King & Wood, P.A.

Can You Believe Elder Abuse Will Get Worse?

“Elder abuse will get worse, as 10,000 people turn 65 every day for the next ten years.”

With a growing number of retirees, older workers, and survivors, fragile older people are more susceptible to financial exploitation.

Wealth Advisor’s recent article, “Elder Financial Abuse Will Get Worse As Americans Age,” reports that, while there are thieves and legal exploiters, the root of elder financial abuse is in our retirement system.

For 40 years, the system has required people to save and handle very large sums of money to last their lifetime. In 2017, $14.5 trillion (85% of GDP) is in self-directed retirement accounts, which are prime targets for financial predation. In sum, our 401(k) and IRA system invites financial abuse.

We can caution people but, giving financial protection advice to older Americans with lump sums is not an easy thing to do. Many of the elderly are physically and mental impaired, socially isolated and have plenty of money.

Requiring professionals who handle IRAs to be fiduciaries, would have helped to prevent legal financial abuse. However, that regulation was recently overturned. As a result, professionals handling IRAs—the quickest-growing type of retirement account—are held to a lower professional standard. They cannot lie.  However, they also can manage your account without putting your interests first, because they’re not required to be fiduciaries.

A study by the Justice Department found that one in 20 older adults said they were financially mistreated in the recent past. In one year, the prevalence for emotional abuse among elders was 4.6%; 1.6% for physical abuse, 0.6% for sexual abuse, 5.1% for potential neglect and a 5.2% for current financial abuse. Experts say that this is an undercount, because it only considers abuse by family members.

The GAO also found elder abuse to be a widespread and growing problem. With a rule of thumb that we should accumulate 8-10 times our final salary in retirement individual-directed accounts (and no realistic option to acquire a fair and efficient lifetime annuity), elder financial abuse is far more prevalent in America than elsewhere.

Financial advisers will certainly become a source of financial abuse, a thought that concerns the industry. However, many legal practices, like selling inappropriate products, can occur when the adviser is not a fiduciary. Exploitation by financial institution employees may increase, as more and more elderly have cash nest eggs.

Reference: Wealth Advisor (September 11, 2018) “Elder Financial Abuse Will Get Worse As Americans Age”

Montana's Elder Exploitation Law is Too Vague, Judge Says

“A state judge has ruled that Montana's elder exploitation law is too vague and doesn't require evidence of criminal intent to prosecute.”

US News & World Report explains in its article “Judge Rule's State's Elder Exploitation Law Is Vague” that the judge’s ruling came last week in the case of an 80-year-old woman, Rose-Marie Bowman of Missoula.

She’s charged with taking money from an account for which she was a co-signor, after the other co-signor gave her control of his finances in 2012. The victim, Lanny Franzen, has been diagnosed with Alzheimer's disease. Missoula County Prosecutors say she manipulated Franzen into putting money into the account.

Attorneys for Bowman asked for the elder exploitation charge to be dismissed, arguing the law could be used to prosecute innocent actions. District Judge Robert “Dusty” Deschamps agreed, holding that the statute "is so broad and devoid of any requirements for proof of a criminal state of mind by the accused, a person is left to guess what specific acts might be allowed or prohibited by statute."

The prosecutors have several days to decide if they want to appeal the judge’s ruling to the Montana Supreme Court, file charges under another law, or drop the case. Missoula County Attorney Kirsten Pabst says she's consulting with the state attorney general's office.

Pabst commented that judges have previously struck down statutes, because of vagueness but this situation is still "unusual."

This type of exploitation, according to the statute, happens when someone knowingly “obtains or uses” an older, incapacitated, or developmentally disabled person’s “funds, assets, or property with the intent to temporarily or permanently deprive” the respective victim. In a motion to dismiss the case, Bowman’s attorneys argued that the vagueness of the statute lets prosecutors to pursue a son who accepts a gift from his elderly mother.

The issue hinges on the words “obtain” and “use.” These terms are not clearly defined by the state legislature concerning criminal exploitation.

Reference: US News & World Report (August 24, 2018) “Judge Rule's State's Elder Exploitation Law Is Vague”

Washington State AG Stops Trusts Mills

“CLA Estate Services, Inc. and CLA USA, Inc. made millions deceptively selling estate-planning services and annuities, in a scheme targeting Washington seniors.”

After a lawsuit filed by Washington State Attorney General Bob Ferguson, a King County Superior Court judge granted a preliminary injunction ordering an estate planning company to immediately halt its deceptive conduct. The suit asserts that the Texas-based company operated a “trust mill” scheme that preyed upon Washington seniors.

The Washington State Office of the Attorney General recently announced in a press release entitled “Court orders estate-planning company to immediately halt deceptive “trust mill” practices” that Ferguson filed an action against CLA Estate Services, Inc., CLA USA, Inc. and Mitchell Johnson, a former CLA agent. The lawsuit claims that CLA held misleading estate planning seminars and sold financial products in the state to seniors, without sufficiently disclosing that their products could lock up their assets for years and carried large penalties for early withdrawal. The products made CLA millions in commissions, at substantial cost to Washington’s elderly.

“CLA targeted seniors with their deceptive scheme, the opposite of giving them ‘peace of mind,’” Ferguson said. “They made millions through their trust mill scheme. This court ruling puts an immediate halt to CLA’s misleading and unlawful conduct.”

Judge Michael Scott granted a preliminary injunction that prevents CLA from conducting estate planning seminars and prevents both CLA and Johnson from marketing annuities to seniors who have bought the company’s “Lifetime Estate Plan” during the lawsuit.

CLA invited seniors to attend free meetings about estate planning, where their salespeople encouraged participants to set up living trusts and buy CLA’s “Lifetime Estate Plan” packages.  However, the ultimate goal was to obtain detailed financial information to sell complex financial products that most seniors didn’t understand. These “Lifetime Estate Plan” packages included a referral to an attorney and annual review meetings, where insurance agents, under the auspices of reviewing the estate plans, tried to sell life insurance and annuities. These annuities lock up seniors’ retirement savings, where they can only make nominal withdrawals during a deferral period, typically 10 years, without incurring high surrender penalties. Many seniors in the State of Washington incurred substantial penalties for early withdrawal of funds they needed for living expenses.

CLA failed to adequately disclose the terms of the annuities to clients. Johnson and other agents also provided investment advice to seniors, without proper registration.

CLA operates in at least 35 states. The company can still sell annuities to individuals who are not “Lifetime Estate Plan” clients but is prohibited from continuing their deceptive practices. They can also continue their annual review meetings with clients in Washington state, but can’t use these meetings to sell annuities or any other insurance product.

Reference: Washington State Office of the Attorney General (August 27, 2018) “Court orders estate-planning company to immediately halt deceptive “trust mill” practices”

Watch Out for These New Estate Planning Scams

“Bad advice. High fees. Trust mills. There's a lot to watch out for when you're planning for the future, including several new estate planning scams.”

Death brings out the worst in people, and unscrupulous advisors prey on the elderly and their heirs with questionable legal advice, unnecessary bills and the ever-present living trust come-ons.

Wealth Advisor reports in the article “Beware Of These New Estate Planning Scams” that new estate planning scams focus on taking advantage of an elderly person who may have reduced capacity. Scammers want to get seniors to sign over their property or sign a power of attorney to control the elderly person's estate. The most vulnerable senior citizens are those who have no close relatives.

Talk to an experienced estate planning attorney who can raise issues with you, make suggestions and pinpoint potential issues.

Work with a trusted estate planning attorney and tell your family what to expect when you pass away. If you don’t, you could lose a lot of money to a predatory third-party.

Another one of the new estate planning scams is the trust mills. The National Consumer Law Center says that these scammers are dishonest salespeople who prey on seniors’ fears that after their deaths, their life savings and assets will be stolen. In addition, both the Federal Trade Commission and AARP have issued warnings about these hard-sell living trust promoters.

The con artists who promote living trusts to seniors don’t want to help anyone plan for the future. Instead, they're trying to get their “clients” to hand over lots of money for their extra-special living trust kit. That’s one signal that a so-called estate planner is up to no good—they're offering a one-size-fits-all estate plan solution.

Experts also say you should beware of terms such as "Pure," "Pure Equity" or "Constitutional" Trust. These can be even worse than the living trust scams.

Stay away from these new estate planning scams. Don't take shortcuts and don't wait. Seek the counsel of a state bar-admitted estate planning attorney. He or she will work with you to find the best solutions for your specific needs.

Reference: Wealth Advisor (August 6, 2018) “Beware Of These New Estate Planning Scams”

New Bill Would Establish Team to Protect the Elderly at the SEC

“Legislation would establish a task force to examine challenges facing senior investors and recommend regulatory, statutory changes.”

The House Financial Services Committee has voted to approve the creation of an interdivisional task force at the Securities and Exchange Commission to protect senior investors.

Investment News recently published “House introduces bill targeting elder financial abuse.” The article reports that Representative Josh Gottheimer, D-N.J., introduced the National Senior Investor Initiative Act of 2018 to create a team of staff members from the SEC's Division of Enforcement; Office of Compliance, Inspections and Examinations; and Office of Investor Education and Advocacy. They would be responsible for examining the challenges facing elderly investors, focusing especially on the issues seniors have with financial services providers and investment products.

The task force would coordinate with law enforcement authorities, federal agencies, other SEC offices and state regulators, and report its findings every two years to the Senate Banking, Housing and Urban Affairs Committee, as well as the House Financial Services Committee.

The group’s objective would be to recommend specific regulatory or statutory changes that would help senior investors.

The bill also calls for the Government Accountability Office (the “GAO”) to study and report on the economic costs of the financial exploitation of senior citizens, within a year of the bill's enactment.

The law has a sunset clause that will end the task force after 10 years.

The full House subsequently passed by a 406-4 vote, the JOBS and Investor Confidence Act of 2018, also known as House Financial Services Committee Chairman Jeb Hensarling’s “JOBS Act 3.0,” which includes a package of 32 bills.

Representative Maxine Waters said the package included H.R. 6323, the National Senior Investor Initiative Act of 2018, which requires the SEC to set up the senior task force.

Reference: Investment News (July 10, 2018) “House introduces bill targeting elder financial abuse”

Virginia County Stepping Up Fight Against Elder Abuse

Virginia County Stepping Up Fight Against Elder Abuse “After discovering some elder abuse cases are difficult to prosecute, a southwest Virginia community is putting new emphasis on seeking justice for victims.” The National Council on Aging found that one in 10 Americans over the age of 60 has experienced some type of elder abuse. One southwest Virginia community has placed a new emphasis on seeking justice for those victims. Wise County, Virginia’s MDT which stands for “multi-disciplinary team,” recently gathered for the very first time. WJHL.com’s recent article, “Fighting elder abuse with collaboration, new 'MDT team' meets in Wise County, VA,” reports that the new MDT is made up of law enforcement, prosecutors, victim advocates, social workers and prosecutors in Wise County. Wise County Commonwealth's Attorney Chuck Slemp said this team is the type of collaboration already used in child abuse cases. "Well, why can't we do that same thing for elder abuse cases. We have the same difficulties in prosecuting them, they're under reported, they're under prosecuted and the victims have a hard time testifying, " Slemp said. Elder abuse cases, like child abuse cases, are often hard to prosecute. Elder abuse includes physical abuse, emotional abuse, sexual abuse, exploitation, neglect and abandonment. The perpetrators of this abuse can be children, other family members, spouses, and staff at nursing homes, assisted living and other facilities. Slemp said he sees extensive credit card fraud, with people opening up credit cards in the name of the other person and charging those up. The elderly or incapacitated person is then responsible for the credit card debt. He also confirmed what the National Council on Aging found: it’s frequently a family member or caretaker who's doing the abuse. In many instances, the victim doesn’t want that person prosecuted. In one month alone, Wise County Department of Social Services received approximately 40 reports of adult abuse, neglect and exploitation, of which 85 to 90% are 60 or older. Slemp hopes the new MDT new team will continue to effect change in fighting elder abuse. He sees it as a first step in a very large movement to protect senior citizens from those who would do them harm. Reference: WJHL.com (June 28, 2018) “Fighting elder abuse with collaboration, new 'MDT team' meets in Wise County, VA”

Virginia County Stepping Up Fight Against Elder Abuse

Virginia County Stepping Up Fight Against Elder Abuse

“After discovering some elder abuse cases are difficult to prosecute, a southwest Virginia community is putting new emphasis on seeking justice for victims.”

The National Council on Aging found that one in 10 Americans over the age of 60 has experienced some type of elder abuse. One southwest Virginia community has placed a new emphasis on seeking justice for those victims.

Wise County, Virginia’s MDT which stands for “multi-disciplinary team,” recently gathered for the very first time.

WJHL.com’s recent article, “Fighting elder abuse with collaboration, new 'MDT team' meets in Wise County, VA,” reports that the new MDT is made up of law enforcement, prosecutors, victim advocates, social workers and prosecutors in Wise County.

Wise County Commonwealth's Attorney Chuck Slemp said this team is the type of collaboration already used in child abuse cases.

"Well, why can't we do that same thing for elder abuse cases. We have the same difficulties in prosecuting them, they're under reported, they're under prosecuted and the victims have a hard time testifying, " Slemp said.

Elder abuse cases, like child abuse cases, are often hard to prosecute.

Elder abuse includes physical abuse, emotional abuse, sexual abuse, exploitation, neglect and abandonment. The perpetrators of this abuse can be children, other family members, spouses, and staff at nursing homes, assisted living and other facilities.

Slemp said he sees extensive credit card fraud, with people opening up credit cards in the name of the other person and charging those up. The elderly or incapacitated person is then responsible for the credit card debt. He also confirmed what the National Council on Aging found:  it’s frequently a family member or caretaker who's doing the abuse. In many instances, the victim doesn’t want that person prosecuted.

In one month alone, Wise County Department of Social Services received approximately 40 reports of adult abuse, neglect and exploitation, of which 85 to 90% are 60 or older.

Slemp hopes the new MDT new team will continue to effect change in fighting elder abuse. He sees it as a first step in a very large movement to protect senior citizens from those who would do them harm.

Reference: WJHL.com (June 28, 2018) “Fighting elder abuse with collaboration, new 'MDT team' meets in Wise County, VA”

 

Elder Abuse Alleged Against Spiderman Creator’s Caregiver

“A carer has ‘inserted himself’ into the Marvel Comics creator's life and is ‘isolating’ him from family, according to his lawyer.”

A temporary restraining order has been issued against Stan Lee's caregiver, because of allegations of elder abuse, as Sky News reports in the article, “Stan Lee's caregiver handed restraining order over 'elder abuse'.”

A lawyer for Stan Lee, the creator of many of the most successful Marvel Comics, says his caregiver Keya Morgan "inserted himself into Mr. Lee's life" following the death of Lee’s wife last year.

The petition for the restraining order was filed on Lee's behalf by his attorney Tom Lallas. The lawyer claimed that Morgan ousted him as the 95-year-old's lawyer in February of this year. According to court documents for the order, Morgan seized control of Lee's home and moved him to a condominium. He also hired security guards to keep family members and friends away.

In the petition, Lallas wrote: "Petitioner, along with law enforcement and Adult Protective Services, believes that Mr. Morgan is unduly influencing Mr. Lee and isolating him."

He added details of Lee's severe hearing and vision impairment, saying he requires round-the-clock care, and Morgan's actions amount to "elder abuse".

Lallas noted that Lee has a large estate worth more than $50M. As a result, the attorney said his client is vulnerable to financial predators.

Morgan was arrested on suspicion of making a false police report, after calling 911 to report a burglary at Lee's home. The call was made shortly after two police officers and a social worker had arrived to check on the elderly Lee’s welfare.

The restraining order was granted just days after Lee posted a video on his Twitter feed informing the public to get in touch with Morgan, if they wanted to speak to him. The tweet claimed that Morgan was the only person with whom he worked. Lee called Morgan his business partner and said they were conquering the world together. A hearing concerning the circumstances of the restraining order was set for July at Los Angeles County Court.

“I have taken great care of Stan Lee for the past many years, and have never had a problem directly with Stan. I have a fantastic relationship with him for the past many years, as he has stated countless times on the record and I literally saved his life once,” Morgan told TMZ. “I will 100% prove beyond a shadow of a doubt that the allegations against me are false.”

Lee is responsible for the creation of heroes like Spiderman, Iron Man, and the Hulk. He appeared in public at the premier of Black Panther, as recently as January of this year.

Reference: Sky News (June 14, 2018) “Stan Lee's caregiver handed restraining order over 'elder abuse'”

Georgia Wants to Improve Long-Term Care and Prevent Elder Abuse

“Experts say there are a number of signs and symptoms of elder abuse.”

According to AARP, 65.5% of Georgia’s citizens will be part of the state’s aging population by 2030. As a result, people are looking at ways to improve long-term care and to prevent elder abuse. Georgia Governor Nathan Deal signed two bills in May to help protect senior citizens from abuse, neglect, and exploitation.

The Albany Herald’s recent article, “Legislation should help prevent elderly abuse,” explains that elder abuse can manifest in different ways. It can occur in a nursing home, an assisted living facility or in a person’s own home with a designated health care provider. It can also be exploitation of a senior’s finances by a family member. If an elderly person is attacked by a care provider or even by another resident in a care facility, that’s elder abuse. It can be malnutrition or dehydration in a nursing home. Elder abuse can also be a fall in an assisted living facility. Another example of abuse is polypharmacy, where a caretaker puts an elderly resident on too many medications to restrain them or to curb their behavior.

Elder abuse is a problem that’s more common than most people think. The National Council on Aging says that an estimated 5 million, or one in 10, older Americans are victims of elder abuse, neglect or exploitation every year. Experts believe that for every reported case of elder abuse or neglect, as many as 23.5 cases go unreported. An Augusta Chronicle article reported that Georgia Bureau of Investigation Director Vernon Keenan said that more than 3,000 people in Georgia had been charged with crimes against the elderly since 2010.

To help address and prevent elder abuse, Georgia Governor Deal signed into law Senate Bill 406 and House Bill 803. SB 406 requires direct care employees of nursing homes, personal care homes, assisted living communities, private home care providers and adult day care centers to do FBI background checks and fingerprinting. HB 803 prohibits the trafficking of older or disabled persons and the practice of shuffling seniors to various facilities to avoid detection by law enforcement.

If a family is looking for a long-term care facility, the Medicare website has a Nursing Home Compare tool that rates every Medicare- and Medicaid-certified nursing home in the country. The website’s ratings look at quality of care indicators like health inspections, staffing, and quality measures. Details on penalties a nursing home has sustained, are also available.

If a relative is already in a long-term care facility, the signs of physical abuse include rough handling, injuries inconsistent with medical diagnosis or explanation and forcing someone to stay in a bed, chair or room. Indicators of financial abuse are missing money or valuables, checks and other documents being signed when the person can’t write, and unpaid bills when someone else is charged with paying for them for the person. Signs of neglect are bed sores or rashes, malnourishment and a lack of appropriate clothing for weather conditions.

Reference: Albany (GA) Herald (June 5, 2018) “Legislation should help prevent elderly abuse”

 

The DJ Casey Kasem’s Daughter Speaks on Elder Abuse Awareness

“Kasem and her siblings were banned from seeing or talking to their father, Casey, in the last years of his life. He was isolated and no law prevented the abuse.”

Kerri Kasem, the daughter of late Top 40 DJ Casey Kasem, recently visited the Waynesboro, VA area to speak on elder abuse. She spoke at the Seventh Annual Training of the Greater Augusta Coalition Against Adult Abuse.

The News Virginian reported in its story, “Kasem speaks against elder abuse,” that Kasem presented: “Isolated: How Casey Kasem’s Family fought, changed the law, and survived.”

Kerri Kasem, like her father, is an American radio personality. She hosted Sixx Sense and The Side Show Countdown with Nikki Sixx.

Kasem relayed her family’s story of the fight to see her ailing father. She explained about early warning signs of abuse and prevention. She also provided tips on how law enforcement and Adult Protective Services should approach these cases, for the victim’s rights to be protected.

“I learned very quickly there are no laws in the U.S. protecting adult children,” she said. “There needs to be stronger laws in this country protecting our elderly.”

Kasem fought to see her father and eventually created the Kasem Cares Visitation Legislation. The bill “provides an open path for family members to ask the court to rule on visitation, without incurring the enormous expense and time that comes with a challenge to guardianship or conservatorship,” the website explains. The bill became law in twelve states.

The organization is advocating for changes in the laws in Alabama, Arkansas, California, Illinois, Iowa, Louisiana, Maryland, Nebraska, Texas, Wisconsin and Virginia.

During her fight, many people contacted her in letters saying they were going through the same ordeal. She hopes the legislation and the Kasem Cares Foundation will help other people.

“I knew there were so many families going through this,” she said. “I couldn’t let them go through that. I knew I had to do something. That’s why I created Kasem Cares.”

Reference: The News Virginian (May 13, 2018) “Kasem speaks against elder abuse”