by Brian Mahany
The Treasury Department’s Financial Crimes Enforcement Network, better known as FinCEN, has joined the fight against financial exploitation of the elderly. FinCEN has long been the lead law enforcement agency detecting and combating money laundering. Because banks, retailers and many others are required to report large cash transactions, the agency is uniquely positioned to use its data gathering capabilities to look for signs of elder fraud.
Earlier this year, FinCEN issued a directive to financial institutions providing instructions on filing Suspicious Activity Reports (SARs) in cases of possible “elder financial exploitation.” The directive authorizes banks and other financial institutions to file SARs with FinCEN. These reports can be given to local law enforcement for follow up.
Because bank tellers often have a very personal relationship with their older clients, they are uniquely positioned to know when things don’t seem right.
Under the advisory guidelines, banks are encouraged to report erratic or unusual banking transactions involving elderly clients. These include:
- Frequent large withdrawals including maximum daily ATM withdrawals,
- Sudden insufficient funds activity,
- Uncharacteristic nonpayment for services which may indicate loss of funds,
- Debit transactions that are inconsistent for the customer,
- Uncharacteristic attempts to wire large sums of money, and
- Closing of CDs without regard to early withdrawal penalties.
Bankers are also encouraged to pay closer attention to both elderly customers and their caregivers. Common red flags include:
- A caregiver that shows excessive interest in the elder’s finances or won’t let the elder speak for herself,
- The elder shows fear or submissiveness to the caregiver,
- The bank is unable to speak with the customer despite repeated attempts,
- A new caregiver suddenly appears and takes control of the elder’s finances, or
- The elder lacks any understanding of his finances and is reluctant to discuss them.
While these seem like common sense guidelines, giving banks the ability and an easy method to report their suspicions will protect many elders from financial devastation. The new rules allow bankers to report their suspicions without fear of lawsuits.
By being able to electronically compare reports from other banks and financial institutions such as brokerage firms, law enforcement may be able to more quickly see a pattern developing involving an elder with accounts in multiple places.
Of course, as with any government monitoring program there are privacy concerns. With six months of actual experience, however, it seems most bankers are exhibiting good common sense and not reporting every grandmother who wires money to a family member. The initial results suggest that bankers are good at understanding when their customers may be in trouble.
Elder abuse and elder financial fraud are huge national problems. Earlier this year actor Mickey Rooney testified before Congress as to how he had been victimized by a step-son. Rooney, age 90, ultimately obtained a restraining order from a California court after he claimed he was both financially and physically abused by his step-son.
If you or a loved one are the victim of elder abuse, speak up! A government study says that 3 out of 20 non-institutionalized elders are the victims of some type of abuse each year. Those shocking numbers won’t decrease until more people come forward. Most counties have resources to help elders in need of assistance. Law enforcement is getting better at understanding the depth of the problem and taking action as well. If you have no one to turn to, call the police or even a trusted family friend.
The Mahany & Ertl law firm represents all types of fraud victims, including elder fraud. If you have been victimized by a family member or caregiver, don’t be ashamed to call us. All calls are confidential. For more information contact attorney Brian Mahany at (414) 704-6731 (direct) or by email at
Mahany & Ertl, LLC – America’s Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan and Portland, Maine. Services available in most jurisdictions.