Red Flags of Financial Exploitation
Friday, May 25, 2018 8:55 AM

Financial exploitation of older Americans and their families is a significant concern for credit unions and their affected members. According to AARP’s Banksafe Initiative Reports, older Americans and their families are valuable members, as they are responsible for 67 cents of every dollar deposited at U.S. credit unions and retail banks. AARP also reports that the average victim loses $120,000 and financial institutions lose $1 billion per year in deposits as a result of financial exploitation.

To help protect your older members and limit the loss of valuable staff time associated with these financial losses, we encourage credit unions to train their frontline staff to recognize suspicious activity on an account. Have staff discuss suspected exploitation with their supervisor and the member. Some examples of unusual activity outside of the member’s normal pattern include:

(1) Transactions by the family caregiver that do not seem to be in the interest of the member, such as excessive spending on travel or jewelry;

(2) A new, younger friend or sweetheart added to documents and accounts, sometimes followed by a large amount of money being transferred out of the account, or transactions at places the member does not frequent;

(3) Loans for a questionable reason, such as for a car when the member is visually impaired;

(4) Suspicious signatures on checks;

(5) Unusual or nervous behavior by the member and a reluctance to talk to you; or

(6) Withdrawals for reasons that are “too good to be true”, such as winning the lottery.

Source:  Texas Credit Union Department