Why Elderly Investors Become Targets for Financial Fraud?
The notion that our parents and grandparents are potential targets for financial fraud is abhorrent to any individual who adheres to the common principles of decency and morality. And yet, our elderly family, friends and neighbors continue to fall victim to financial fraud. These fraudulent acts can range from common theft to sophisticated schemes designed to conceal fraudulent acts through representations of so-called “safe” investments. As the population ages, the instances of elder financial fraud are expected to grow resulting in a disproportionate amount of financial fraud schemes that will target elderly investors.
Why are elderly investors more likely to become targeted by unscrupulous financial advisors? There are a myriad of conditions and factors which lead to the financial exploitation of the elderly. As compared to the rest of the population, elderly investors tend to:
- have greater accumulated wealth;
- be more trusting and polite;
- be physically isolated and lonely;
- be vulnerable due to emotional distress from loss of spouse, or their pet;
- be hesitant to report exploitation by someone they depend upon for daily assistance;
- be unable to understand financial matters;
- be unprepared for the loss of financial decision-making capacity;
- have cognitive impairments that affect financial decision-making and judgment; and
- be dependent on another person who may pressure them for money or control of their finances.
Klayman & Toskes, P.A. is dedicated to the rights of elderly investors and their families. State of Florida Statute 825.103 is designed to punish perpetrators of “elder financial fraud” and protect the exploitation of elderly persons. A financial advisor or other person engages in elder financial fraud if they:
- Knowingly, by deception or intimidation, deprive the victim of use or benefit of personal funds;
- By an individual who know or reasonably should know that elderly person lacks capacity to consent; and
- Breach of fiduciary duty to an elderly person which results in an unauthorized appropriation.