This article was published in the Victoria Times Colonist November 27th 2011. To see this story and to read related stories on the Globe and Mail website, please click here
Devastated. Simply devastated.
That’s the only word one Victoria resident can find to describe the aftermath of a sibling’s betrayal and abuse of trust that has robbed their elderly mother of a comfortable retirement.
In two years, armed only with power-of-attorney papers and a trusting family in another province, the sibling, who lives closer to the mother, has chewed through hundreds of thousands of dollars meant to pay for care and provide a little cushion for the surviving family members.
“It’s like a death, this is the end of my family,” said the Victoria resident, who asked not to be identified. “I have been a mess, I can’t stop crying when I think about it.”
The tears are not for the money, now long gone, but for the breach of the family’s trust.
“The betrayal, that’s what has devastated me the most, I could care less about the money, I don’t have a [sibling] anymore, that’s it for me.”
The betrayal started just over two years ago when the sibling, who had power of attorney for the mother who was in an extended-care facility, started using the mother’s assets to fuel what appeared to be a very comfortable lifestyle.
But even hundreds of thousands of dollars don’t last when it’s spent at such a rate – there were transactions for tens of thousands of dollars as well as small daily living expenses being provided by money in the mother’s account.
The mother’s bills were no longer being paid as of the middle of this year. By that time, the retirement account had been drained completely.
“I heard all the excuses at the time, but I still can’t get my head around it,” said the Victoria resident, who noted the mother initially had enough money to live another couple of lifetimes. “How can someone live with themselves after doing something like that?”
Unfortunately, it’s not an isolated incident. According to the groups who see this all too often – police, the province’s public guardian and trustee and the support and service groups who work closely with seniors – elder financial abuse is a growing problem.
“It has steadily been an issue and we have seen some increase,” said Catherine Romanko, the public guardian and trustee of British Columbia. “And based on the demographics we are expecting as the baby-boomer generation ages, we will see increasing incidents of financial abuse of seniors.”
There are more than five million people in Canada age 65 and older, but the number grows every year and will hit nine million over the next 25 years.
The public guardian, which specializes in financial abuse of the vulnerable and incapable, has seen the number of referrals to the office for investigation increase to 1,456 this year from 1,333 three years ago.
Sidney-based notary public Laurie Salvador likes to think they are isolated incidents, but even she admits it doesn’t take much looking through her files to find examples of vulnerable elderly people being taken advantage of by family or caregivers.
There was the lonely, elderly man looking for a housekeeper.
The middle-aged woman who replied to the ad cleaned at first but soon became more than an employee – within a week she had moved into the home and soon convinced him to get married.
With a marriage certificate, the new wife arranged a trip to a notary’s office to have property transferred into joint tenancy – the notary’s interview with the husband revealed he did not even know his new wife’s name, and the notary refused to prepare the transfer as he was clearly incapacitated.
But a trip to a lawyer who did not know the elderly male gave the new wife all she wanted – her name added to the title, and using that to establish a $150,000 line of credit which she used to buy another home in her name.
With her husband’s children growing suspicious, she convinced him to move to that new house and within six months they had plowed through all of his assets, and he died penniless and estranged from his children.
There is also the story of an elderly woman, housebound for medical reasons, who asked a notary for help changing her will to ensure one of her sons, who was disabled, would be cared for from the proceeds from her only asset, a waterfront home.
The notary advised her she should have an independent executor and power of attorney. However, the woman believed her other son, a successful lawyer who did not get along with his brother, would object if he was not given power of attorney.
When the mother’s health deteriorated, the lawyer son moved her to a care facility and used the power of attorney to transfer the family home into his name, all but disinheriting his brother.
“I don’t know if it’s more prevalent or if people are just talking about it more these days,” said Salvador. “There’s certainly more awareness of it, and people in that baby boomer generation seem more willing to talk about it whereas the previous generation just didn’t, they often didn’t even show or discuss their wills with their children.
“I don’t get a sense it’s a critical situation, but it does happen and we need to do whatever we can to stop it or prevent it.”
According to the police and support services for seniors, statistics on the incidence of elder financial abuse are
sketchy at best, given most of the cases go unreported either because of embarrassment or not wanting to bring the family into disrepute since most cases arise from family taking advantage of elderly parents.
However, the indications are it is a serious problem.
The B.C. Centre for Elder Advocacy and Support takes about 200 calls a month on its toll-free line, with 70 per cent of them relating to elder financial abuse.
And the Canadian Association of Retired Persons reports the incident rate of any kind of elder abuse is probably about 10 per cent of the senior population, but when those seniors are asked if they know anyone else who might have been abused, the number is more likely near 30 per cent.
“That suggests a high level of under reporting,” said Susan Eng, CARP’s Vice President of Advocacy.
Eng said one of their recent surveys showed of the percentage of people who admitted they had suffered abuse, about two per cent had been victims of financial abuse.
“But 26 per cent responded they thought they knew someone else who had suffered financial abuse,” she said. “For me, one case is too many.”
B.C.’s public guardian points out there are a number of reasons the incidence of financial abuse of seniors is going to rise, beyond the simple fact there will be more seniors joining the ranks every year as the baby boomers age.
Romanko said with increasing age you see increased incidents of mental incapacity, there are more debt-laden younger families taking care of a generally well-off older generation and today’s population is also more mobile, meaning seniors are often living far from their support network.
“The baby boomers are a wealthy group, generally speaking, compared to prior generations, so you have an increasingly vulnerable group of people who have acquired wealth over the years who may be isolated from family members, and with declining physical and mental capacity those people become more vulnerable,” she said.
And while caregivers, financial advisers, lawyers and the like have been known to take advantage of vulnerable seniors, Romanko said the majority of abusers by far tend to be family.
“That’s most typical and it isn’t always a matter of malice,” she said. “Sometimes you have family members who feel an entitlement in sharing in the assets of a parent, they think mom’s elderly and has lots of money and doesn’t need it and may not even know she has it.”
Romanko said you often see families mismanaging funds, not knowing their responsibilities or how to carry on with power-of-attorney responsibility.
Romanko said one of the biggest problems is seniors often don’t want to report the abuse.
“Sometimes they are ashamed they have been taken advantage of, or they don’t want to disrupt the family situation. They may think if they report abuse it will cause disruption, and they won’t be taken care of anymore or access to some family members will be denied,” she said.
According to Det. Rick Anthony, fraud investigator with the Victoria Police Department, because it victimizes the most vulnerable and often comes from so-called loved ones, elder financial abuse has to be considered heinous.
“It really is the most reprehensible of all the financial crimes,” he said. “Fraud is just as violent in its effect on people’s psyche and ability to sustain themselves as robbery – with robbery it’s fast, while fraud tends to be more thought out and pre-planned and by the time you know you’ve been taken, it’s gone.
“It is every bit as violating as robbery or assault – if you get punched in the nose the nose will heal, but lose $100,000 and you’ll never get that back. It may not seem as violent, but it is every bit as life-altering.” [email protected]
TYPICAL TYPES AND JUSTIFICATIONS OF ELDER FINANCIAL ABUSE:
– Using money, property, or possessions without authorization;
– Misusing a power of attorney;
– Misusing a bank account, often a joint account, or theft of cash, credit cards, bank cards, mail;
– Pressuring a person to sign financial or legal documents;
– Not paying bills or essentials for living;
– Forging a signature;
– Cashing in RRSPs without permission;
– Not paying back loans to an elderly parent;
– Taking or withholding a senior’s pension or insurance cheque;
– Selling the senior’s property or possessions without permission;
– Forcing the senior to change his/her will or grant power of attorney designation;
– Belief that seniors do not need money or have a future;
– Believing that a parent’s assets, money or property should be used by the younger generation.
RED FLAGS TO WATCH FOR:
– Physical or verbal abuse
– Suspected misuse of a power of attorney
– Significant changes in bank account activity
– Significant changes in investment account activity
– Pressure to sign documents
– Remortgaging or selling a home
– Opening a joint bank account with an older person
– Having the older adult co-signing loans or credit lines
– Having the older adult guarantee a debt or other commitment
EXAMPLES OF FINANCIAL ABUSE OF SENIORS:
– Robert obtained a power of attorney from his grandfather and began to sell some of the acres of land and some of the livestock. He promised his grandfather he would give him the money once the transaction was completed. Many months passed and Robert had not paid his grandfather. His grandfather asked Robert for the money several times, but did not receive it.
– While her mother was in the hospital, Karen moved her mother’s silver tea service, some valuable books and a grand piano to her own home. When her mother returned from hospital, she asked the police to assist her in recovering her stolen property. Karen stated that she had taken the goods for safekeeping and that these items are heirlooms belonging not just to the mother, but the entire family.
– A caregiver befriends a senior and persuades him/her to open a “joint account” so that she can assist with bill paying and getting cash from the account as required. Within a few months the senior discovers that the account has very little money in it. A considerable amount of money has been taken out. Because it is a joint account, either party can take money out of the account.
– A mother frequently gives her adult son her pension cheque to be deposited into her account and to bring back a specified amount of cash. While at the financial institution her son uses his mother’s pension cheque for payment to his overdue credit card. He did not have his mother’s permission.
Source: B.C. Centre for Elder Advocacy and Support