Skip to content

Effort Launched to Protect Elderly from Financial Abuse

June 16, 2011

Effort Launched to Protect Elderly from Financial Abuse

For Immediate Release:  June 16, 2011

Minnesota joins national effort to protect vulnerable adults

ST. PAUL, MN - As the state's population continues to age, the Minnesota Department of Commerce announced today it is joining a successful nationwide effort to protect elderly Minnesotans from investment fraud and other financial scams that prey on vulnerable adults.

The Elder Investment Fraud and Financial Exploitation Prevention Program is an unprecedented national effort that educates medical professionals about how to identify senior citizens who may be particularly vulnerable to investment fraud, and then refer those at-risk patients to local Adult Protective Services (APS) professionals.

"Within this decade, there will be more Minnesotans over the age of 65 than children enrolled in our public schools," said Commerce Commissioner Mike Rothman. "By 2030, one out of every four people in our state will be 65 or older.

"With our aging population, bad actors will try to exploit vulnerable, aging adults. We recognize that threat. By participating in this proven program, our aim is to prevent financial abuse of senior citizens and provide another layer of consumer protection for vulnerable Minnesotans."

New medical research shows that more than a third of Americans over the age of 71 have mild cognitive impairment (MCI) or Alzheimer's disease, making them particularly susceptible to investment scams and other financial abuse.

"We now know that a shockingly large number of older Americans are already victims of financial swindles and millions more are in danger of being exploited in such a fashion," said Don Blandin, president and CEO of the Investor Protection Trust (IPT).

"Front-line medical professionals who deal everyday with older Americans are ideally positioned to spot the impaired mental capacity that can leave seniors vulnerable to financial abuse. This program seeks to inform doctors, nurses and others about the warning signs of elder investment fraud and financial exploitation."

According to the 2010 IPT Elder Fraud Survey, more than seven million older Americans - one out of every five citizens over the age of 65 - already have been victimized by a financial swindle. According to the IPT, con artists scam senior citizens out of $2.5 billion every year.

 "Senior citizens control 70 percent of the nation's wealth - and crooks know it," Commissioner Rothman said. For the financial well-being of Minnesota's most vulnerable consumers, it is important that we have the foresight to proactively put systems like these in place that will help identify financial abuse, and protect vulnerable Minnesotans from bad actors."

The EIFFE Prevention Program is based on a successful pilot program launched by the state of Texas. It is a collaboration between the Investor Protection Trust, Investor Protection Institute (IPI), North American Securities Administrators Association (NASAA), and National Adult Protective Services Association (NAPSA) in cooperation with leading U.S. medical associations, including the American Academy of Family Physicians, American College of Physicians, American Geriatrics Society, National Area Health Education Center Organization, and the National Association of Geriatric Education Centers.

The EIFFE Prevention Program was created by the Baylor College of Medicine, and is funded by a grant provided by the Investor Protection Trust. More information about the EIFFE Prevention Program is available online at http://www.investorprotection.org . You can also watch a short, informative video at: http://tinyurl.com/3zk2hbn .


 

Background
Senior citizens have long been the target of unscrupulous investment scam artists. This is especially true of seniors who have mild cognitive impairment (MCI). According to the 2010 Investor Protection Elder Fraud Survey released in June, 7.3 million older Americans - one out of every five citizens over the age of 65 - already have been victimized by a financial swindle. The IPT survey also found that half of older Americans exhibit one or more of the warning signs of current financial victimization.  For example, more than one out of three seniors (37 percent) are currently being pitched by "people (who) are calling me or mailing me asking for money, lotteries, and other schemes," while a much lower 19 percent of adult children believe that their parents are being pressured in such a fashion.

Of particular concern are seniors with mild cognitive impairment who can perform most daily functions, but have trouble or become confused with others, like following their medicine regimen and managing their finances. A 2008 Duke University study found that about 35 percent of the 25 million people over age 71 in the U.S. either have mild cognitive impairment or Alzheimer's disease. This makes them especially vulnerable to financial exploitation, including investment fraud. And researchers at the University of Alabama in Birmingham and University of Iowa have shown how older persons with cognitive impairment are more prone to make financial errors and willing to gamble with their money. In the earlier Texas pilot test, doctors taught by the Baylor College of Medicine team used the "red-flag" questions in the clinician's pocket guide to find and refer vulnerable older adults to help prevent fraud from occurring.


About the Groups
The Minnesota Department of Commerce (www.commerce.state.mn.us ) is a state agency responsible for consumer protection. Its mission is to ensure equitable commercial and financial transactions and reliable utility services by: regulating and licensing business activity in more than 20 industries; investigating and resolving consumer complaints; advocating the public's interest before the Public Utilities Commission; and administering various state programs.

The Investor Protection Trust ( http://www.investorprotection.org ) is a nonprofit organization devoted to investor education. The primary mission of IPT is to provide independent, objective information needed by consumers to make informed investment decisions. Founded in 1993 as part of a multi-state settlement to resolve charges of misconduct, IPT serves as an independent source of unbiased and non-commercial investor education materials. IPT operates programs under its own auspices and uses grants to underwrite important investor education and protection initiatives carried out by other organizations. The IPT provides investor education at both the state and national levels.

The Investor Protection Institute ( http://www.protectinvestors.org ) is a nonprofit organization that promotes investor protection by conducting and supporting research and education programs.

The National Adult Protective Services Association ( http://www.apsnetwork.org ) is a national non-profit 501(c)(3) organization with members in all fifty states, including the District of Columbia, the U.S. Virgin Islands, and Guam. It was formed in 1989 to provide state Adult Protective Services (APS) program administrators and staff, who are the first responders to abused elders and younger adults with disabilities, with a forum for sharing information, solving problems and improving the quality of services for these vulnerable victims.

NASAA ( http://www.nasaa.org ) is the oldest international organization devoted to investor protection. Its membership consists of the securities administrators in the 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Canada and Mexico.