12/10/2012

Elder Financial Abuse - Are You a Mandated Reporter?

Following is an article which I contributed to the Silicon Valley Chapter of the Society of Financial Service Professionals.   I am proud to be a Board Member of this organization. 


Elder Financial Abuse – Are You a Mandated Reporter?

The California Department of Justice estimates that approximately 1 out of every 20 elders are victims of abuse every year. However, it is difficult to determine the actual numbers of victims since elder abuse is one of the most underreported crimes. The lack of reporting occurs as a result of a number of reasons – embarrassment, fear, lack of capacity, or if the alleged perpetrator is a family member, fear that he or she will be prosecuted.

The California Legislature has responded to this lack of reporting by implementing a variety of reporting laws which address this issue and protect elders and dependent adults.

Elder abuse takes on many different forms, such as physical, financial, neglect, abandonment, and isolation. For purposes of this article, I will concentrate on financial elder abuse, the indicators of such abuse, and the reporting requirements.

First, financial abuse occurs wherein a person takes or misappropriates money or assets of an elder or dependent adult. This includes, but is not limited to theft or misuse of funds, extortion, duress, undue influence or fraud.

Welfare and Institutions Code section 15600, et seq. specifies what segment of our population is protected by the mandated reporting requirement. Mandated reporting of suspected abuse is required for any individual who is over the age of 65. Additionally, mandated reporting is required when the alleged victim is between the ages of 18 to 64 years old and has physical or mental limitations that restrict his or her ability to carry out normal activities or to protect his or her rights.

There are a number of professions that are specified as mandated reporters, including officers and employees of financial institutions. This includes direct employees and affiliated parties who review or approve an individual’s financial documents, records or transactions.

A mandated reporter must take appropriate action if he or she has observed abuse, has knowledge that abuse has occurred, there is a reasonable suspicion of abuse, or has been told by the elder or dependent adult that he or she has been a victim of abuse. If any of these have occurred, the mandated reporter must report the abuse within two working days and submit a report. The report must be submitted to the Adult Protective Services and/or the police. If the alleged victim is a resident of a skilled nursing facility, this report must be made to the Long Term Care Ombudsman Program. Failure to report, when circumstances deem it necessary, may result in the imposition of fines and possibly jail time.

There are many indicators of possible financial abuse. I have listed some indicators of possible financial abuse. This is not an exhaustive list, but merely a sample of some indicators of abuse. They are as follows:

• Confusion or lack of understanding by the older adult regarding financial affairs.
• Unusual activity in bank accounts or bank account activity that is inappropriate, for      example, withdrawals from the ATM when the elder or dependent adult is unable to walk or go to the bank.
• Unpaid bills when the caretaker is supposed to be paying those bills.
• Recent acquaintances expressing affection for a wealthy adult with assets.
• A caregiver who isolates the elder or dependent adult to gain control over the assets.

If a mandated reporter has observed indicators of possible abuse – he or she must properly document it. The mandated reporter must gather documents and information by other involved persons. It is not recommended that the mandated reporter confront the suspected abuser.

The mandated reporter must then contact the local Adult Protective Services office. In Santa Clara County, their telephone number is (408) 975-4900 or (800) 414-2002 (24-hour line) or the local police department. After contacting Adult Protective Services and reporting the abuse, the mandated reporter must submit a written report within two working days. This report form is entitled “Report of Suspected Dependent Adult/Elder Abuse” (SOC 341) or “For use by financial institutions – Report of Suspected Dependent Adult/Elder Abuse” (SOC 342). These forms can be found at the Department of Social Services website www.cdss.ca.gov If the abuse occurs in a Skilled Nursing facility, the mandated reporter must contact the Long Term Care Ombudsman Program at (408) 944-0567 or (800) 231-4024 (24 hour line).

So are you, as a financial professional, a mandated reporter? The answer is most likely yes. You may want to check with your company for further guidance.

Hopefully, the required reporting of this type of abuse will result in an actual reduction of those victimized.