As the senior population in the United States continues to grow, financial fraud and abuse of the elderly is becoming an increasing problem. According to a report by MetLife, financial abuse of the elderly resulted in $2.9 billion in losses in 2010. In many cases, scammers will tell their elderly victims that they need thousands of dollars for causes that turn out to be illegitimate. For instance, scammers often claim that they need money to help the elder’s loved one or to help the senior claim a large cash prize.
In a report, the General Accounting Office states, “As the U.S. population ages, growing numbers of older adults could be at risk of financial exploitation, so its potential impact on society is likely to increase.”
Seniors who have been taken advantage of financially are often too embarrassed to report the crime to authorities. As a result, employees at financial institutions, who often notice elderly customers withdrawing or transferring unusually large amounts of cash, are often the first line of defense against elder financial abuse. However, in the past, many employees at financial institutions were often afraid of violating federal privacy regulations by reporting suspected claims. The Gramm-Leach-Bliley Act (also known as the Financial Services Modernization Act of 1999) put privacy rights ahead of financial fraud protection.
Yet, in a report released in September 2013, eight federal agencies and departments jointly explained and clarified a customer’s financial privacy rights and the responsibilities that employees at financial institutions have. Richard Cordray, director of the Consumer Financial Protection Bureau (CFPB), one of the agencies that authored the report, stated, “reporting suspected elder financial abuse to the appropriate authorities is typically the right thing to do and generally will not violate the Gramm-Leach-Bliley Act.” The report also points out that financial institutions can release personal financial information to law enforcement officials who are investigating cases of financial elder abuse.
Thomas Curry, Comptroller of the Currency, said the report’s clarifications are positive. He remarked, “It will make a significant contribution to protecting elder Americans against financial fraud, which will help to provide great confidence in our financial system as a whole.”
The following are the eight federal agencies and departments that authored the joint report: the Board of Governors of the Federal Reserve System, the Commodity Futures Trading Commission, the Consumer Financial Protection Bureau, the Federal Deposit Insurance Corporation, the Federal Trade Commission, the National Credit Union Administration, the Office of the Comptroller of the Currency, and the Securities and Exchange Commission.
Website Resource: Financial abuse of elderly not trumped by privacy laws: feds, Today, September 25, 2013