A Tale of Deceit: Exposing Elder Financial Exploitation

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A Tale of Deceit: Exposing Elder Financial Exploitation

It started as an office visit by a family to probate the estate of their late brother who had recently died of cancer. But what appeared to be a simple probate case evolved into something more. Much more. From one three-page document, a durable power of attorney, a neighbor of the victim (“Ron”) was able to steal over $1.5 million dollars in the 57 days before Ron died. The case shined a spotlight on an issue plaguing the United States – elder abuse. Elder abuse is more than physical or emotional. As you will read from this case, it often involves elder financial exploitation.

According to the National Council on Aging, approximately 1 in 10 Americans aged 60+ have experienced some form of elder abuse. Some estimates range as high as 5 million elders who are abused each year. Sadly, one study estimated that only 1 in 14 cases of abuse are reported to authorities.

The family told the attorneys at Manning & Clair that something wasn’t right with their late brother’s affairs. They was suspicious of a ‘helpful’ neighbor who seemingly was speaking on behalf of their brother. And they were right.

The Road to Deceit

The victim (“Ron”) was an elderly gentleman who had worked hard his entire life and saved his money. He did not spend it on frivolous and extravagant things. He also valued his family, especially his sister Elsie who lived nearby. Most of his family, however, did not live close to his Summit County (Ohio) home. Ron’s diligent financial management allowed him to accumulate savings exceeding $1.5 million. But exactly two months before his death, the ‘helpful’ neighbor swooped in and picked away at his money.

After both he and his sister had taken ill, Ron started the process of purchasing his sister’s home (where he was living) to ensure she would always have a place to come home to. He became his sister’s guardian and gained a limited power of attorney (POA) to execute the real estate deal.

During this time, the neighbor offered to assist Ron gather the proper documents to make his plan a reality. When Ron broke his leg in August and had to enter a rehab facility, the neighbor struck and struck hard. She took control of his cell phone and started going through his bank statements. This is when she learned of his extensive savings.

With Ron’s health rapidly declining, the neighbor sent his attorney an email. It stated that she and Ron “had a long talk today (and) we won’t be needing your boss. We got it taken care of and I will let you know what is going on.”

Instead of having Ron’s attorney prepare the limited power of attorney solely to accommodate the transfer of the property, the neighbor had another idea. She contacted another attorney to grant unlimited power of attorney, naming her as Ron’s sole agent.

How the Elder Financial Exploitation Was Done

Armed with the fraudulently-obtained POA, the neighbor visited Ron in the hospital. She brought along a notary public and had him unknowingly sign away his rights. This started the process of draining his life savings and conspiring to isolate Ron from his family.

The neighbor, a convicted felon for crimes of dishonesty and moral turpitude, enlisted her family members and friends in the scheme. She had her accomplices watch Ron while she went to various banks and transferred monies from one to another and changed beneficiary designations on accounts.

What other acts of deceit and elder financial exploitation did she and her accomplices engage in?

  • The neighbor misrepresented herself to doctors and caregivers as his daughter.
  • The neighbor took control of cell phone and kept family members at a distance.
  • She went to a local jewelry store and purchased $8,400 worth of merchandise using his credit card.
  • She wrote checks to an accomplice and her accomplice’s sons totaling $139,000 and paid off their credit card bills.
  • After withdrawing hundreds of thousands of dollars – $146,000 on one day – she distributed it her fiancée (a $90,000 check), family members and friends.

The capper was in the days following Ron’s death, the neighbor charged his credit card at a West Virginia casino, made purchases on Apple iTunes and engaged in 28 transactions on Ron’s bank accounts.

Within two  weeks  of Ron’s  death,  the neighbor reaped the benefit of $578,778 from her fraudulent acts and self-dealing.

The Result of the Elder Financial Explotation

Following Ron’s death, his family collected his personal documents, only to discover the neighbor’s brother living there. Then, they realized something wasn’t right when they found the bank statements.

The wheels of justice started to turn when the family enlisted the services of Manning & Clair. When contacted, the neighbor initially said she knew nothing of Ron’s financial situation. We realized full extent of the damage months later.

Manning & Clair filed a complaint in against the neighbor and a Summit County judge ordered her assets frozen. During the discovery process, we learned that the neighbor had once worked as a paralegal. So, there was a level of sophistication to her devious plans.

The result of the civil action was a judgement against the neighbor and a $700,000 settlement. But, almost a $1 million of Ron’s savings were gone for good.

Lessons Learned

Why wouldn’t a bank notice and stop the elder financial exploitation? According to our attorneys, if a POA is present and appears to be legitimate, a bank is unlikely to challenge it. And while laws exist to protect the elderly from these situations, law enforcement is often unable to dedicate the necessary resources to investigate.

Remember to stay close to elderly relatives, especially during the COVID-19 pandemic when seniors are more isolated than ever. Don’t be afraid to challenge individuals who appear to be ‘too close’ or too willing to help. If you suspect something, enlist the services of our experienced probate attorneys.

Next: How to Spot the Warning Signs

Now, learn how to spot the red flags and warning signs of elder financial exploitation. Click here to read our follow-up blog post.