IN 2017, financial institutions filed 63,500 inquiries regarding suspected fraudulent activities involving senior clients. That’s up 400% over 2013, and may still represent 2% or less of actual crimes.
Traditionally, the elderly have been victims of their own family and care-givers. Now there are concerns that they are being victimized by financial professionals they trust, including lawyers, insurers and financial advisors.(1)
“Already targeted by phone scammers and greedy relatives, elderly Americans have a ‘bull’s-eye’ on their backs, one Iowa assistant attorney general who specializes in elder abuse cases said, adding that the problem is only getting worse.”(1)
Some of the issues involve premeditated crime. Some may simply involve incompetence. A person can spend one week studying, take a test, and presto! be certified as a financial planner. That doesn’t mean they actually know what they’re doing. There are advanced certifications that do mean something, but most FPs don’t have them and most consumers don’t understand them.
If you’re older, you need someone with you when you meet with a prospective advisor or care-giver, and you need to check that person’s credentials carefully. Someone “who seems nice” doesn’t cut it anymore.
In my practice, I try to be transparent in everything I do and avoid handling client funds. I have companies bill them directly or arrange electronic payment. As soon as applications are resolved, I shred all documents with any Personally Identifying Information (PII, yes, that’s a thing) unless retention is required by law. That information is stored in a portable storage device that lives in a fireproof safe.