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Sunday, November 14, 2010

Scams: Signs of Vulnerability

I found this article a Financial Planning Association Website "Signs Your Elderly Parents Need Help — and What to Do About It " and the signs noted that indicate that things might not be quite right ring true in my own experiences, both personal and professional. Sadly, a scam is born everyday and the unscrupulous are well aware of who to target.

Below are the warning signs from the article and some short hand notes both from the article and from my own observations/experiences.

Money mismanagement:

Warnings: Bills piling up and are going unpaid, cash is being misplaced, cash flow is unusually tight, collection letters and disconnect services warnings, letters from the IRS and other tax authorities regarding unpaid liabilities.

Advice: Increase automation. Seek reputable, insured professionals to help and monitor their work.

Financial scams.

Warnings: Increased phone traffic, especially telemarketers, but don't discounts increased phone traffic from "banks" and "credit cards". Checks made out to unfamiliar companies. Changed spending habits. Increased junk mail, especially contests and lotteries for "free" trips, sweepstakes. Increased junk mail for cheap consumer products. Responding to the mail and phone calls. Bills for services never ordered or received.

Advice: Monitor the caller ID, put on the no-call lists. Same for the internet.

Financial abuse.

Warnings: Isolation of the elderly by other family members or caregivers, friends and family members developing a relationship out of the ordinary, access or information about finances to given to those who never had access in the past.

Advice: Don't be afraid to investigate with Adult Protective Services or even the police.

Unsuitable financial products.

(I'm glad the article mentioned this because although certain things might not legally qualify as scams, they serve as warning signs).

Warnings: Buying financial products that aren't appropriate, especially though door-to-door salesmen. Paying outrageous sums for financial services (and other services for that matter). Beyond financial products, changes to estate plans salesman who have just showed up on the scene unsolicited.

Advice: Listen and be alert. And, do your legal homework where necessary.


Warnings: Trips to casinos, playing the lotto. Family member talks about their winnings.

Advice: Check credit card activity, internet activity.


ProfK said...

All these warning signs are predicated on one basic thing: that children and parents share detailed information about their finances and spending and that children have complete access to their parents' financial records and vice versa. This is not the case in virtually most families. There may be some back and forth talk about expenditures but I personally know of no families that regularly sit down and peruse each others' bank statements, credit card statements and the contents of their mailboxes. I do know plenty of families where the children have no idea how much money the parents earn/have nor how much they spend on what.

In addition, children and parents may not live in the same area where they would be able to visit very frequently and see any major changes, at least with purchases or spending habits.

The warnings assume complete 100% openness between family members in every area of their lives. They assume an access that may not be available.

This is not to say that the warnings and advice are not good ones or ones that you should think about. It is to say that finding out the information that would give the warning can be highly limited or non-exsistent.

Orthonomics said...

I completely disagree ProfK. Never, where I have seen any of the vulnerability signs, have finances been an open subject. These things do have a way of coming to light, no snooping needed. But once there are stacks of turn off notices, the situation can't be simply ignored.

ProfK said...

I'm not saying to ignore what can be plainly seen SL. I am saying that the signs are not always so plainly seen. And children are not always around their parents enough to see the stray sign. For 22 years my mom lived in Florida while we children were in NY and California. She was fine apropos of her finances, but if she had not have been? If a neighbor or friend down there had known how to get hold of one of us or actually would have thought to contact us that would be one thing. On a visit with her we might have noticed stacks and stacks of bills and turn off notices. We would notice turned off phone service. But the rest? Short of snooping through all her records it would not have been all that easy to discover a trouble in the making.

Where there is constant contact the signs may well be visible, but when there isn't that contact? Not so easy to ascertain.