Financial Abuse of the Elderly – An Elephant in the Room

Financial Abuse of the Elderly – An Elephant in the Room

The Bermuda statistics on aging in Bermuda should be a wake-up call to all of us that our senior citizens require greater legal protection than our laws currently offer. By 2020 there will be 30 seniors (aged 65 and over) for every 100 persons of working age (aged 15 to 64). By the same year, there will be 75 men for every 100 women. Many senior Bermudians have relied on rental income from real estate to supplement their pension income. As we know, the Contributory Pension Fund is vastly underfunded, the rental property market is soft and seniors are being “encouraged” out of the job market. At the same time, many seniors are also providing for their children and grandchildren, who themselves are feeling the financial pinch. The combination of parental generosity, coupled with an aging parent’s increasing vulnerability, can have devastating consequences.

The most common types of financial abuse in Bermuda include abuse of powers under an Enduring Power of Attorney to effectively “steal” the assets of the senior and abuse of joint ownership of real estate, where the senior is, for example, either forced out of the property, limited in his or her use and enjoyment of the property or forced to co-sign on loans secured against the property. Similarly, in the case of joint ownership of bank accounts, cash and investments may be drained or transferred elsewhere, again being effectively “stolen”. In most instances, the senior has chosen to give authority, control or joint ownership to a child or children, thinking that this is the best estate planning option. The child or grandchild taking advantage of the senior often doesn’t recognise his or her behaviour as stealing. It may be that if the parent was always generous, the child sees his or her action as what the parent “would have wanted” anyway. Sometimes, it is explained away as being “owed” to the child in situations where the child has a sense of entitlement. And sadly, sometimes, the child doesn’t even try and justify his or her actions.

For the senior, it can be impossible to stop this treatment. He or she may be disabled, so as not to be aware, or to fully understand, what is happening and how it is happening. Or discovery of the theft may come too late. He or she may be entirely dependent on the abusing child for transportation, groceries and companionship. To call the behaviour out would risk alienation, abandonment, physical abuse or a possible loss of independence by being put in residential care.

The Senior Abuse Register Act 2008 was a public recognition of the vulnerability of seniors with a focus on abuse in residential care. It has many limitations, chief amongst them the fact that only the court can find “abuse”, which means the senior must find legal representation, notwithstanding possible lack of mobility, resources and independence, then navigate the court system and present as a credible witness. A protection order under the Domestic Violence (Protection Orders) Act 1997 may come too late to actually provide the necessary protection. Add to all of that the emotional stress of taking action against a family member and it is understandable why many victims of abuse will find it easier to keep quiet.

I will be inviting members of the community, who deal regularly with seniors, and members of the Bermuda Bar to join me on a committee to consider revisions to the law as it relates to seniors and financial abuse. I hope that I can find support for legislative change to amend and/or supplement our current laws so that less reliance need be placed on meeting the criminal standard to prove theft and fraud. In this regard, it may be desirable to expand on the notion of “financial misappropriation” as defined in the Senior Abuse Register Act 2008 so as to create an offence of “financial abuse against the elderly”, which need only meet the civil burden of proof. In addition, a more effective system of reporting and investigation is essential, as well as a speedier route to domestic violence protection orders. At the same time, a careful review must be made of the law dealing with powers of attorney, so that attorneys are supervised and held accountable for their actions. Eighteen states in the United States have enacted legislation addressing exploitation of the elderly. California has enacted legislation imposing a duty on banks to report suspected financial abuse of seniors and Maine has legislation making it possible to reverse property transactions that result from such abuse. There are many ways of targeting this problem.

In the meantime, we should all be mindful of the seniors in our lives, whether connected by family, neighbourhood, church or social group. Where there is cause for suspicion that something may be amiss, we should each take a measure of responsibility to look into the situation. Causes for suspicion include confusion, depression, lack of attention to hygiene and health, talk of fear of eviction or institutionalisation, expressed awareness of missing documents, or a sudden reluctance to talk. Over-attentive and solicitous strangers hovering around a senior can definitely be a cause for concern, but much abuse is perpetrated by family members, making it more difficult to detect what is genuine care and what might be “care” of the wrong kind. In the best of all possible worlds we would prevent elder financial abuse before it happens, rather than picking up the pieces afterwards. The truth is that we are all going to grow old. Wouldn’t it be nice to know protection was already in place when it’s our turn to be vulnerable?