The financial abuse of seniors is seldom discussed, but can have devastating consequences. For example, actor Mickey Rooney was said to have been a victim of financial abuse at the hands of his stepson. After being given power of attorney, the stepson drained millions of dollars from Mr. Rooney’s accounts, leaving him virtually penniless when he died on April 6, 2014.
The perpetrators of financial abuse are often family members or friends who have substance abuse, gambling, or financial problems. They may have had strained relationships with the victim in the past, leading to a sense of entitlement that overcomes any feeling of moral obligation towards the senior they are supposed to be looking out for.
If you are concerned about the risk of financial abuse, it is best to grant power of attorney to two people with the statement that both are to act in concert. This means that every document signed with power of attorney will require both signatures. Naming two attorneys in fact provides a system of checks and balances that discourages waste or misuse of assets. On a similar note, you can have co-trustees for your living trust.
If it’s not practical to have two people granted power of attorney or named as co-trustees, it’s crucial to make sure that another party is looking over bank account statements and canceled checks. If someone is making unexplained withdrawals or writing a check to themselves, that’s a definite red flag. Experts say a common pattern among those who defraud elders is to start with smaller transactions and increase the theft over time. What starts with a few blank checks often progresses to signing over a deed to the elder’s home or liquidating stocks and other assets.
If you do see evidence that leads you to suspect that you are a victim of financial abuse, you can fill out a simple form to revoke your power of attorney and name a new person to manage your affairs. Amending a living trust is a little more complicated, but your attorney can explain how to accomplish this in order to protect yourself. If you wish to prosecute the offender, California has some of the strongest elder abuse laws in the nation. Those who are found guilty of defrauding vulnerable seniors can be fined or sent to prison.
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Consulting an experienced estate planning attorney is the best way to ensure that you’ll be prepared no matter what the future holds. If you are in need of legal representation relating to an estate planning issue, please call our office at (626) 683-8113 or email us at info@PasadenaLawOffice.com.