Trustworthy no more: family, friends are often culprits in elder fraud

In 2011, 77-year-old Barbara McEneaney realized she needed more help. Suffering from Parkinson’s disease, the New Hampshire woman experienced memory loss and mobility issues. So she added her brother, James Folley, as co-owner to her bank account. McEneaney had saved well, so she had more than enough in her life savings to pay the $4,000 monthly charges at an assisted living facility for a few decades.

Less than two years later, she was nearly penniless. The assisted living center facility agreed to reduce her monthly charge to avoid her having to leave. Authorities later found out who took McEneaney’s money—her brother and his wife.

James and Karen Folley were found guilty and sent to prison in 2018. They were ordered to pay $130,000 in restitution, but McEneaney would never see her money again. She died in 2017.

Cases like McEneaney’s are becoming more common. Last year, New Hampshire’s Elder Abuse and Financial Exploitation Unit documented a 71 percent increase in reports of elder abuse, neglect, and financial exploitation over the last five years. Much of that increase involves misuse of money, says Bryan Townsend II, the state’s assistant attorney general and the unit’s lead prosecutor. And the culprits are usually someone the victim knows and trusts—an attorney, a caretaker, a friend, or, like in McEneaney’s case, a family member.

Last month, the state announced it would expand its Elder Abuse and Financial Exploitation Unit, adding another prosecutor, an investigator, and a paralegal to the team. Townsend says this will allow the state to take action against the people who siphon savings from adults over 60 and help others detect signs of financial exploitation.

According to Townsend, reports of elder financial exploitation started rising significantly just before the pandemic. During lockdowns, scammers took advantage of retirees living alone, isolated from family members and others who would normally protect them. Family and friends, some struggling with financial issues, used their positions as powers of attorney or as caretakers to move money into their own bank accounts. As the pandemic eased, the elderly were more able to fend off anonymous scammers—but not their family and friends.

“The vast majority of our cases we take and prosecute are loved ones taking funds—financial advisers, attorneys taking money, trusted individuals getting their hands on money belonging to elderly folks,” said Townsend.

New Hampshire’s numbers reflect a similar rise in financial crimes afflicting the elderly throughout the United States. In June, the AARP reported that older Americans lose an estimated $28.3 billion dollars every year, and a majority of that money—72 percent—is taken by people the victims know and trust.

In many cases, exploiting an elderly family member is a “perfect” crime: Whether out of embarrassment or fear, most elderly victims will never report the loss to authorities. AARP estimated that’s true in nearly 88 percent of cases. Sometimes a cash-strapped family member coerces or threatens a loved one into giving away money, making an elderly victim even more reluctant to report.

In other cases, family and friends plan to pay back the family member, but then never do. Nan Mendenhall, director of Utah’s Adult Protective Services, also said 71 percent of the elder financial exploitation reports they receive involved thefts by trusted individuals.

“They may have borrowed the money with the intent of paying it back,” she said. “Then they realize that was too easy. And so they keep on doing it. Next thing you know, they’ve drained the bank account.”

Online scams against older Americans also grew at an alarming rate. The FBI reported that in 2022, more than 88,000 Americans over age 60 lost a total of nearly $3.1 billion in internet schemes—an 84 percent increase from the previous year. According to the bureau, most of those cases are perpetrated by strangers—think phony tech support emails, romance scams, and identity theft.

These sorts of crimes are also underreported. Since the scammers originate overseas and use fictitious names and concocted stories, they make it difficult for authorities to track them.

Late last month, the Department of Justice sentenced a dual U.K.-Nigerian national who, along with two others, deceived hundreds of older Americans into believing they would receive a multimillion dollar inheritance from a long-lost European relative. The fraudsters sent letters claiming to be bank representatives in Spain, and instructed recipients that, to receive the inheritance, they needed to send money for delivery fees and taxes. All told, the scam artists bilked an estimated $6 million from more than 400 victims.

Every U.S. state has mandatory reporting laws regarding elder abuse and exploitation, but definitions of mandatory reporters and elder abuse vary by state. And depending on how big the senior population is, a state may have less or more resources dedicated to combating the problem.

In California—which the FBI said saw the highest number of fraud victims and losses in the nation—a San Diego–based Elder Justice Task Force developed a data collection method that has helped authorities link multiple crimes and arrest ringleaders.

In Utah, Mendenhall said the state has hired a forensic auditor to handle increasingly complex cases and analyze bank records and added post-investigative services to prevent victims from being conned again. But the state ranked last in a 2022 WalletHub survey about elder abuse protections. When I asked Mendenhall about it, she said Utah doesn’t have an elder exploitation unit like New Hampshire or California, but said, “We’re not staffed like other state agencies, but we’ve become very creative with how we serve our clients.”

In New Hampshire, Townsend says their newly expanded team plans to prosecute more cases. Team members will continue to meet seniors wherever they are—at churches, retirement centers, assisted living communities, and libraries—to talk to them about the signs of exploitation. As the state’s elderly population grows, he predicts more adults will be prone to exploitation.

“The older you get, the more vulnerable you become physically and mentally,” Townsend said. “It’s just the way it goes.”