Posts in category: SNT

Reporting of Elder Financial Abuse

The National Center on Elder Abuse, under the auspices of the Administration on Aging, in summarizing a series of research studies on the incidence and prevalence of elder abuse and neglect (of all types), concluded that while data from state Adult Protective Services agencies shows an increase in the reporting of elder abuse, an overwhelming number of cases go undetected, unreported, and untreated each year. One such study estimated that only one of every 14 cases of elder abuse ever comes to the attention of the authorities. Another study found that for every case of elder abuse referred to social service, law enforcement, or legal authorities, 24 cases were not so referred.

Why is elder financial abuse so significantly under-reported? The most cited reason is that the victims themselves refuse to report the abuse to relevant authorities. The 2009 MetLife Study, Broken Trust: Elders, Family and Finances, suggested some of the following reasons as the basis for an elder’s refusal to report her victimization:

• The elder does not want her abusing family member to go to jail or to face public embarrassment.
• The elder does not want government interference in her personal life.
• The elder feels partially responsible for what has happened.
• The elder believes that the abuse is simply part of doing business or taking risks.
• The elder feels that admitting vulnerability will result in her being placed in a nursing home or other facility.
• The elder fears that the abuser will harm her even more if the abuse is reported.
• The elder fears that prosecuting the abuse will be prohibitively expensive.
• The elder may not recall the abuse because of dementia or other impairments.

Another factor underlying the significant under-reporting of elder financial abuse includes the reluctance of third parties to get involved for some of the following reasons:

• They do not know if they are “mandatory reporters” under their state laws.
• They do not want to compromise professional relationships.
• They wish to avoid adverse publicity to themselves or their organizations.
• They do not want to incriminate fellow professionals or employees.
• They want to avoid involvement in a criminal investigation or lawsuit.
• They are untrained on the distinction between “normal aging” and elder abuse.

“Mandatory reporters” of elder financial abuse can vary significantly from state to state. For example, Georgia law provides that the following persons having reasonable cause to believe that a disabled adult or elder person has been the victim of abuse, other than by accidental means, or has been neglected or exploited, are mandatory reporters of such suspected abuse, neglect or exploitation: any person required to report child abuse; physical therapists; occupational therapists; day care personnel; coroners; medical examiners; emergency medical services personnel; certified emergency medical technicians, cardiac technicians, paramedics, and first responders; employees of a public or private agency engaged in professional health related services to elder persons or disabled adults; clergy members (outside of the confessional); and any employee of a financial institution having reasonable cause to believe that a disabled adult or elder person has been exploited (for assets not being held or managed in a fiduciary capacity).

Only ten states and the District of Columbia specifically designate the employees of financial institutions as mandatory reporters of elder financial abuse. Numerous other states recommend and encourage, but do not require, the employees of financial institutions to report suspected elder financial abuse. As of 2013, there are no federal requirements that banks or other financial institutions must train employees to recognize or report elder financial abuse, even though they are well positioned to identify such abuse.

Penalties for the failure of mandatory reporters to report suspected elder financial abuse range from no penalty at all, to monetary fines, to jail time. In general, anyone who makes a report of suspected elder abuse, who testifies in any judicial proceeding arising from the report, who provides protective services, or who participates in a required investigation, is immune from any civil or criminal liability on account of such report, testimony or participation, unless such person acted in bad faith, with a malicious purpose, or was a party to the abuse.

Part 6 of this series will discuss Adult Protective Services agencies as the “first responder” mechanism for investigating reports of elder financial abuse outside of a long-term care setting, while Part 7 will deal with Long-Term Care Ombudsman programs investigating complaints in nursing homes or other long-term care settings.

Kristen M. Lewis, Esq., Member of the Special Needs Alliance and Fellow of the American College of Trust and Estate Counsel.

Commonly Cited Reasons for Elder Financial Abuse.

1. The incidence of Alzheimer’s Disease, and other dementias that undermine judgment, increases with age. Approximately 5.1 million Americans have some kind of dementia, including 200,000 under the age of 65. Close to 50% of all people over age 85 have Alzheimer’s Disease or another kind of dementia. Research indicates that people with dementia are at greater risk of elder abuse than those without the condition.
2. Diminished financial capacity is more prevalent as one ages (i.e. the ability to manage money and financial assets to meet one’s needs effectively), according to various research studies.
3. Elders have become largely socially isolated. Extended multi-generational families are no longer common in our society. Thus, there are fewer persons in an elder’s life who can realistically detect suspected financial abuse, allowing perpetrators to more readily create an environment that facilitates their crimes.
4. Family members who become dependent on an elder for financial support increasingly live with their elders permanently. Once entrenched in the lives of elders, these people have myriad opportunities to engage in financial abuse and exploitation.
5. Research suggests that the area of the brain known as the “anterior insula” changes with age and adversely impacts “gut feelings” about the trustworthiness of potential predators.
6. Elders with clinical depression are statistically more likely to be victims of financial abuse or exploitation.
7. Financial illiteracy is pervasive among Americans in general, and is especially marked among elders, according to research studies.

Profile of Perpetrators of Elder Financial Abuse.

The 2011 MetLife Study reported that 51% of the cases considered involved elder financial abuse by strangers, including home repair scams, telemarketing scams, and strangers committing robbery and burglary. Other studies also include in this category of stranger abuse mail or internet scams and identity theft. The 2011 MetLife Study theorizes that stranger elder abuse is more likely to be reported than abuse by known perpetrators.

Family, friends, neighbors, in-home caregivers and other known persons (e.g. Agents acting under Powers of Attorney) accounted for 34% of the perpetrators included in the 2011 MetLife Study. Also included in this category by other studies are legal guardians appointed by state courts, and Representative Payees under the auspices of the Social Security Administration. There are numerous factors that materially increase the risk of a person known to the elder engaging in elder financial abuse. Those include (i) use of drugs or alcohol, (ii) high stress levels and low coping resources, (iii) lack of social support, including respite care options, (iv) high emotional or financial dependence on the elder, (v) lack of elder care training, and (vi) depression.

Business and financial service providers account for 12% of the perpetrators reported in the 2011 MetLife Study, including insurance advisors, bankers, attorneys, building contractors, and nursing home administrators. Other studies include securities brokers and dealers, financial advisors, and “others in the financial services industry.” These perpetrators were involved with predatory lending, identity theft, embezzlement, and the sale of fraudulent investments or financial products or services which were unsuitable for the elder’s circumstances (e.g. long-term annuities). “Free lunch” investment seminars are also included in this category.

Medicare and Medicaid fraud is a fourth category of financial abuse perpetrated upon elders. While only 4% of the total cases considered in the 2011 MetLife Study, this amounted to 58% of the total losses sustained.

Sixty-percent of the perpetrators of elder financial abuse considered by the 2011 MetLife Study were male.

Part 4 of this series will consider common indicators of elder financial abuse.

Kristen M. Lewis, Esq., Member of the Special Needs Alliance and Fellow of the American College of Trust and Estate Counsel.

Definitions of “Elder” and “At-Risk Adult.”

There is no generally accepted age at which a person becomes an “elder.” Membership in AARP is open to persons 50 years of age and older. The Centers for Disease Control and Prevention (“CDC”) defines elders as persons 60 years of age or older, as do numerous state statutes. The Office for Older Americans of the Consumer Financial Protection Bureau is “dedicated to the financial health of Americans age 62 or older.” Numerous state statutes define elders as persons 65 years of age or older. The 2010 U.S. Census recorded the greatest number and proportion of people aged 65 and older in all of decennial census history: 40.3 million people, 13% of the total population. It is projected that by 2050, people age 65 and older will comprise 20% of the total U.S. population.

In addition to our elders (however defined), approximately 56.7 million of the 303.9 million people in the U.S. civilian non-institutionalized population, representing 18.7% of this group, reported a disability as part of the 2010 Census. Some type of disability was reported by 35% of men and 38% of women age 65 or older in 2011. These “at-risk” adults with disabilities are also often more susceptible to financial exploitation as a consequence of their disabling conditions. Nationally, 30% of adults with disabilities who utilized personal assistance services for support with activities of daily living report one or more types of elder abuse (i.e. physical, verbal or financial) by their primary care provider. For ease of reference in the balance of this blog series, the victims of financial abuse and exploitation discussed shall be generally referred to as “elders,” but other at-risk adults with disabilities of all ages shall be considered part of this vulnerable population for purposes of the discussion. Since women are nearly twice as likely as men to be the victims of elder financial abuse (as discussed in Part 1 of this series), the gender of these elders shall be assumed to be female.

Definition of “Elder Financial Abuse.”

Regrettably, there is no generally accepted definition of elder financial abuse or exploitation. The National Center on Elder Abuse (“NCEA”) defines elder financial abuse or exploitation as the “illegal taking, misuse, or concealment of funds, property, or assets of a vulnerable elder.” Additional definitions of these terms on the NCEA site include “theft, fraud, misuse, or neglect of authority or use of undue influence as a lever to gain control over an elder person’s money or property.”

The Federal Older Americans Act defines exploitation as the “fraudulent or otherwise illegal, unauthorized, or improper act or process of an individual, including a caregiver or fiduciary, that uses the resources of an older individual for monetary or personal benefit, profit, or gain, or that results in depriving an older individual of rightful access to, or use of, benefits, resources, belongings or assets.” The CDC defines financial abuse or exploitation as “the unauthorized or improper use or the resources of an elder for monetary or personal benefit, profit, or gain. Examples include forgery; misuse or theft of money or possessions; use of coercion or deception to surrender finances or property; or improper use of guardianship or power of attorney.” State statutory definitions of elder financial abuse or exploitation vary widely. However it is defined, it is estimated that financial abuse accounts for 30% to 50% of all forms of elder abuse, and is regarded as the third most commonly substantiated type of elder abuse (after neglect and emotional/psychological abuse).

Part 3 of this blog series will address commonly cited reasons for elder financial abuse and the profile of common perpetrators of elder financial abuse.

Kristen M. Lewis, Esq., Member of the Special Needs Alliance and Fellow of the American College of Trust and Estate Counsel.

I attended my first Lawyers with Purpose Annual Practice Enhancement Retreat last week, and experienced an “aha!” moment during one of the sessions facilitated by George Ira Carroll.

In the course of working with a partner to develop “my story,” and recounting to her the perpetual disarray in my personal life over the past two decades, I noted an amazing cause and effect in the success of my Special Needs Planning practice during that same period. Although my personal life was out of control, I was excelling in my professional life advising clients whose lives were also out of control because of their children’s disabling conditions.

Many, if not most, of the consequences of a child’s disability are completely beyond the control of the families into which these children are born. Those consequences run the gamut from medical to social, and leave these families grasping for even a scintilla of control in their otherwise chaotic lives. Enter the Special Needs Planning attorney, whose heartfelt mission is to provide these families with a semblance of control in an otherwise chaotic life. As the lack of control in my own personal life increased, so too did my passion for helping families achieve control in their personal lives by developing and implementing Special Needs Plans that help secure the futures of their children with disabilities.

My clients often remark on my passion for my Special Needs Practice, and now I can identify the source of that passion!

If you're a Lawyers With Purpose Member and want to listen to my webinar "Financial Abuse of Elders & Other At-Risk Adults" on the Member Site, hover over the "LWP Process" tab and choose the "Webinars and Teleconferences" folder. Go to Page 2 and scroll all the way to the bottom. If you are not a Member and would like to listen, email Molly Hall at mhall@lawyerswithpurpose.com and we'd be happy share!

Kristen M. Lewis, Esq., Member of the Special Needs Alliance and Fellow of the American College of Trust and Estate Counsel.

The Crime of the 21st Century

The financial abuse of elders, and other at-risk adults, is a societal plague that impacts persons in all social classes and economic strata: from a childless spinster living alone in her government subsidized studio apartment, to Brooke Astor in her opulent Park Avenue home surrounded by “caring” family members. The annual financial loss by victims of elder financial abuse is estimated to be $2.9 billion, a 12% increase from the $2.6 billion estimated in 2008. Women are twice as likely as men to be victims of elder financial abuse. Most victims are between the ages of 80 and 89, live alone, and require some level of assistance with health care, other activities of daily living, or home maintenance. Victims of elder abuse have a 300% higher risk of death when compared to those who have not been abused.

A 2011 study by the U.S. Government Accountability Office estimated that 14.1% of non-institutionalized older adults had experienced physical, psychological or sexual abuse, neglect or financial exploitation in 2010. Other studies estimate that one in six adults over the age of 65 has been the victim of a financial crime. Upwards of 5 million American adults over the age of 65 have been victims of elder abuse in all its forms. The “dehumanization of victims that takes place in the process of financial abuse . . . . creates an avenue to further victimization . . . . [T]he interrelationship between financial, physical, sexual and emotional victimization of elders is undeniable.” See The MetLife Study of Elder Financial Abuse: Crimes of Occasion, Desperation and Predation Against America’s Elders (hereafter referred to as the “2011 MetLife Study” (available at http://www.metlife.com/assets/cao/mmi/publications/studies/2011/mmi-elder-financial-abuse.pdf).

In the weeks ahead, we will investigate the scope and definition of elder financial abuse and exploitation; commonly cited reasons for this societal plague; the perpetrators of elder financial abuse; the detection and reporting of elder financial abuse; the remedies typically available where elder financial abuse has occurred; and finally, preventative measures that can be taken to forestall or eliminate elder financial abuse. 2013 is “The Year of Elder Abuse Prevention” (sponsored by the Federal Administration on Aging). I look forward to educating our blog readers – and the multi-disciplinary allied professionals who serve our elders – in the weeks ahead, which is a critical first step towards stemming the rising tide of elder abuse.

Kristen M. Lewis, Esq., Member of the Special Needs Alliance and Fellow of the American College of Trust and Estate Counsel,

After a period of being off-line while I developed an important new program on Financial Abuse of Elders and Other At-Risk Adults (more on that later), it’s good to be back on the Lawyers with Purpose blog. I recently became aware of a wonderful new blog called “Everyone’s Included,” the purpose of which is to share “stories that embrace the joy and power of people with disabilities.” Check it out at http://everyonesincluded.com. Everyone’s Included was created by Judith Moen, a former broadcast journalist and mother of an adult son with disabilities. This site affords families the opportunity to highlight their successes in overcoming the obstacles and fears that so often pervade their lives. For example, Judith’s post on February 22 described “Person Centered Planning” (“PCP”), a program supported by Atlanta-based All About Developmental Disabilities (“AADD”).

The PCP session was attended by her son and nine of his support team members, each of whom had an opportunity to provide insight and input into developing a roadmap for his success in the years ahead. Through a facilitated discussion, the team identified the challenges he would face and suggested practical problem-solving ideas and approaches. Each of the participants agreed to support him in the months and years ahead, and to reconvene as a group in three months “to celebrate the positive things that have happened and develop strategies to solve the negative.” To learn more about the PCP program supported by AADD, go to http://www.aadd.org.

In the weeks ahead, I’ll be sharing pearls of wisdom from my new program on Financial Abuse of Elders and Other At-Risk Adults, scheduled to be presented live to 1,000 attorneys and accountants when the Southern Federal Tax Institute meets in Atlanta October 21-25. Lawyers with Purpose will also feature a one-hour webinar on this important topic, hosted by yours truly on Monday, October 28, from 3:00 p.m. to 4:00 p.m. Mark your calendars! Registration information will be provided to members.

Kristen M. Lewis, Esq., Member of the Special Needs Alliance and Fellow of the American College of Trust and Estate Counsel.

The parents of children with special needs rarely have time for thoughtful contemplation of the daily challenges they face, so consumed are they with multi-tasking on myriad levels. Every once in a while, we are blessed with an inspiring look into the hearts and souls of these battle-weary warriors on what it means to be the parent of a child with special needs. Salma Ahsan, D.O., based in Athens, Georgia, is the parent of two children with special needs, and has lovingly penned the following reflection for the families she works with in her practice. She has agreed to share it with those of us who love and support these families as allied professionals.

“I know”

“I know how you felt when you were told you had a child with special needs;

I know the pain, fear, hope, and love in your heart;

I know that sometimes you feel like it is you and your child (or children) against the whole world;

I know how you felt when your child finally showed you they knew you were their mommy, either by a glance, a touch, through an assisted communication device, or even gloriously by calling you mom;

I know that no other mother knows on the level that we do, how glorious milestones are;

I know how angry and lost you feel when you fight for your child's rights against the school district;

I know how hopeless and lost you feel when you talk to doctors who don't understand or even care to understand;

I know the tears in your eyes when you can't let your child go out to play with the neighborhood kids;

I know the blade that tears through your heart when another child makes fun of your child's differences;

I know how you shut yourself in your room and scream or lay in bed all day because you just can't take it anymore;

I know that it doesn't matter how many degrees we have after our names or how much money we have, or what ethnicity we are, or where we live, our fight for our children's rights is still the same with its heart wrenching defeats and sometimes glorious victories;

I know that very few on this earth can see the beauty in our children like we do; because if they could just understand that the wisdom behind the eyes of our children is actually greater than many creatures on earth, then they would believe in them like we do;

I know that WE are the chosen ones; because the love we have for these children is actually God's love;

I know that what you will do in your fight for your child with special needs will change the world in ways that you may never know;

I know that I will always pray for your fight because your journey is my journey;

I have always known your heart, just like you know mine.

-Written by Salma Ahsan, for all my fellow mother warrior sisters”

It is my hope that these poignant insights will increase the compassion of those of us who work with these amazing families and make us more effective in our efforts to support them.

Kristen M. Lewis, Esq., Member of the Special Needs Alliance and Fellow of the American College of Trust and Estate Counsel.

Disinheritance is an outdated and incorrect approach to securing the future of persons challenged by disabilities.

I continue to be amazed (and dismayed) at recent reports by prospective Special Needs Planning clients that other professional advisors have recommended disinheriting a beneficiary to allow that person to maintain his eligibility for means-tested government benefits (such as Medicaid and Supplemental Security Income). Estate planners (and other allied professionals) who recommend the disinheritance of a beneficiary with a disabling condition often do so because they are unfamiliar with Special Needs Trust planning. Although they have a vague understanding that it is inadvisable for a variety of reasons to make an outright gift or bequest to a person with a disability, many traditional estate planning professionals are reluctant to develop new expertise in this complex emerging area of the law.

Rather than developing a proficiency in this area, or aligning themselves with co-counsel who can provide the necessary expertise, they recommend that the beneficiary with special needs be disinherited and provided for informally by other family members, typically adult siblings. Estate planning attorneys are increasingly held liable for legal malpractice for their lack of proper advice on how best to address the special needs of a beneficiary with a disability.

Do not leave the share of the person with special needs to another family member on an informal basis.

Able-bodied family members may claim that they are willing and able to manage on an informal basis the funds designated for the beneficiary with special needs. However, such a precatory arrangement cannot typically be legally enforced. The donee of the funds could maliciously withhold the benefits of the designated funds from the intended beneficiary, leaving the beneficiary with no legal recourse (and no funds to pursue any remedies).

Even well-intentioned family members may ultimately fail to manage designated funds for the benefit of the intended beneficiary with special needs. If the donee of the designated funds commingles the assets with his own, and thereafter (i) files for bankruptcy, (ii) becomes party to a divorce proceeding and a subsequent equitable division of property, or (iii) fails to pay his tax liabilities and becomes subject to a tax lien, the funds designated informally for the beneficiary with special needs could be dissipated entirely. These are but a few of the most common creditor traps that defeat the intention of clients trying to secure the future of beneficiaries with special needs.

A similar result could ensue if the donee of the funds set aside informally for the beneficiary with special needs predeceases him and (i) dies intestate with heirs-at-law that include persons other than the intended beneficiary, or (ii) dies testate but fails to make proper arrangements in the Will for the ongoing management of the funds for the benefit of the intended beneficiary. Since an estimated 70% of the population dies intestate, this is another very common flaw in a client’s plans to provide for beneficiaries with special needs. Although members of Lawyers with Purpose know that the Special Needs Trust is the cornerstone of securing the future of beneficiaries with disabling conditions, many allied professionals still render the outdated and incorrect advice described above.

Even in this Internet Era, where there is much accurate information on Special Needs Trust planning readily available to professionals and consumers alike, old (and incorrect) practices die hard! Feel free to forward this blog anonymously to someone you know who might still be dispensing this antiquated counsel. (That person – and his malpractice insurer – will be most appreciative!)

Kristen M. Lewis, Esq., Member of the Special Needs Alliance and Fellow of the American Academy of Trust and Estate Counsel.

For those estate planning attorneys and allied professionals who have little experience advising families with special needs issues, one of the biggest challenges is learning, appreciating and using “person-first” terminology when referencing the beneficiary with a disability and his consequent special needs. It does not matter how technically proficient an advisor may be if he or she alienates the client by utilizing outdated and disparaging terminology to refer to the person with the disabling condition.

Just as the “N-word” offends most people of good will, so too does the “R-word” (“retard” or “retarded”), which has only recently gained a similarly offensive status. State and federal statutes are increasingly amended to replace all forms of the “R-word” with more respectful terminology. A client of mine with the patience of Job illustrated the concept of person-first terminology as follows: “I don’t have a disabled daughter; I have a daughter with a disability. She isn’t “wheelchair-bound;” she uses a wheelchair to get around. She is not a “Downs child;” she’s a child who has Down Syndrome. She’s not “mentally retarded;” she “has a cognitive disability.” Her siblings without disabilities aren’t “normal;” they are “typical.” Using person-first terminology may seem cumbersome and unnatural at first.

Clients, however do take notice of those who successfully integrate this concept into normal speech. In time, the old terms that emphasized the disability first, instead of the person first, will become as offensive to the attorney, and to the other allied professionals with whom they work, as they have been to these families.

Overcoming this challenge will completely transform the way a family relates to, and communicates with, their professional advisors.

For a handy “cheat sheet” on the proper terminology to use when referring to individuals with disabilities, visit www.tcdd.texas.gov and download a wonderful “People First Language” handout (in English and Spanish) developed by the Texas Council for Developmental Disabilities. See also John Folkins, American Speech-Language-Hearing Association, The Language Used to Describe Individuals with Disabilities (Dec. 1992), available at http://www.asha.org/publications/journals/submissions/person_first.htm.

Kristen M. Lewis, Esq., Member of the Special Needs Alliance and Fellow of the American Academy of Trust and Estate Counsel