Elder Financial Exploitation

As chair of the Elder Law Section of the Utah State Bar, I am constantly impressed by the quality of speakers that present on behalf of our section.  Today, we listened to two prosecutors and the director of Adult Protective Services (APS) speak about Elder financial exploitation.  The incidence of financial exploitation of the elderly has increased by 50% between 2008 to 2010.  According to APS, the top 3 ways in which Utah seniors are exploited are as follows: (i) signing a quitclaim deed to their home;  (ii) adding a child or another individual to a joint bank account; (iii) unauthorized use of a durable power of attorney document.

According to APS and the prosecutors on today's panel, much abuse could be alleviated if an elderly individual had a third party to monitor their accounts for any circumspect use or charges, either by providing online limited access or by providing extra statements to the monitor.  Another suggestion our panel discussed was to give serious thought as to your agent under a durable power of attorney and the motivations of the agent.

 Although a durable power of attorney document can be the most useful and money saving document in an estate plan, as an attorney, I have seen serious abuse of durable power of attorney documents which has resulted in financial exploitation.  These documents are intended to be used (by statute) only for the benefit of the principal (eg. the senior). Criminal penalties  apply if the agent uses the document as a means of "stealing" from the principal.  The most important decision that you are making when you execute a durable power of attorney document, is the selection of a trustworthy "agent".  If possible, a senior should also seriously consider creating a durable power of attorney document which "springs" into life upon incapacity as certified by one or more physicians.  Serious consideration should also be given for the power conferred.  For example, if the power of attorney permits gifting (which is common where advanced estate planning/asset protection strategies are used), the decision to gift should be made by a special agent, who could make an impartial assessment as whether to the gift.

If you would like to read more about elder financial abuse and what to do about it, you may phone Utah Division of Aging and Adult Services at 1-877-424-4640 and request a legal guide.