Financial Elder Abuse: The Big Picture, Part I

Seven years. That is the amount of time it took Father Pete Valdez to embezzle $284,000 from 79-year-old Michalana Jones.

After Jones’ husband died in 2003, Valdez befriended Jones and slowly began to scam her out of her savings. Valdez used $150,000 of Jones’ money to buy a home and convinced Jones to attach his name to her checking account.

It was easy for Jones to fall for the scam because she was a dedicated and devout Catholic. She felt it was her duty to obey the Roman Catholic Clergy.

The thefts were not discovered until Jones’ son took over her finances in November of 2011. By that time Valdez had stolen $284,000.[1]

What is Financial Elder Abuse?

Financial elder abuse occurs when a person or entity takes, secretes, appropriates, or retains (or assists in taking, secreting, appropriating, or retaining) “real or personal property of an elder or dependent adult to a wrongful use or with the intent to defraud, or both.

Recent studies have shown that financial elder abuse is a major problem in today’s society, one that is often overlooked. Of all the reported abuse against seniors, 40 percent is specifically financial abuse. In reality this percentage is most likely higher being that only 1 in 25 incidents of financial elder abuse is actually reported each year.[2]

This issue is not going away anytime soon; in fact, Paul Greenwood of the San Diego District Attorney’s Office says that this is an increasing problem. Over the next 5-10 years, financial elder abuse is expected to rise drastically. [3]

Who are the Victims?

Statistics indicate that financial predators heavily target people over the age of 65. Specifically between 80 and 89 years of age. While senior citizens of both genders are considered vulnerable targets, females are twice as likely to be affected.[4]

Other conditions and factors that increase the risk of becoming a victim include:

  • Isolation
  • Loneliness
  • Recent Loss
  • Physical or mental disabilities
  • Lack of familiarity with financial matters
  • Have family members who are unemployed

Why Target the Elderly?

Despite teachings from nearly every religion, and morality in general about honoring our elders, criminals are simply opportunistic.  They target the elderly for the following reasons:

  • Persons over the age of 50 control over 70% of the nation’s wealth
  • Many seniors do not realize the value of their assets (particularly homes that have appreciated markedly)
  • The elderly are likely to have disabilities that make them dependent on others for help. These “helpers” may have access to homes and assets, and may exercise significant influence over the older person
  • They may have predictable patterns (e.g. because seniors are likely to receive monthly checks, abusers can predict when an elderly person will have money on hand or need to go to the bank)
  • Severely impaired individuals are also less likely to take action against their abusers as a result of illness or embarrassment
  • Abusers may assume that frail victims will not survive long enough to follow through on legal interventions, or that they will not make convincing witnesses
  • Some elderly people are unsophisticated about financial matters
  • Advances in technology have made managing finances more complicated

Want to Know More?

We would like to personally invite you to attend a luncheon that will further discuss Forensic Accounting in Financial Elder Abuse Cases. This meeting will take place on Thursday, April 18.

Some of the topics that will be discussed include, applicable laws, overview of the forensic accounting process relevant in this setting, fiduciary duty versus specific intent and the type of evidence analyzed in financial elder abuse cases.

For more information on this event check out our Facebook page, stay tuned to our blogs or email me at Clint@balarskyandassociates.com.



[1]. Pfeifer, Stuart. “L.A.-area Priest Stole $284,000 from Elderly Widow, Suit Alleges.” Los Angeles Times. Los Angeles Times, 25 Aug. 2012. http://articles.latimes.com/2012/aug/25/business/la-fi-priest-fraud-lawsuit-20120825.

[2]. Birkel, Julia L., John M. Byrne, and Susan I. Benatz, Dr. Litigating Financial Elder Abuse Claims. N.p., Oct. 2007. Web. http://www.lacba.org/Files/LAL/Vol30No7/2416.pdf.

[3]. Weisbaum, Herb. “Financial Abuse Costs Elderly Billions.” Msnbc.com. N.p., n.d. Web. 05 Apr. 2013. http://www.nbcnews.com/id/41992299/ns/business-consumer_news/t/financial-abuse-costs-elderly-billions/.

[4]. Archer & Greiner. “Financial Elder Abuse Costs Nearly $3 Billion a Year.” JD Supra. N.p., Sept. 2011. Web. 05 Apr. 2013. http://www.jdsupra.com/legalnews/financial-elder-abuse-costs-nearly-3-bi-81481/.

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