New Approaches to Preventing Financial Exploitation: A Focus on the Banks.

An 84-year-old man with mild to moderate Alzheimer’s disease can no longer manage his money or even shop at the local grocery store, but when taken to a bank, he signs a notarized reverse mortgage and loses $240,000 to his handyman who has secretly befriended the man over a 6-month period. What is needed for the financial services industry to help prevent financial exploitation of this type while simultaneously not infringing upon the rights of its customers? The largest increase in the older adult population in U.S. history is something to celebrate—yet, at the same time, current and future trends signal that financial exploitation is, and will continue to be, a significant threat for older adults. Intergenerational wealth is being transferred now at the highest rate in our history, which is a good indicator that the current older generation has significant wealth. Although anyone can be the victim of financial exploitation, declining cognition and early dementia are two of the greatest risk factors. The collision between an increasingly older population with high prevalence of cognitive impairment (Plassman et al., 2008) and those seeking to financially exploit them is rapidly increasing. Stiegel (2012) vividly described the fact that financial capacity and financial exploitation are connected. That is, that older adults’ vulnerability is twofold: (1) the potential loss of financial skills and financial judgment and (2) the inability to detect and therefore prevent financial exploitation. Dong (2014) argued that accurate assessment of financial capacity, and financial decision-making capacity in particular, is the cornerstone assessment in many cases of financial exploitation.