CFPB: 36 Percent of Elder Financial Scams Committed by Family and Friends

CFPB: 36 Percent of Elder Financial Scams Committed by Family and Friends

While 51 percent of financial elder abuse cases involve strangers, approximately 36 percent are committed by people the victim knows and the average loss tends to be higher when the perpetrator is a family member or friend, according to an extensive analysis of Suspicious Activity Reports conducted by the Consumer Financial Protection Bureau.

The study – Suspicious Activity Reports on Elder Financial Exploitation: Issues and Trends – explores SARs filed with the federal government by financial institutions, such as banks and money services businesses, from 2013 to 2017.

Key findings include:

  • SAR filings on elder financial exploitation (EFE) quadrupled from 2013 to 2017, including 63,500 in 2017;
  • One third of the individuals who lost money were ages 80 and older;
  • Adults ages 70 to 79 had the highest average monetary loss ($45,300);
  • Losses were greater when the older adult knew the suspect. The average loss per person was about $50,000 when the older adult knew the suspect and $17,000 when the suspect was a stranger.

To help reduce elder financial exploitation, the CFPB report stated, “Depository institutions could prevent or limit losses by improving fraud detection technology to reflect transaction patterns most prevalent when older account holders become victims and by using machine learning to obtain specific and timely information indicating fraudulent activity.”

As a reminder, NRMLA offers a free consumer brochure that you can download and distribute to your clients that helps them recognize common scams and signs of financial exploitation. Download copies by clicking on the image below.