How Do We Protect Seniors From Abuse?

Earlier this year, the Consumer Financial Protection Bureau analyzed more than 180,000 Suspicious Activity Reports (SARs) submitted by financial institutions to FinCEN, the federal government watchdog agency, from 2013 through 2017. The CFPB found that “financial exploitation of older adults by scammers, family members, caregivers and others is widespread in the United States.”

ABC 15 Phoenix’s recent online report, “Protecting seniors from financial predators,” says the trend is not surprising to many estate planning and elder law attorneys. Unfortunately, they hear from many families who are seeing elderly loved ones being taken advantage of financially.

Families reach out to these attorneys who specialize in senior issues, because they’re concerned that a grandparent or parent is being scammed.

For example, there are hundreds of cases listed on the Arizona Adult Protective Services Registry. The registry lists the names of suspects and circumstances of substantiated or uncontested claims of the exploitation and abuse of vulnerable adults.

Nearly all of these cases involve people the victims should have been able to trust, such as a caregiver or someone with power of attorney. The cases also include forging checks, using credit cards and selling a victim’s home and pocketing the proceeds.

Experts think the problem will only get worse as the population ages. Families are cautioned to pay extra attention after a major life change, like a medical diagnosis or the death of a spouse. People who have suffered a loss or a frightening life event are lonely. When someone enters their life, they’re just excited to have someone to talk to.

Warning signs include a change in behavior. That sometimes shows as a new person is entering their life and is actively isolating them, or suddenly, they’re not sharing information with you as before.  There may also be items that go missing around their house. These thefts often begin with small loans that aren’t paid back, or money for helping around the house. However, this eventually increases as time passes, and the exploiter gets braver.

In Arizona, the State Department of Adult Protective Services investigates elder financial abuse complaints, but these cases are rarely criminally prosecuted. Families frequently have to use the courts to undo damage and prevent future problems, especially if the family member is in denial about being exploited.

Family members can petition the court for conservatorship, guardianship or ask that a guardian ad litem be assigned to the senior—a court-appointed attorney that acts only on the victim’s behalf.

Reference: ABC 15 Phoenix (June 4, 2019) “Protecting seniors from financial predators”

Special Needs Families and Special Needs Trust

If nothing prepares a person for parenting, consider how much harder it is to be prepared to raise a child with special needs. Parents often sink in uncharted waters. It’s not just a matter of negotiating all of the day-to-day details, says Newsday in the article “Be ‘biggest advocate’: Parents plan future for adult children with special needs.” Special needs families need to plan for what will happen as the parents age, become ill or die.

As an adult child with disabilities ages, eventually there will be medical issues. If the parents are gone, who will be able to make medical decisions? Where they live, who will oversee their finances and who will be there for them to rely on in a parenting role? There are many questions and they all need answering.

For one family, raising their special needs daughter was a full-time challenge. Their daughter, now 24, has autism. The couple sought out others in their same situation, noting that often even their own family members could not relate to their daily experiences.

It takes a village for special needs families to do more than survive. That includes estate planning and elder law attorneys with deep experience in special needs planning, social workers, therapists and medical professionals. Here’s what needs to be top-of-mind:

Don’t wait to plan. Families often think they have time, but you never know when unexpected events occur. Have a plan in place for legal guardianship, finances and health care.

Work with experienced legal help. You want to work with an attorney who has a great deal of experience and knowledge in special needs law and estate planning. Someone who dabbles on the side of a real estate practice is not the right professional for the task.

Stay in control. When children turn 18, they are adults. Parents and guardians will need to go through Surrogate’s Court to become the child’s guardian. Unless that is done, the parents and guardians will have no legal rights about the child’s medical, financial or other affairs. A successor guardian also needs to be named, so that when the parents are no longer able to serve, someone is in place to care for the child.

Create a Special Needs Trust. A trusts attorney with experience in Special Needs planning will be able to work with the family to create and structure a Special Needs Trust (SNT). A disabled person usually cannot earn enough to support himself, or the caregiver who remains at home to care for them and care-related expenses. The SNT helps to meet current needs and plan for future needs. The trust is used to preserve eligibility for any means-tested state and federal benefits. It allows the individual to have a better quality of life, by providing for expenses that are not covered by their benefits.

It’s very important that no assets be left to the child in an inheritance. Any assets must be placed in the trust. A well-meaning relative could put their eligibility for aid in jeopardy.

Parents and guardians also need to name a trustee and a successor trustee. The person needs to be competent, good with money management, organized and focused on caring for the loved one. It cannot be an emotional decision.

Parents of special needs children are advised to create a Letter of Intent, a narrative that outlines their child’s likes and dislikes, strengths and weaknesses, activities and friends they enjoy and other details that will help them to continue an enjoyable life, when their parents are gone.

Parent’s own estate planning must be done with an eye to maintaining the SNT and caring for their other children. This is a case when assets need to be distributed in a realistic and fair manner. If one sibling is the successor trustee, for example, they may need a larger portion of an estate to help care for their sibling.

Reference: Newsday (May 9, 2019) “Be ‘biggest advocate’: Parents plan future for adult children with special needs.”

Does Estate Planning Include Your Account Passwords?

With most bank customers receiving financial statements electronically instead of on paper, there are some actions you need to take to be sure your accounts are incorporated into your estate planning.

Kiplinger’s recent story, Your Estate Plan Isn’t Complete Without Fixing the Password Problem,” says that having online access to investments is a great convenience for us. We can monitor bank balances, conduct stock trades, transfer funds and many other services that not long ago required the help of another person.

The bad thing about these advancements, is that they can make for a very difficult situation for a surviving spouse or executor attempting to determine where the assets of a deceased person are held.

This was in the news recently, when the founder and CEO of a cryptocurrency exchange died unexpectedly. Gerry Cotten didn’t share the password to the exchange’s cold storage locker—leaving $190 million in cryptocurrency belonging to his clients totally inaccessible. Investors may never see their funds again.

You can see how important it is to provide a way for someone to access your data, if you become incapacitated or die.

The easiest, but least secure answer is to just give your passwords to a trusted family member. They’ll need passwords to access your accounts. They’ll also need a password to access your email, where electronic financial statements are sent. Another simple option is to write down and place all passwords in a safe deposit box.

Your executor or guardian/attorney-in-fact through a power of attorney (in the case of incapacitation) can access the box and your passwords to access your computer, email and financial platforms.

This is a bit safer than simply writing down and providing passwords to a trusted friend or spouse. However, it requires diligence to keep the password list updated.

Finally, the most secure way to safely and securely store passwords is with a digital wallet. A digital wallet keeps track of all your passwords across all your devices and does so in an encrypted file in the cloud.

There’s only one obstacle for an executor or surviving spouse to overcome—the password for your digital wallet.

Wanna know how to protect your possessions and pass them down to your heirs? Click here.

Reference: Kiplinger (April 19, 2019) “Your Estate Plan Isn’t Complete Without Fixing the Password Problem”