caretakers deny medicine or food to victims who don’t agree to
give them money or possessions.
U.S. population gets older, elder-law experts warn that the problem could
worsen. In the 11 Midwestern states, the percentage of people 65 and older is expected to rise from
13.6 percent in 2010 to 20.7 percent in 2030 (1 percentage point higher than the
United States as a whole).
The issue received
widespread national attention last year after 90-year-old actor Mickey Rooney
testified before U.S. Congress about being financially abused by members of his
family, who allegedly took over his e-mail account and forced him to grant
access to his finances.
In about one-third of the
instances of elder financial abuse, the MetLife Mature Market Institute study
found, a family member, friend or neighbor is the perpetrator. It is most common
for the abuser to be a stranger (in a little more than half of the cases). The
most likely victim is a woman between the ages of 80 and 89.
The same study notes, too,
that the $2.9 billion annual cost to victims does not capture the full impact
and prevalence of the problem. Cases are often simply not reported.
After looking at the data —
and seeing that other states are also addressing the issue — Heddens decided
this year to introduce a bill calling on four state agencies to conduct a review
of Iowa’s policies on the abuse of people over age 60. Under HF 2387, which was awaiting the governor’s signature as of
late March, a report with recommendations for legislative action must be
completed by the end of the year.
“This is about coming up
with a plan that is right for Iowa,” Heddens says. “It’s a starting point.”
The Iowa agencies are
directed by the legislature to look at other states’ laws on elder financial
abuse, and the group will likely look to recent actions taken in the Midwest to
prevent, investigate and prosecute these cases.
bills include measures to curb cases of elder financial abuse
Heddens, Michigan Sen. Tonya Schuitmaker has been shocked to hear story after
story of how senior citizens are being taken advantage of in her state.
heard one anecdote of an elderly man who hired a contractor to fix his home. The
contractor brought the man breakfast and started to gain his trust — and then
started recommending more repairs. The two would go to the bank together and
withdraw money for work that cost a fraction of what the contractor was
The transactions were
finally reported by a bank teller who became suspicious of the unusual account
activity, but not until the senior had lost more than $100,000. Bank employees
might have spoken up sooner if they had received more-thorough training,
Schuitmaker says, or if they knew they wouldn’t be personally liable for
information provided to law enforcement.
That’s one of the reasons
why Schuitmaker, a Republican, has led an effort to pass a package of 18 bills
related to address each of what she calls the “three legs of the stool”: the
mental, physical and financial abuse of seniors.
She made the legislative
package a priority after seeing similar measures languish in recent years and
after hearing from local law enforcement, prosecutors and advocates for seniors
that elder financial abuse is a growing problem in Michigan.
In terms of financial abuse, SB 463 would require training for employees of different
financial institutions, such as banks and credit unions, to help them identify
and report suspected financial exploitation of vulnerable adults. The bill
provides civil immunity to people who report suspect activity to
A series of bills (SB 456, 460, 604 and 605) would require institutions to notify joint account
holders that each depositor is an equal owner of the funds and that each has the
ability to add and withdraw money, and that when one account holder dies, the
other continues to have full access to the account.
“A lot of times people open
up joint accounts and they don’t realize the joint account holder has so much
access,” Schuitmaker says. “This bill would strengthen what banking institutions
do in terms of notification and awareness.”
As of late March, the bills
had passed the Michigan Senate and were being considered in the House.
requires training of bank employees, stiffens abuse penalties
In Illinois, the state receives
about 12,000 reports of elder abuse each year, the majority of which are related
to financial abuse or exploitation.
According to Claudia Kemple of the Illinois
Department on Aging, about 2 percent of the reporters in these cases are
financial institutions — a number that her department would like to see
For about a decade, the
state has operated a program called B*SAFE, which trains employees at these
institutions to spot and report possible financial abuse. The program has two
components: The first certifies employees themselves to train their colleagues;
the second brings staff from the state Department of Aging or elder-abuse
agencies to the banks to conduct the training.
As of Feb. 1, the training
is now mandatory for all employees as the result of legislation (SB 3267) passed in 2010.
Each institution must
provide a 30-minute program for employees, who must be retrained every three
years. Institutions can opt to use the state’s B*SAFE program as a training model or they can integrate the
material into training already provided to workers.
Financial institutions are
not required to report suspected abuse (attempts to mandate reporting have been
unsuccessful in the Illinois legislature), but they are provided legal immunity
if a report is made. In fact, anyone can report suspected abuse anonymously
through a statewide hot line 24 hours a day, seven days a week. The Department
on Aging holds the identities of these individuals in the strictest confidence
unless compelled to divulge a name by court order, Kemple says.
Illinois lawmakers have also
stiffened the penalties for people who exploit seniors. Under HB 1689, passed last year, cases involving $50,000 or more are
now considered a Class 1 felony; previously, the threshold for a Class 1 felony
was $100,000 or more in stolen property.
Legislation currently making
its way through the Illinois General Assembly would further strengthen the
penalties for financial abuse. HB 5653 would allow prosecutors to freeze the assets of a
defendant in cases where a senior citizen or disabled person has allegedly been
Lee Beneze of the Illinois
Department of Aging describes this ability to freeze assets as “a very powerful
tool for prosecutors,” because they could better track the funds in question and
keep perpetrators from spending stolen money prior to their conviction.
The bill passed the House by
a vote of 99-1 and, as of late March, was under consideration in the
Minnesota adds new type of felony, and new tools for
Policymakers in Minnesota, too, are concerned about the
growing trend of elder financial abuse and are taking steps to bring
perpetrators to justice.
“Our effort was undertaken with an eye toward improving the ability
of investigators to build cases that are effectively prosecuted,” says Iris
Freeman, associate director of the Center for Elder
Justice and Policy at William Mitchell College of Law in St. Paul, Minn.
Freeman leads the Vulnerable
Adult Justice Project, which brings together law students, policy experts and
key stakeholders to advocate for policies that help senior citizens and prevent
When it came time for
Freeman and her partners to look for a legislative sponsor in Minnesota, they
had to look no further than their very own school — to Democratic Rep. Debra
Hilstrom, who was working on her law degree when the project launched in 2008.
“When they asked me to be
chief author of the bill, it was an honor,” Hilstrom says. “The folks who have
come before us have done a good job building our state and our country, and we
need to do what we can to protect them.”
HF 818, which passed in 2009, created a new type of felony for
the financial exploitation of a vulnerable adult involving an amount greater
than $35,000. It carries a sentence of up to 20 years in prison.
The same bill also included
several measures to make it easier to investigate and prosecute such cases. For
example, the statute of limitations on such cases was extended from three years
to five years because these crimes often occur over time, Freeman says.
In addition, county
attorneys now have the ability to subpoena the banking and financial records of
a vulnerable adult as part of an investigation. And while financial institutions
are not required to report suspected abuse, the law encourages them to do so by
clarifying their immunity from legal challenges if they make a report “in good
“We wanted to
make it easier for banks to give up records and report when they think there is
exploitation going on,” Hilstrom says.
There are no data yet to
determine whether the number of reports of abuse has increased since
implementation of the law.
However, Freeman says it is
already clear that the measure has improved the working relationship between
financial institutions and law enforcement.
The bill, which received
wide bipartisan support, also calls for operation of a statewide hot line to
“Previously, statute said
that you had to call the area with jurisdiction,” Hilstrom explains. “You had to
call where it happened. But if the vulnerable adult was in one place and the
person exploiting them lived somewhere else, who do you call?”
Hilstrom is now seeing the
law from a slightly different perspective — as an assistant county attorney. She
has already prosecuted two cases related to the elder financial abuse
She says it is “an
incredible opportunity” to see that the law she helped shape is already making a
“This is the right thing to do — raising
awareness and talking about the warning signs,” she says.
“More folks are
aware, and when more people are aware, more people are reporting. It really goes
a long way to protect people.”