Looking for practical ideas and expert guidance in making decisions about the legal, financial, and healthcare issues facing your aging parents? Carolyn Rosenblatt’s book, The Family Guide to Aging Parents, is available for purchase and includes insight on important financial topics such as:
Family disputes
Caring for aging loved ones from a distance
Protecting aging loved ones from financial abuse
Our Guests: Dr. Mikol Davis and Carolyn Rosenblatt
For perspectives on these topics and more, tune in to KQV 1410 AM tomorrow evening at 7:05 p.m. for The Lange Money Hour, Where Smart Money Talks, as Jim Lange welcomes Carolyn Rosenblatt and Dr. Mikol Davis to the show.
Carolyn Rosenblatt began her career as an RN, primarily working as a visiting nurse for 10 years. She is also an attorney who vigorously represented injured individuals over a 27-year career. When Carolyn retired from litigation and trial work, she started AgingParents.com with her husband, psychologist, Dr. Mikol Davis. Initially, Carolyn planned to help resolve conflicts involving elders and their families. As she began working as a mediator, she found that her clients often needed someone with knowledge to provide answers on both health care and legal questions. Those two areas of expertise can rarely be found in the same individual, and Carolyn saw an opportunity to bring her two professions together to fill that need. Carolyn is a regular contributor to Forbes.com on healthy aging and dealing with aging loved ones.
Since the show will be live, you can join the conversation by calling the KQV studios at 412-333-9385 after 7:05 p.m. You can also e-mail questions in advance by clicking here. The show will also be live-streamed at www.kqv.com. KQV will rebroadcast the show this Sunday at 9:05 a.m. The audio will also be archived on our web site at www.paytaxeslater.com/radioshow.php, along with a written transcript.
Finally, please join us in two weeks on Wednesday, September 16th at 7:05 p.m. for the next new edition of The Lange Money Hour.
About James Lange, CPA
Jim Lange has 3 decades of retirement and estate planning experience as a CPA. Jim’s strategies have been endorsed by The Wall Street Journal (35 times), Newsweek, Money, Smart Money, Reader’s Digest, Bottom Line, and Kiplinger’s. His articles have appeared in Financial Planning, The Tax Adviser, Journal of Retirement Planning, and Trusts & Estates.
Jim is the host of The Lange Money Hour on KQV 1410 AM. He is also the author of two best-selling books, Retire Secure! (Wiley 2006 and 2009) and The Roth Revolution endorsed by Charles Schwab, Larry King, Ed Slott, Roger Ibbotson, Natalie Choate, and Jane Bryant Quinn.
When the medical information and personal data of 80 million Americans was hacked at Anthem Blue Shield it served as a wakeup call. It provides us with another way concerned professionals can educate and warn their clients about keeping personal data safe.
Get this: The information gained by the hackers – including social security numbers and birth dates and even income – are an identity thief’s dream, and the massive breach makes clear that any record can be at risk when companies fail to take security seriously.(more…)
One benefit of the increasing life expectancies for Americans is that more people have bonus years for enjoying the company of their aging parents.
But all is not rosy. Those extended years also boost the odds that parents could go broke or suffer from dementia and be unable to make financial decisions for themselves.
That can leave adult children perplexed about when and whether they should step in and find out what’s happening with their parents’ money, says Carolyn Rosenblatt, a registered nurse and elder law attorney.
“Unfortunately, it’s not always easy to have those conversations,” says Rosenblatt, co-author with her husband, Dr. Mikol Davis, of The Family Guide to Aging Parents (www.agingparents.com) and Succeed With Senior Clients: A Financial Advisors Guide To Best Practices.
“Some stubborn parents just refuse to talk about their money. No matter what their adult children say to them, they put it off, change the subject or tell their children it’s none of their business.”
Of course, many adult children aren’t in any particular hurry to broach the subject either, says Davis, a clinical psychologist and gerontologist.
“They have their own discomfort about it and procrastinate,” he says. “Then a crisis comes up and no one has any idea what the parents have or where to find important documents.”
But Rosenblatt and Davis say it’s critical that these conversations take place so that the offspring can gather information about such subjects as the parent’s income and expenses, where legal documents are kept, and what kind of medical or long-term-care insurance the parent might have.
The success of these conversations often comes down to how you approach the subject, Rosenblatt and Davis say. They offer a few tips:
End the procrastination by picking a date for the talk. Make an appointment with yourself to bring up the subject at a specific time. An opportune time to schedule this is after a birthday, a family event or a holiday where other family members are together who may share in the responsibility for the aging parents in the future.
Show respect. Tell your parents you understand and respect their reluctance to discuss their finances. You can even make the conversation about yourself rather than about them. Say that you’re concerned that if something went wrong, you would be completely lost as to how to help them.
Address their fears head-on. Let them know you understand they are worried that if they talk about their finances their independence might be taken away. You might add that you want them to maintain their independence as long as possible and you’re willing to help accomplish that, but you can’t do it without the correct information.
“Getting past an aging parent’s fear about talking about finances can be daunting,” Rosenblatt says. “But a well-planned strategy for approaching the subject will give you your best chance.”
About Carolyn Rosenblatt and Dr. Mikol Davis
Carolyn Rosenblatt and Dr. Mikol Davis are co-authors of The Family Guide to Aging Parents (www.agingparents.com) and Succeed With Senior Clients: A Financial Advisors Guide To Best Practices. Rosenblatt, a registered nurse and elder law attorney, has more than 45 years combined experience in her professions. She has been quoted in the New York Times, Wall Street Journal, Money magazine and many other publications. Davis, a clinical psychologist and gerontologist, has more than 44 years experience as a mental health provider. In addition to serving his patients, Davis creates online courses and products to assist professionals and the public with understanding aging issues. Rosenblatt and Davis have been married for 34 years.
Dr. Mikol Davis and Carolyn Rosenblatt, co-founders of AgingInvestor.com
Carolyn Rosenblatt, RN, Elder Law Attorney offers a wealth of experience with aging to help you create tools so you can skillfully manage your aging clients. You will understand your rights and theirs so you can stay safe and keep them safe too.
Dr. Mikol Davis, Psychologist, Gerontologist offers in depth of knowledge about diminished financial capacity in older adults to help you strategize best practices so you can protect your vulnerable aging clients.
So many professionals we talk to are worried about aging clients, those in their 80’s, 90’s and older. And for good reason. Mikol’s mother is now 92 and she lives independently. She is not exactly a sophisticated investor or consumer. She is very sharp mentally, but that does not mean she could not be manipulated. She has already been taken advantage of by one financial advisor. He got caught though. By us. We took a quick video of Alice, and without naming any names, you can see what she has to say about what the investment this advisor put her into. Click on image to see Video.
We have a very special advantage with Alice. She is willing to let us watch over her investments and her day to day financial life. Not only is she open to receiving this support, she generally welcomes it. That is not an advantage every family has. But even if your aging client or loved one is less than willing to allow those in their lives who can protect them from harm to discuss their financial business, they may be willing to make at least one concession. We recommend that you try for this, suggest it to all the aging folks in your world and take one small step in the direction of their protection.
The professional crooks are at it again. The U.S. Attorney’s office recently charged six defendants with yet another telemarketing fraud scheme targeting the elderly. The allegations are that the con artists sought out and preyed upon the elderly through their lottery scam. We see these reports often in the news, to the point that they seem very repetitive. The characters and the amount of money stolen from elders changes but the methods are the same over and over. They caught the scammers this time and charged them with theft of a total of $400,000 from various victims. That’s the least of it. Other scams bring in millions from their vulnerable victims.
Why do elders fall for these things? Why don’t they get that the “Nigerian prince” or the “Jamaican Lottery” are clearly bogus and not to be trusted? (more…)
Carrie got concerned when her brothers suddenly began to exclude her from their Mom’s financial affairs. It didn’t feel right, but she wasn’t sure she could do anything about it. When she called, I got that “slow burn” feeling that comes over me when I hear about financial elder abuse. As a consultant for folks with aging parents, it’s not the first time I’ve heard this kind of story. (more…)
With $30 trillion in wealth being transferred between generations now and over the next decades, advisors are missing a huge opportunity. If you are fine with losing your chance to retain the next generation after your current clients transfer their wealth, do nothing different. You can count on 66% of your client’s heirs taking their business elsewhere. If you would like to change the odds for yourself, you need to do a lot more than “get to know your client’s family”.
That vague advice will not result in adult children of your current clients seeing you as a desirable person to trust. If you want to establish relationships with the heirs, take the advice of those who have researched this problem of client flight and do more.
As you stay in the financial advising business for a time, you will surely see more aging clients. People are living longer than ever in history. They are part of your practice now or they will be soon enough. With aging come risks: cognitive decline, physical limitations and the need for care that can get very expensive. Will diminished capacity make your client vulnerable to abuse? Can you help protect your client by taking proactive steps right now?
You want to be of service, but you don’t want to go overboard and become someone’s social worker. What can you do to ensure your clients’ safety and well being as they age? Here are five tips for the conscious advisor who knows your client beyond managing the money.
The gripping thing about this case is not just the horrific means used to steal money. It’s the shocking failure of every person involved to ever notice that over a 6 year period, a caretaker isolated, abused and stole millions from a 74 year old, helpless stroke victim.
Li Ching Lu was convicted of financial abuse via fraud and forgery in Long Beach, this month. She got 4 years in state prison, which seems appallingly short for what she did. Over a period between 2002 and 2010, she emptied her victim’s bank accounts by writing checks and depositing them in 63 different accounts at 4 different banks.
Why didn’t anyone notice that she began to isolate her victim from her friends, family, financial advisors? Did any of them care enough to check on their friend or client? Did the cessation of contact from a person who had amassed a small fortune from investments ever alarm the investment advisors on her team enough to find out why? (more…)
The securities industry is pushing to impose temporary holds on certain transactions that may be precipitated by a clients’ declining mental capacity, or purported loved ones who may be trying to swindle them. Sounds good in theory. Too bad it won’t solve the problem of financial abuse. Does the industry think that waiting is going to make the problem of predators go away?
Here is an example of a real case in which this exact method of the broker waiting and hoping didn’t do a thing for the elder who was being abused. READ what happened:
Have you ever heard the term “undue influence”? from time to time, Most people don’t really understand what it means. Is it just some weird legal thing? Or should you understand it? When it comes to seniors and financial abuse, the term becomes very important, because undue influence can readily lead to financial abuse.The legal concept of undue influence goes way back in history to the 1600s. A lot of our law in the US is based on what our British ancestors did. Sure enough there is an old case in which a woman pretended to love an older man and pressured or influenced him to give her all his money and property upon his death. She didn’t love him. She was married to someone else. The elderly man changed his will and left everything to her, and not to his own family. His family sued, she lost and they got the estate he would have left to them if he hadn’t been under the influence of this woman.
The English court found that she had used undue influence on him to get him to change his will.Centuries have passed but the same problem exists today. People use their relationship with someone to get them to give money or property to the influencer. We hear about it all the time at AgingParents.com where we work with families helping them deal with issues about aging loved ones. The struggle in families about control over an aging parent’s finances often comes about because someone thinks another family member is using undue influence over a vulnerable elder. And sometimes it’s true!Laws about undue influence vary from state to state. Where I live in CA, we have a really good definition that helps people prove when someone was under undue influence of another person. Keeping it simple and non-legal sounding this is the essence of the definition: Undue influence is excessive persuasion that causes another person to act or refrain from acting by overcoming that person’s free will and results in something that isn’t in the influenced person’s best interests. A person who is elderly, frail, dependent on others for care or who is undergoing a lot of stress is particularly vulnerable.
The influencer is usually in a position of trust, like a family member or a position of authority over the one being influenced. The person in authority could be a professional, such as a financial advisor or lawyer, or it could be a caregiver.
What are some of the classic warning signs of undue influence?
Here are five of them:
1. The victim is vulnerable, such as shortly after a spouse has died or because he or she has dementia and can’t make good decisions. But a person can be vulnerable just because of being lonely too.
2. The influencer assumes power, authority or control over the one being influenced. This could come from the relationship, where the one being influenced thinks the influencer can be trusted and doesn’t question them.
3. Isolation of the senior, and doing things in secret, in a hurry or because the influencer tells the victim that everyone else is against her.
4. Sudden changes in a long-standing estate plan, including a will and or trust. The so-called “natural heirs” or family are cut out of what they were going to inherit and it goes to someone outside the family as a result of the senior being influenced to make those changes.
5. Something happens that is not fair or reasonable for the victim. For example, another seizes control over their assets and they can no longer choose what to do with them. Or the elder’s home is sold and he is forced to go to a nursing home against his will. These are examples of harm or an unfair result to the victim.
Undue influence is legally related to financial abuse. Harm to the elder in some way is the result and it always involves money, property or an agreement that affects the elder’s welfare.
We hope you have a good idea now of undue influence. If you see any of the warning signs happening to someone in your life, to a client, family member or friend, speak up!
Seek legal advice from an elder law attorney or report the harm you see to Adult Protective Services.
Working together, we can all do something to stop elder abuse.
Most of us hear about unscrupulous family members taking advantage of their aging parents or grandparents. And everyone knows that internet scams abound. The one in which the scammer calls an elder and pretends to be a grandchild in trouble is notorious. And unfortunately, successful as it still goes on. Funds from grandma’s account get wired to Western Union and the thief disappears.
Financial elder abuse is rampant. The National Center On Elder Abuse puts the amount stolen from elders each year at $2.9B. But a privately run recent study calculated the amount at a shocking $36B+ per year. Who is doing this to our seniors?
Family members are the most frequent abusers of elders, because of access, exploiting the relationship of trust, and knowing just how easily manipulated a parent or other loved one can become with aging and dementia. Family members usually know how much money their parents have and how to get the parent to either give it to them or give them control over it so they can take it without the parent’s knowledge. Sadly, we see this often in our consulting work at AgingParents.com.
Caregivers, who also develop a relationship of trust with their care recipients, have the advantage of being with the elder in unsupervised situations. Ruthless caregivers get the elder to sign a power of attorney and being dependent on the caregiver, the elder may be fearful and intimidated if she does not acquiesce to the demands of the caregiver. In one case, a caregiver managed to steal $4M from a 74 year old client with multiple sclerosis who became physically unable to manage for herself. The caregiver got a power of attorney and opened 67 accounts in eleven banks. One bank finally caught on and reported their suspicions, but it was too late. The caregiver went to jail but the elder died before the criminal’s sentencing.
In spite of the easy access family and caregivers have to seniors, the most dollars are actually stolen from elders every year by professionals. That includes broker-dealers, insurance sales persons, lawyers and others in a position of both trust and authority to manipulate or outright steal elders’ funds. About a third of FINRA prosecutions involve elders. There are ripoff artists among us.
One thing that doesn’t seem to change over time is the reality that most cases of elder abuse go unreported to authorities and are therefore never prosecuted. The thieves get away with it. In one case we saw in our office, a 92 year old whose son had power of attorney for her took thousands of dollars from her bank account and refused to account for it. We were involved in helping her change the authority he had over her finances. I spoke with her and described that what her son had done was wrong and was a crime. She knew it was wrong and did not want to take action. Her response: “I don’t want my son prosecuted”.
Many elders are more frail and less willing to pursue legal remedies than a younger person may be. They suffer from shame, depression and embarrassment that they have been so taken in by anyone. Some just don’t have the energy to fight back and the thieves know this. They count on it.
What can the concerned financial professional do about financial abuse? There are ways you can be more vigilant and protective of clients than ever. Here are five things to keep in mind for any aging client.
Know that even at the very earliest stages of dementia, a client is likely to be moderately impaired for making safe financial decisions. Pay attention to their ability or lack of it to understand complex or risky products such as non-traded REITS, which regulators disapprove of selling to seniors. Avoid suggesting or offering any products which require significant analysis by the client if you have even a hint of cognitive decline in that client.
Know that age alone is a risk factor for developing dementia and its accompanying diminished capacity. By the time your clients reach age 85, at least a third of them will have Alzheimer’s Disease or other dementia. Two out of three persons affected by Alzheimer’s are women. Be especially vigilant with your aging female clients.
Know your client. If he or she departs from a long standing spending pattern and you suddenly see unexplained large cash withdrawals, be suspicious, ask questions and probe. Someone could have gotten control over your client’s account. Don’t stand idly by. Get involved and find out. Report abuse if you suspect it. Take action to stop the abuse. Protect your client.
If you work in an organization where professional colleagues have aging clients and there is opportunity to either sell them unsuitable investment products or otherwise manipulate these elders, lobby your organization for enhanced and more frequent scrutiny of all client accounts for people age 65 and up. The Federal Government and state laws define an “elder” as someone 65 and above. Watch those accounts more often and in more detail.
Develop your own best practices, senior-specific policy, in writing. Training in best practices and commitment to your clients’ safety will enable you to get it right. Once you have a clear policy in place for yourself independently or for your organization, everyone can respond to red flags of diminished capacity and warning signs of elder abuse in a uniform way. That will enhance your ability to honor your clients so you can protect him from predators.
This really happened. If you had this 91 year old client, what would you do?
Emma liked to play the sweepstakes. But her memory was starting to decline. A lot. When it came to her bank account, she forgot to check her statements as she had always done. Odd withdrawals began. Hackers had gotten in. Before she realized what had happened, someone had withdrawn a total of $40,000. It was time for her family to act. Emma was a planner. She had trusted her son and put his name on her trust, her durable power of attorney and her health care directive. But her son needed cash. He became an opportunist.
She had a daughter too, but she was old fashioned and thought the man should take care of the money. Her son, Jonny knew his mother needed to stop handling her finances. So, he rushed her off to the clinic and told the doctor what happened with her bank account. After 15 minutes, the doctor, without doing any psychological testing on Emma decided that she was no longer capable of handling her affairs. He and another clinic doctor signed a handy form letter to that effect and gave them to Jonny. Jonny then went to both Emma’s banks with a copy of the trust appointing him to take over when Emma could no longer handle her affairs. He produced the two form letters from the doctors and was instantly given access to Emma’s account. He withdrew all of her cash, a total of $20,000.
Jonny then informed Emma that she was coming to live with him. He would charge her $1000 a month to live there. Emma was very angry. She admitted that she could no longer keep track of finances, but she did not want to give up her home, her community and the things she loved to do. She was alert, and knew what losing her home would mean. Jonny worked full time. His idea of a life for his mother was to take her to adult day services early every morning and leave her there until after 6pm when he returned from work. She wanted none of it. She felt betrayed, duped into giving Jonny all the power and furious that he could run her life without any interest in what she wanted.
There is danger in assumptions. Loss of the ability to handle finances safely does not mean in every case that a person can’t make decisions about where to live, what she wants and who should be in charge of her affairs. Emma had the strength to stand up to her son. She contacted us with her daughter at AgingParents.com. Was Emma too impaired to change her trust? The only way to safely answer this controversial question was to have Emma undergo psychological testing and some interviews with Dr. Davis, my partner here.
Testing was done and two interviews on different days were conducted. Result: Emma had mild cognitive impairment and still had the ability to decide who should handle her affairs. She did indeed have significant short term memory loss but many of her other abilities were intact. Her daughter then took her to a local attorney and she immediately changed her trust to appoint an independent, licensed fiduciary to be her new trustee. I doing so, Emma removed all power from her son. She put her daughter on the trust too, but only for oversight of the fiduciary. The fiduciary would have complete decision making ability as to how Emma’s funds should be spent. And she gave authority to her daughter on her healthcare directive to decide where she would live, as she knew that her daughter would honor her wishes to remain in her home, with a helper, for as long as possible.
The risk of making the assumption that loss of capacity for financial decisions means total loss of the ability to think or decide everything else can lead to disaster. Emma was nearly kidnapped by Jonny who was determined to make his little scheme work, all to his benefit ($1000 a month). With total power in his hands, he likely would have immediately sold her house as well. She was fortunate to have escaped a fate that would have made her both frustrated and miserable.
The takeaway here is to beware of too hasty conclusions that an aging parent is completely incapable of decisions other than financial ones. Financial capacity may be the first intellectual ability to go when impairment begins but it is not a sign that the person has no ability left for anything else. While it is true that many impaired elders grossly overestimate their own ability and insist on living in unsafe conditions, some elders are not as impaired as circumstances might suggest. Psychological testing can provide important objective data to help families make the right choices. Emma was willing to do whatever it took to stay in her own home. At 91, we at AgingParents.com thought she deserved that dignity, at least. Emma has regained her sense of control and we’re glad for her.
Imagine this scenario. The person making all financial decisions was the man of the house. His somewhat timid wife, married to him for many years, never wanted the responsibility to decide how to invest. They had a multimillion dollar estate. Then Harry, her husband died and she was totally unprepared.
That’s “Rosanna’s” story. Rosanna was married for decades to Harry who passed away at age 85. She was 82 at the time. They had three adult daughters and one son, Jackson. Their son was never a steady job holder and had fantasies of how he was going to be a business owner. After his father died, he saw an opportunity. He could easily manipulate his mother, who looked to him to essentially take Harry’s place with decisions about investments. Rosanna had begun to suffer serious memory problems and couldn’t remember a conversation from morning to evening. She was clearly a person with diminished capacity.
Jackson was a co-trustee on the parents’ trust with his mother and sisters, but had sole power to make investment decisions. He conspired with the long time broker-dealer who used to work with his father. The broker also saw an opportunity. The broker told Jackson that he could help him out but Jackson needed to put a lot more of Rosanna’s money into variable annuities. What this meant was that her money would be tied up for years, unless she paid a stiff surrender charge to get to it. A full 87% of Rosanna’s money was then shifted into variable annuities. When Harry died, the amount invested in annuities was about 40%, which was plenty. This shift of most assets into annuities of course generated a huge commission for the broker. About the same time, Jackson took a six-figure loan from Rosanna’s trust without consulting his sisters and without informing them.
They were angry and upset with Jackson for manipulating their mother, for taking out a “loan” from their mother’s trust, which he didn’t pay back and for sneaking around behind their backs putting so much into variable annuities. That was going to affect their inheritance. When the sisters called me, we discussed the issue of manipulation of their mother. No one had ever checked her out for her capacity for financial decisions. When her daughters wanted her to see a doctor to find out more about her memory troubles, Jackson vetoed it. Rosanna consulted Jackson on everything. This meant that legal action was necessary. I referred them to an elder abuse attorney to take up the cause. They were very distressed and not speaking to Jackson. Meanwhile, Jackson again manipulated his mother to get money from her, with which he hired an attorney to harass and threaten the sisters. It was ugly.
No one can be sure how this nasty tale will play out, but the regulators will probably not like the fact that the broker put so much of an 85 year old’s assets into variable annuities. They will probably not like that he had to override his firm’s internal controls set up to prevent that. They will probably not like the fact that the net result is that the estate lost a significant sum compared with what it would have done in conventional investments suitable for an 85 year old. I sent the sisters the forms to file complaints with both FINRA and the SEC. They will also have an attorney to represent them in that matter.
And as for Jackson, I hope that the courts will deal with him justly. He is looking out for himself, that is clear. As a trustee, he had a legal duty to the trust, not to his own self interest in grabbing a six figure “loan” from the trust that he had no means to repay.
The takeaway here is that your aging clients, particularly the very unsophisticated ones like Rosanna are sitting ducks for abuse by unscrupulous brokers. And it is up the the advisors who are ethical to blow the whistle. It is up to everyone to seek justice for the unwary who become victims of manipulation because of greed, the ease of taking advantage of an elder, and the attitude that “it’s not my problem, she’s not my client”. Please make it your business. At AgingInvestor.com, we want to put a stop to this kind of abuse. We urge you to join us!
Click HERE if you want to help us make a difference.
Philip Marshall was devoted to his grandmother, wealthy philanthropist, Brooke Astor. Her victimization by her own son, Philip’s father, Anthony Marshall, created irreparable harm to the relationships in the family. Anthony Marshall and one of his attorneys conspired to divert millions of dollars to Anthony’s benefit after Ms. Astor developed dementia. They were both convicted in criminal court of financial elder abuse. Would you have had the courage to stand up to your own father and take on the cause of justice of your grandmother if you had been in Philip’s shoes?
Philip recently contributed to the American Bar Association’s journal BiFocal, a publication of the Commission on Law and Aging. He wrote a piece in the hope that the telling of his sad family circumstances would continue to contribute to the recognition of elder abuse and exploitation as an insidious and pervasive national problem. Parts of his article are summarized here.
Philip did not start out as an expert in elder abuse. He loved his grandmother, who had always been a donor to worthy causes, being described as “a humanist aristocrat with a generous heart”. In her later years, she was increasingly isolated by the actions of Anthony Marshall. Close friends were denied visits. A long time and caring staff member was fired. Anthony Marshall, Brooke’s only child, had been appointed power of attorney. He used his power to abuse and control her. There were many red flags in Anthony Marshall’s actions. He sold Brooke’s favorite painting, which she had bequeathed to the Metropolitan Museum of Art, one of the objects of her charitable giving in her earlier life. The paining brought millions, two of which Anthony kept as a commission.
Brooke loved her country house, where she hoped to spend her final days. Anthony closed the housed and fired Brooke’s most loyal staff member, her butler Chris Ely. Under pressure from two of Brooke’s closest friends, Anthony reluctantly agreed to reopen the country house, but shortly after that, moved his mother back to her apartment in New York.
Philip was suspicious of what he saw happening and began to speak with more staff and caregivers. He learned that his grandmother’s lifestyle, emotional and physical care and life were being compromised by his father’s actions. He could not bear the damage he witnessed to her psychological and physical well being. He sought advice. He met with his grandmothers’ close friends and decided that something should be done.
Philip petitioned for guardianship. This always presents an uphill battle when the only adult child is in charge and the psychological abuse and neglect are so difficult to prove. The petition was granted and Philip immediately moved his grandmother back to her country house. By the time the petition was granted, his father was forced to return over $11 million in assets and pledged over $10 million to cover any future claims. But the battle was far from over.
Ms. Astor died peacefully in 2007 with friends at her side. Following her death, Anthony Marshall filed papers on court using three codicils (additions) to her will which redistributed almost $100 million to his control. The unbridled greed of Philip’s father was shocking. He was already provided over $60 million in the original will. That wasn’t enough. He had to conspire, forge documents, manipulate and abuse his own mother to get tens of millions more.
The New York DA had evidence of the criminal abuse case and indicted both Anthony Marshall and his attorney, Francis Morrissey. The case went to trial in 2009. Philip had to testify against his father. There were many witnesses to the abuse and financial manipulation. Anthony Marshall was convicted on 15 of the 16 counts against him. All counts but one were upheld on appeal.
At AgingInvesor.com and AgingParents.com, we are vigorous advocates for stopping elder abuse. We applaud Philip Marshall not only for his courage to bring the guardianship petition in the first place, but to continue the battle to honor his grandmother’s legacy of charitable giving, as originally provided in her will. His actions came with a huge emotional and economic cost to himself. But could not live with the injustice he saw. He was willing to air the family’s dirty linen in public. He was willing to take sides and stand up for the vulnerable person with dementia his grandmother had become. Let his story be an inspiration to all of us.
Until next time,
Carolyn Rosenblatt, RN, Elder Law Attorney, Mediator
Attention Financial Professionals: Are You A Hero? We want to highlight you!
We are very interested in financial planners, wealth managers, RIAs, CFPs, trust officers and others who have protected elderly clients from abuse or stopped it after they became aware of abuse or predatory practices. Without a fiduciary standard, inappropriate products are being sold to elders by some in the financial field. And that doesn’t even address the outside predators who seek out elderly victims. They’re everywhere.
At AgingInvestor.com we are allies of the elderly, having spent years of our lives serving them, my wife as a nurse and then a litigator and myself as a mental health provider. We will be sponsoring a contest in early April to feature the best of the best in financial services who stopped or prevented elder abuse. My wife and partner Carolyn Rosenblatt blogs at Forbes.com (Aging Parents) and AgingInvestor.com to keep those in this community informed. We want to tell your stories. We hope to educate others in the field and this community by highlighting the actions of courageous people who stepped up to stop scammers, thieves and greedy players inside or outside the financial services field itself. We have a few great candidates already! We know you’re out there. Submit your own name and story or that of someone you respect for their abuse prevention efforts to hero@aginginvestor.com. If you need to remain anonymous for political or personal reasons, we will honor that and not use your real name, location or work place. We want to share your exemplary actions. And if what you did was leave a large organization so you wouldn’t be part of abusive practices there, we think that’s heroic too. Please tell us. We’ll protect your identity totally.
Your stories will inspire others to follow your lead. We’ll feature you in our newsletter with your permission, and let our social media contacts know that you are a standout among the rest. If you want anonymity, we will simply point out the problems that spurred you take the steps you did and that we want to honor the decisions you made. We applaud you.
Thanks for joining us.
Sincerely, Dr. Mikol Davis & Carolyn Rosenblatt, RN, Attorney
Heavy advertising by those selling reverse mortgages could convince anyone that this product will get you to nirvana. The sellers tout them, promising to let you “live the life of your dreams” or “have a better retirement”. Really?
The Federal government has responded to numerous complaints by borrowers about reverse mortgages (home equity conversion mortgages or HECMs) and issued a summary report. It’s available through the Consumer Financial Protection Bureau but if you don’t have time to read it, we summarize for you it here at AgingInvestor.com.
The reverse mortgage complaints submitted to the CFPB demonstrate the wide range of problems some consumers have with these loans. The largest volume of complaints, according to the report, center on difficulty in trying to change the terms of the loans. When borrowers want to refinance the loan or add borrowers, they can’t. Some borrowers do not understand that the loan proceeds as well as accrued interest on the loan over time substantially decrease the amount of available equity. What this tells us at AgingInvestor.com is that despite mandatory “counseling” before getting the mortgage, the borrower is not getting the message. Whether that is a defect in the counseling itself or the consumer being swayed by the “live the life of your dreams” advertising we do not know. What we do know is that borrowers get upset when they find out they can’t refinance these loans.
Other consumers complain that lenders refuse to lower their loans’ interest rates and they feel that as interest rates have declined, that they’re being overcharged. Trying to change the terms of the loan at all is very problematic. When adult children want to be added as borrowers they can’t be added. Borrowers do not understand that adult children can only retain the home for an aging parent by paying off the entire loan balance or by paying 95% of the value of the home. Is this a failure to understand the mandatory counseling their parents were given? Or is it that this critical detail is lost in the effort to get an older homeowner to take the loan, “live the life of their dreams” and have a wonderful time with the loan proceeds?
As we see it, the worst outcome of a reverse mortgage occurs when title is transferred to one spouse in order to get the HECM, perhaps because he or she is of an age that makes it possible to borrow more equity than the other spouse could do. The loan is taken in the name of that one spouse only. The borrowing spouse later dies. The non-borrowing spouse then will lose the home. Distraught widows and widowers face foreclosure in this scenario. Of course they can’t pay off the loan or they wouldn’t have needed the HECM in the first place. Some consumers report that their loan originator falsely assured them they would be able to add the other spouse to the loan at a later date.
The U.S. Department of Housing and Urban Development (HUD) is changing this horrible problem. It issued a mortgagee letter in August 2014 that provides that non-borrowing spouses meeting certain conditions, may remain in the home after the death of the borrower spouse but only for loans originated after the date of this letter. Most HECMs originated after August 4, 2014 will be made in both spouses’ names. For the rest of the many borrowers whose loans are older than that, a widowed person will likely lose the home after the borrowing spouse dies. So much for living the life of their dreams.
If you are in a position to advise clients about the pros and cons of a reverse mortgage, be sure that you know these details before directing anyone to such a loan. Yes, in some cases, a HECM can be a lifesaver. But as we see it, that’s only a good idea when there are no other options available to pay the basic cost of living in the home and surviving there to the end of life. It’s not prudent for any consumer to have a lavish lifestyle on borrowed money, only to run out of equity when they need money most: when disabled and in need of care. Consumers need to be cautioned not to take out equity and recklessly spend it as if there were no consequences to depleting what is for many, their only significant asset.
Help us keep elders informed. Please share this with a friend, a client or member of your own family.
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.
Imagine you’re at your desk, calling your elderly client for approval of something you’d like to do with his portfolio. The last time you spoke with him, he seemed a little “out of it” but you carried on and did your work. Now, you’re on a call with him again and he’s just not getting anything you’re saying. You repeat patiently. Nothing. You suggest talking to him at a later time.
When you call back two days later, your client has no recollection of the earlier conversation that had you concerned, and worse yet, he still can seem to grasp even the simplest explanation of why you’re calling.
What should you do?
Your client has presented some ominous signs of cognitive impairment, which include inability to track the conversation and memory loss. He has no memory of your call two days earlier. Prompting him by reminding him of when it was and what you said didn’t help.
If you know there is a problem, there is one major reason why you absolutely must do something about it. That is: clients who are developing cognitive impairment are sitting ducks for financial abuse. The abuse could come from a family member, which is an unfortunately common occurrence. It could come from a credit card company who tricks your client into signing up for years of something she doesn’t want or need. It could come from an internet scammer who preys on people exactly like your client, cleverly and with great success. As you may have heard, the latest study on financial elder abuse found that it costs our seniors $36.48 billion a year, rather than the previous estimate of $2.9 billion.
If you believe that confidentiality prevents you from sharing anything about your client with anyone else, take you cue from the Canon of Ethics for lawyers, who have to honor confidentiality as much as anyone can. It says, paraphrasing, that a lawyer may but is not required to take protective action if a client is in danger. In my mind, any ethical lawyer who believes reasonably that her client is in danger from potential financial abuse is going to take protective action. When you see a client too confused to follow your conversation and too impaired to remember a call two days before, that client may be in danger right now. If protective action means calling a designated emergency contact, then you should do it. If it means taking the matter to supervisory or compliance personnel in your organization, then do that as well. If you believe you have no other choice but to get rid of your client and no longer handle his finances or business affairs, then that is also a choice. However, we at AgingInvestor.com think you do have options other than firing your impaired client.
When we look at the law, it builds in protections for those who lose the ability to manage finances for themselves. One of these is a Durable Power of Attorney. Every prudent person who gets estate planning done should have a DPOA as part of the estate planning package. Take your cue from what the law allows any adult to do. That is, everyone should appoint a trusted person to take over when he or she is no longer able to manage finances independently. You client should appoint someone you can call and most importantly give you permission to call or contact that appointed person when your client demonstrates behavior as we described above. The person your client has designated on the DPOA to be her agent may also be the one she give you permission to contact if you believe she is vulnerable to abuse.
Every advisor, business professional and lawyer serving older clients should have permission to contact a third party in the event of emergency or imminent danger. You can get it done with a straightforward document.
If you aren’t sure how to get a waiver of privacy done or whom your client wants to designate, it’s time to act now. Get these things accomplished with the help of experts who can guide you. If you have them in your organization or at your disposal, create your policy without any delay. If you need help, we’re here to offer it at AgingInvestor.com. Contact us for advice, help with drafting your own special privacy waiver, or education about how to bring up the subject of cognitive impairment with your aging clients.
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.
Prior studies put the extent of financial elder abuse at $2.9 billion a year. A recent study finds that the actual amount stolen from elders is $36.48 billion a year. It’s no wonder that some call financial abuse “the crime of the century”. And yet, too many financial professionals see the warning signs and don’t know what to do or think that privacy concerns prevent them from doing anything.
I hope I can change your mind about the privacy issue. It should not stop you from doing the right thing.
According to the report of this recent study by True Link, a financial services company, the design of this survey was guided by recommendations of an expert panel of fraud researchers convened by the Financial Fraud Research Center at the Stanford Center on Longevity. That gives it credibility. No one has yet commented on any flaws in the study and I cannot say if there were any specific shortcomings, but the figure of over $36 billion is indeed startling.
Some of the most surprising study conclusions are that seniors who are younger, urban, and college-educated lose more money than those who are not. That somewhat defies the stereotype in other research suggesting that the isolated, lonely and unsophisticated senior would be the most vulnerable to loss. Another surprising finding is that legal but misleading tactics used to get a senior’s permission to take money from them leads to losses of $16.99 billion per year. The senior may be tricked into giving consent to credit card charges, for example and not realize how deeply or how long that consent ends up costing them.
So it’s not just the unsophisticated investor who gets taken by scammers. It can easily be your well educated client who thinks he knows more than you do and takes very foolish risks because he feels so capable of making decisions. Maybe he is impaired and doesn’t know it.
Or she gets sucked into long term contracts for things she doesn’t want or need. Once she gives approval for a credit card charge, she may be stuck with it. The study shows that people who start out losing a little each year tend to suffer increasing losses over time. A $20 a year loss can turn into a $2000 a year bilking and so on.
One thing every financial professional can do now is to develop a privacy waiver document specific to your organization or your management as an independent advisor that allows you to contact a trusted other whom your client has chosen, in the event that you see some red flags suggesting elder financial abuse.
If you’re unsure about what will give you a legally appropriate form for doing this, we can help you create one at AgingInvestor.com. Education and prevention of elder abuse are our mission. Everyone’s take on privacy may be different, but one thing is clear: you can’t continue to hide behind privacy as an excuse for doing nothing while your very own clients may be victims. Anything from telemarketer scams to undue influence by family to abuse by slick and unscrupulous salesmen of financial products that exploit older investors are everywhere around you.
One thing the study doesn’t explain directly is that it is also up to families to monitor their loved ones. True Link offers a product that allows monitoring of all an individual’s accounts in one place. Great, but what if the aging person won’t let family have access to the account information? That is a major issue. If you, as an advisor want to get involved, you can work with your client early enough that you have a clear policy in place when the time comes that your suspicions of abuse are raised. With a privacy waiver, you have the right to contact family or the person your client appointed to get the ball rolling on stopping abuse.
Caring and honest family need your help as a trusted professional to keep them alerted to any signs of trouble with an elder’s judgment about financial decisions. Some families are scattered all over and they may not have contact with your client about finances. You may not be able single-highhandedly to wipe out every abuse problem, but it seems clear that if you develop a clear policy for reporting danger signs and your suspicions of abuse, you can change the status quo.
You can sharpen your knowledge of an aging client and their financial capacity by completing one of our 6 C.E. courses at AgingInvestor.com. Try the one on understanding the signs of diminished capacity. Sign up today and get an hour of CFB accredited continuing education. Click HERE.
We know that abuse of seniors is a growing problem. Based on information from the National Center on Elder Abuse, the majority of abusers are family members. However, only 44 out of 1000 instances of abuse are reported to authorities. Why aren’t more cases reported to the very authorities capable of stopping the abusers?
It seems to me that most family members are simply unwilling to “rat out” another family member even when they know that abuse is going on. When it comes to the seniors themselves, there is shame and embarrassment associated with being taken advantage of by someone close, especially someone they surely trusted. There is hesitation and fear. They want to talk about it but not do anything about it. The reluctance to report the abuse to Adult Protective Services is not limited to the seniors who can’t bear to call the authorities about a son, daughter or other relative.
I recently received a call from a distressed sister of a brother that she was convinced was stealing from their parents. He had total control over their parents, one of whom had dementia. His parents had appointed him as the agent on both the Durable Power of Attorney and the Advance Healthcare Directive. This gave him the legal authority to make both financial decisions without being accountable to anyone else and all healthcare decisions as well. I listened patiently to all the reasons she thought her brother was taking her parents’ money and using it for himself. I asked her if she had called Adult Protective Services.” No”, she said. When I asked why not she said “I don’t want to get my brother in trouble”. Where is the logic in that?
In another case, the elder herself had called. “I gave my grandson a big loan and he hasn’t paid it back,” she said. “But now I need the money to live on”. She described how her favorite grandson had taken title to her mobile home and gotten a loan, even after she had “loaned” him most of her savings. I explained that her chances of getting paid back were probably not very good, but the least she could do was to report what had happened to authorities. I advised her that taking a “loan” from an 80 year old and not paying it back would likely be considered elder abuse and it should be reported to APS. “Would my grandson go to jail?” she asked. I told her I didn’t know but it can happen when someone has committed this crime of elder abuse. She said, “I don’t want my grandson to go to jail”. Unfortunately, I am sure she did not follow up or do anything more about the problem.
Seniors like the 80-year-old woman are typical of why elder abuse does not get reported and therefore prosecuted more often, even when a family member is well aware of what is going on and knows that it is wrong. They would rather suffer impoverishment than be the one to report abuse. In fact, these same victims may refuse to testify against a relative who has abused them, even when these cases are prosecuted. Charges may not stick when the victim is unwilling to testify, unless there are independent records to prove the case in court.
It is as much a problem of our emotions and fears as it is of the wrongdoing itself. We somehow justify the actions, we look the other way or we fear what justice will do to our abusive relative.
I wonder, where is the anger at a crime against a person who is easily taken advantage of by the abuser? Where is the advocacy for the vulnerable person who is also our relative? Why are we remaining silent in this growing, $2.9 billion dollar a year problem?
I would be willing to guess that there is someone reading this whose client has a financial abuser in a their family or knows of a family where this has taken place. I urge you to speak up. To my knowledge, you can remain anonymous in your reporting, just as you can with any crime. Whether or not the criminal justice system can prove the crime is not your problem. It is your problem to carry the knowledge of financial abuse with you and to do nothing to protect the elder. One day it could be you who is victimized.
We are all encountering an aging population and the crime of opportunity of abusing elders is not going away. I am hopeful that we will show enough concern, enough responsibility and enough guts to do the right thing when we see a wrong that needs our attention.
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.
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
—
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.
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.
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.
Financial advisors can spot and do something to prevent financial elder abuse. Advisors are in a unique position to observe their clients over years, sometimes decades. Knowing a client well gives them the vantage point to understand their clients’ normal general life situations as well as their patterns of using their accounts, which can make them well positioned to spot red flags and any unusual activity.
As part of the national legal community dedicating time to the protection of vulnerable elders I see communications from lawyers all over the U.S. with complaints that Adult Protective Services are not taking financial elder abuse seriously enough in many places. When it is reported, APS may dismiss it as “a civil matter” in which they have no interest. APS is essentially an investigative help to the criminal justice system. It can intervene when an elder is in physical danger. Social workers and investigators from APS look into reports of abuse and help the DA determine whether there is evidence sufficient to prosecute a crime. If the matter involves the undue influence of a family member and the elder seems willing to give away money, even if duped into doing so, APS is unlikely to take any action.
Financial advisors cannot rely on the their local community’s APS to protect their clients when abuse is suspected. Particularly in the case of family, close associates, and caregivers, APS may not wish to interfere unless or until an obvious crime has been committed. Many of these abusive situations are not so obvious, or the elder appears to be willing to give away his assets, and he may not see that anything is wrong. it is up to others to work to stop the abuse, including financial advisors, who may be in a highly trusted position with the elder.
The financial services industry, generally, has avoided certain kinds of communication with family of aging investors due to privacy laws, concerns which they interpret as precluding them from sharing financial information. I do not agree that privacy should stop advisors from communication with family when an elder clearly needs protective action. There is a way around the privacy question. Policy can be created to obtain permission from every client to communicate with a family member or trusted other appointed to step in when the advisor (and compliance) have reasonably concluded that the elder is being taken advantage of financially or otherwise.
If you see something, say something is what we are supposed to do to stop terrorist attacks. It is also what we need to do to stop elder financial abuse. The financial industry needs to develop new, forward looking, senior specific policies to address the rampant problem of elder abuse.
Here at Aging Investor, we are doing our part to help by developing educational materials for industry professionals. We want every professional to recognize the red flags warnings of potential abuse, to understand diminished financial capacity and to how to get the necessary document in place around the issue of privacy. Aging expertise from outside the financial services field is needed for all of these points. I hope all advisors, their compliance departments and organizational heads will pursue what FINRA has urged on you since 2008: that senior-specific policies be put in place to stem the rising tide of elder financial abuse of their own aging clients. We offer resources such as our CE courses and have written a book to help you better understand and manage your aging clients.
Until next time, Carolyn Rosenblatt AgingInvestor.com
Doesn’t every financial advisor want to stand out from the crowd? Be better at delivering services? Somehow get a reputation as a cut above the average guy or gal in the biz?
If you are seeking to distinguish yourself, you can. The secret is not in getting better returns, finding unique ways to protect assets or getting it right with your investment strategies. It’s in offering a different service from the other guys in addition to doing all the money management, usual things well.
The different service we’re talking about is looking at your older client’s age, making a plan to look at all the aspects of their lives that are likely to change as they age and being an educator and advisor to help them plan for those things. This is not limited to figuring out how much your client will need in retirement. It goes way past that, and the issue of housing. Yes, your role as advisor will go beyond financial matters into the personal and the so called “soft skills’!
Does this make you uncomfortable? “I just manage money” you may be thinking. But the financial picture is connected to the person, who is usually connected to a family. The finances are not in a vacuum with no relation to an investor who is aging, and her needs as she gets older and may lose her ability to make sound financial decisions. This is not about merely preserving assets and making the money last. People are of course affected by the aging process, which brings with it risks. One of those risks is dementia and loss of financial capacity for accepting your advice. What then?
“I’ll worry about that when my client gets old” you say? The problem with that thinking is that you don’t know when your client is “getting old”. Dementia is a sneaky brain disease that usually develops over years. The signs are subtle. And dangerous. The risk of Alzheimer’s Disease, the most common kind of dementia doubles every 5 years after age 65. 5.2 million people already have it. Lots more are expected to develop it as Boomers age. One day, as you avoid conversations about possible loss of financial capacity, you may find that it is too late to get your client to sign anything, agree to anything, or worse yet, that he is a victim of financial abuse.
If you truly want to stand out as an advisor, not just for being a great producer, but for offering cutting edge service, get the training you need to make that service include skill in addressing and anticipating possible loss of capacity in your clients. Get the right document in place to protect your client and protect yourself from regulatory questions about privacy.
If you are considering this suggestions seriously, visit us at AgingInvestor.com and sign up for one of our online courses. We’ve got the aging expertise you may not have yourself and you can get a lot smarter about aging clients as you get some training.
Meanwhile, think about becoming a unique service provider who is branching into an area no one can avoid: our populations is living longer than ever. You are in a great position to be a forward thinker about aging issues with your clients as a part of your work. You can take pride in it.
There is a buzz going on about the problems financial professionals are having with clients who are aging and losing capacity for financial decisions. It directly affected Kathleen Pritchard, head of business development at Legg Mason.
Her father-in-law was diagnosed with Alzheimer’s disease at 73 and she and her husband approached the father’s financial advisor for help. He had been managing an estate worth over 8 million dollars. He said,
“I basically don’t do any of that. I just manage your dad’s money.” (more…)
Your elderly clients are ripe for scammers to pick. How is it that these clients, some very intelligent and accomplished, fall for these obvious ripoffs?
In a typical example the U.S. Attorney’s office charged six defendants in a fraud scheme targeting the elderly .This time it was a lottery scam involving theft of a total of $400,000 from various victims. . We see these reports often in the news, to the point that they seem very repetitive. The characters and the amount of money stolen from elders changes but the methods are the same over and over. Other scams bring in millions from their vulnerable victims. The thieves in this case were caught. Most are not.
Why do elders fall for these things? Why don’t they get that the “Nigerian prince” or the “Jamaican Lottery” are clearly bogus and not to be trusted? Isn’t it obvious?
There are various reasons why elders are such easy prey for these thieves. One root cause is isolation and loneliness, a fact of life for many seniors who are not closely monitored by loved ones. A pleasant, slick professional calls on the phone in a friendly and engaging manner and traps the vulnerable elder with kind words, attention and a feeling of connection. The thieves are trained and smart. They smell the kill. They know exactly what to say to get the elder to trust them.
Another very important factor isdiminished cognitionin the elder.The crooks know that if they have a thousand names purchased from magazine subscribers, U.S. lottery or state contests and they know the ages of those on the list, that their chances of finding victims are excellent. Some of the elderly on the lists will be just impaired enough that they can’t see a scam coming. At least a third of those aged 85 and above have dementia in some form. Scammers simply buy the lists and start calling. And there are no restrictions against selling the names and personal information such as ages, phone numbers, addresses, etc.to the highest bidder. They can acquire the name and age of every subscriber to The Reader’s Digest, for example, providing fertile ground for seeking victims. Research into the impairments of Alzheimer’s Disease tells us that financial judgment may be the first kind of judgment to erode, and it is not obvious at the beginning stages, though the impairment is significant.
Another reason why seniors fall for these ripoff schemes is that they feel financially insecure. If there is a downturn in the market or whatever investments an aging client holds, he may feel a need to get easy money or a high return, and when a con artist offers that, he’s likely to fall for it. The right combination of loneliness, isolation, early dementia and fear make him an easy target.
Can you do anything about the problem?
I think you can. If you do care about your aging clients and want to remain a trusted advisor, a first protective step is to be aware of the risk of scams targeting the elderly. At AgingInvestor.com, we recommend developing a policy for all aging clients that includes staying in more frequent contact with them than you are required to do. Here are 3 things that sort of policy might include:
1. Schedule monitoring of how the elderly client is doing in general on a regular basis, the frequency of which you determine by thoughtful planning. (Quarterly? less often?) Check in by phone. Reassure your client when investment losses happen, and ask how he’s feeling and what he’s doing in his personal life. This does take time, but it can be very helpful to renew the client’s trust in you and remedy somewhat the feelings of isolation that can accompany aging.
2. Pay particular attention to recently widowed aging clients. The aftermath of loss of a spouse can be a dangerous time because of grief. That makes people vulnerable to begin with and when you add some cognitive impairment to the mix you can see that thieves love the opportunity to cultivate these elders. Consider that deaths are public records and that scammers can easily collect lists of the recently widowed to pursue with their bogus offers. They may start the conversation by expressing their phony empathy for the person’s loss and work on a relationship after that.
3. Educate your client. She may have heard of scams and have a vague understanding of how they work, but not be ready to spot one when the phone rings with any scheme to defraud her. If you provide a respectful reminder, using a recent story of elder abuse by scammers published in news reports, which you can easily find any time, you just might cause your client to think twice before becoming engaged in conversation with a stranger who seems so nice and friendly. You can do your part to help your aging clients to beware of phone calls, contests and unknown people asking for personal information or money.
My mother in law, Alice is still quite sharp at age 91. Someone tried the “lottery winner” scam with her too. She called the number on the letter from the “Lottery Authority” and asked how she would know if they were legitimate. The accented voice on the other end of the call said “well if you think this is fake, you can hang up.” So she did. End of scam. Not all 91 year olds are so alert. Given that, the financial advisor may be one of the few trusted people in a position to help them create a line of defense.
As just about everyone was outraged and offended by Donald Sterling’s racist comments, you might wonder how there could be anything to learn from what he said and did in the time that has passed since his story first broke.
To some people, Donald Sterling seemed rational. A horrible racist, but being that way in control of his faculties and choosing to do what he did. Was there something wrong with him or was he just being his racist and unreasonable self? I think his conduct is a good example of how a cognitively impaired person can seem logical and in control one minute and totally out of control the next. And he is an example of how an impaired person can destroy his chances, make bad decisions and have a massive loss. You just might find yourself with a client like that.
Here’s what I mean. Donald Sterling’s comments led to his wife insisting that he be examined by two doctors, psychologists. Both concluded that he had Alzheimer’s Disease. When you saw Sterling on TV, you might have thought, “well, he seems weird, but he apparently knows what he’s doing”. Did he?
A person with Alzheimer’s lacks judgment about finances. That issue was at the very heart of the case when he agreed to sell the L.A. Clippers, and then changed his mind and tried to block the sale in a court battle with his wife. Some might be skeptical about the diagnosis of Alzheimer’s. After all, two billion dollars was at stake and fights over anything that big can bring up just about anything.
But notice this: if you want to win in court, you are going to put on your best behavior. If a judge is looking at you to make a decision about whether you are financially competent or not, you’re not going to do anything that would lead the judge, holding enormous power with his decision, to rule against you. That’s what a reasonable person with ordinary good judgment would do. Even if you’re mad as hell, you’re not going to lose it and prove to the judge just how out of control you are. But lose it is exactly what Sterling did with his chance in court.
Imagine that someone with that much money would hire the most highly skilled lawyers possible. Imagine that they were ready with all possible evidence to refute the allegations of Sterling’s wife that Donald was not competent. And what did he do? He behaved erratically over several days of testimony. He raised his voice at his own lawyers and those opposing him. He called his wife a “pig” in court. In other words, he could not exercise enough good judgment to do what any reasonable person would do in his circumstance. H could not rein in his impulses. He blew it.
Of course, the judge ruled against him. He was found to be incompetent to make a decision to stop the sale of the Clippers and his wife won out.
The lesson here is that people who have dementia, the major symptom of Alzheimer’s Disease, lose their judgment about finances. They may make bad decisions against your advice. They may behave erratically. They may act out one minute and be apparently fine the next. When you have a client who has a history and a pattern of making certain kinds of choices about how to invest his money, and he begins to divert from that, you know it is a red flag that something may be wrong. You know that he could lose his wealth if this keeps up. What are you supposed to do?
Other than escalating the problem to compliance sooner or later, you may not think there are any choices. But we at AgingInvestor.com believe there are choices about how you are going to approach and deal with these problematic clients, whether they are as extreme as Donald Sterling or not. There are options for anticipating the realistic possibility that your clients who are aging are going to become cognitively impaired. You can create innovative policies to manage them in a proactive way, involving family, involving significant others, and complying with privacy considerations. You don’t have to fire the client and lose the assets under management. If you have a clear path that enables you to take protective action and engage a third party whom the client has identified and appointed far in advance, you may be able to work with the appointed person and continue to carry out the wishes and philosophy of your client even if he becomes impaired. We are here to help you craft those policies and we empower you to implement them.
This process can change and disrupt the old, outmoded ways of dealing with our aging investors. It’s radical. It’s different. We think it should be done. If you would like to explore this for yourself or your organization, contact us today at AgingInvestor.com for a preview. We will help you become a change agent and an innovator.
A Red Flag For Financial Advisors With Aging Clients
Hello there. I’m Carolyn Rosenblatt, RN, Attorney and family mediator for those with aging loved ones. My passion is working with older adults and their families, as well as those who serve them.
AgingInvestor.com is dedicated to helping those in the financial services industry learn more about aging from those of us with expertise in aging. Our purpose is to help you better serve your clients, keep your business as they age and serve them more competently as their aging begins to create issues for you.
Most of us, in general, do not have any specific knowledge about aging itself, much less how it can affect the brain and decision making ability. We base what we know on our family experience or what we have learned from friends. That’s fine, but it can really limit our perspective.
The fields of gerontology, medicine, healthcare, and other related disciplines have produced a great deal of research that can be helpful to all of us in a society where longevity is increasing so significantly. We are indeed in a changing environment when it comes to aging. Many of us are going to encounter or are already encountering issues with which we have no experience but which we have to face. Our parents, grandparents and our clients are living longer and having more problems related to aging. We may be unprepared. (more…)
The client who called us was in great distress. Her name is changed to protect her identity.
Deanne had just been in contact with her mother’s financial advisor. Score one for the advisor for remembering that his client had a family and for having enough information to even contact the daughter. BUT, what the advisor told the daughter was very distressing.
“Your mother is going to run out of money in about 24 months”, he said. Deanne’s heart almost stopped! She is 52 years old and has had enough trouble supporting herself, much less worrying about her mother. She felt sick and panicked. What was she going to do?
Deanne’s mother is 84. She is in generally good health and may be around for quite a while. What might the advisor have done in this case?
Most financial services professionals work very hard to grow a client’s assets and to protect them against running out of money. But let’s face it: many factors are in play and when you start with a modest amount, there might not be a way to make it last to the end of a person’s life. How much notice do you have? Should you warn the family of a potential coming disaster? (more…)
And I’m Dr. Mikol Davis, psychologist. This is a true story about my Mom, Alice who was age 90 when this happened.
This is so hard to believe, isn’t it Carolyn?
CAROLYN: It’s so ironic. Here we are, always trying to give folks a heads up about preventing financial abuse. And then, something abusive happens to Mom! It’s amazing.
This situation came up when Mikol’s Mom decided to change financial advisors. The guy she was using for financial advice had talked to her about her investments a year before this happened. He thought he had explained this particular thing he put her in, but I doubt it. In any case, he never told her that he wanted to take a large sum and put it into something where she couldn’t access her money for 12 years!
Does that make sense to you? 12 years of not being able to take out your cash for a 90 year old?? (more…)
Dr. Mikol Davis and Carolyn Rosenblatt
We are very interested in financial planners, wealth managers, RIAs, CFPs, trust officers and others who have protected elderly clients from abuse or stopped it after they became aware of abuse or predatory practices. Without a fiduciary standard, inappropriate products are being sold to elders by some in the financial field. And that doesn’t even address the outside predators who seek out elderly victims. They’re everywhere. 
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.
