Patterns in Financial Exploitation of Vulnerable Adults Cases

Doug Chalgian, Certified Elder Law Attorney © 2014

Clients who meet with me about elderly family members who are being, or have been, financially exploited are often surprised when shortly into telling me their story, I can take over and fill in the details.  It happens a lot these days.  The clients say: “I guess you’ve been doing this awhile” or “I guess our situation isn’t so different after all.”  Both are true.  I have been at this awhile, and I have come to realize that there are patterns to these cases – facts that come up again and again.  Most often cases involve more than one of these factors.  Following are some of the most common:

Cognitive Impairment

It almost goes without saying that in many cases in which a vulnerable adult is financially exploited, the victim suffered from some form of cognitive impairment.  What is perhaps more surprising is the fact that this isn’t always the case.

In terms of cognitive impairments, the most common is memory loss often associated with Alzheimer’s disease.  But there are other varieties of impairments that commonly arise in these cases, such as frontal lobe dementia, stroke-related dementia, and alcohol-induced dementia.  Each of these, and several others, can impact the brain in a variety of ways.  Memory loss is one, but impaired judgment and loss of executive function can also play a role in causing an elder to become vulnerable to exploitation.

Forms of mental illness are also common among the aged population, and can cause elders to become vulnerable.  The prevalence of depression in the aged is high.  In addition, older folks suffer from the same variety of mental health disorders as the general population, including paranoia, anxiety disorders, and narcissism.  These conditions can combine with age-related cognitive impairments to exacerbate the situation and increase vulnerability.

In addition, elders who have relatively healthy brains, nonetheless are victimized.  Many of the reasons are explained in more detail below.  Often older people are simply more trusting, less suspicious, and lonelier.  These realities often cause elders to be easy targets.  As my law partner likes to say: “vulnerability and incapacity are two different things.”

Financial Dependence

Financial dependence is an insidious problem.  Children who “failed to launch” and those who launched but subsequently fell on hard times may find themselves looking for financial support from their parents.  This may be fine while the parents are fully competent and able to choose to help their struggling children.  But as the parents become impaired and vulnerable, it is common for the dependent child to take advantage of the situation and operate on the misguided assumption that because their parents supported them while they were competent, they would want to continue that support after they are no longer able to decide for themselves.

I explain to family members that just being old does not mean you cannot make bad decisions.  Young people make bad decisions all the time.  But once a parent is no longer capable of deciding whether their resources should be preserved for their own care or given to a struggling child, the law assumes that the resources should be preserved.  An established pattern of giving may be some evidence in a court proceeding regarding the exploitation of a parent, but it is not generally going to carry the day.  Unless the parent, while competent, created legal documents that expressly provide for a disadvantaged child after the parent becomes impaired, the Court will not presume that this was their intent.

Asset Preservation

Elders live in fear of seeing the resources that they accumulated during a lifetime of hard work dissipated on their care costs.  This fear is exacerbated by a well-established industry of lawyers and financial planners who put on so-called “chicken dinner seminars” to which elders are invited, and at which a presenter paints a bleak picture about the future if steps are not immediately taken to “protect their assets.”  These programs are designed to sell trusts and other legal products, as well as financial products that the presenters are offering.  What isn’t explained at these programs is that the loss of control of resources will impact the quality of care choices that the elder will have in the future.

Because these programs are so prevalent, in addition to buying into the products being sold at the seminars, the perception among the aged that they have to do something to protect their assets, leads to all sorts of bad decisions.  It also opens the door to self-serving strategies cooked up by overreaching children whose interest in preserving their parents’ resources is really about preserving their inheritance.  It is not uncommon for children to pressure parents to give them assets based on the proposition that they need to do so in order to avoid having their life savings lost, when in fact the strategy proposed does nothing to protect the elders, and only serves to benefit the children.

While there are appropriate times and strategies to protect assets for elders facing long term care costs, the concern over this issue, the amount of wealth being transferred, and the strategies commonly employed and promoted, are, in many (probably most) cases not in the elders best interests and are instead a common form of financial exploitation.

Care Services

Many elders are able to remain independent solely because their children (typically daughters) are willing to make great sacrifices by providing care to their parents.  That said, the awkward issue of when and how children should be compensated for such services often arises.  While in the vast majority of cases children performing such services ask for little or nothing in return, in a minority of cases the care-giving child may take advantage of a fearful and/or impaired elder to obtain an inappropriate financial benefit.   At its worst, such interactions amount to suggestions as brutally direct as “if you don’t give me (blank) I will have to put you in a nursing home.”  Of course, many times the appreciative parent desires to do something to benefit the care-giving child.  Unfortunately it is often difficult in these situations to discern the line between a purposeful gift to the care-giving child versus overreaching.

So-called “professional caregivers” can also be a source of exploitation.  The “dad married the caregiver” scenario isn’t just a movie plot.  It is not uncommon for elders who lose a spouse of many years (or decades) to suffer from depression, loneliness and insecurity- giving rise to vulnerability.  Where that elder needs assistance with their own care, or where they have become acquainted with a caregiver who was in the home during a period of care for the now-deceased spouse, relationships between elders and hired caregivers can lead to financial exploitation.  This fact pattern most commonly involves an older man and younger female caregiver.

Isolation and Alienation

In some families, most commonly second marriage situations, the person caring for an elder and seeking to exploit them, will take aggressive steps to alienate the elder from the family members that the exploiter perceives as being a threat to their objectives.  These situations commonly result in changes in estate planning documents by the elder during periods when they are under the control of the person abusing their relationship with them.  The elder often makes these changes after having bought into the portrayal of the other family members pushed on them by the exploiter.  For instance, a second wife might alienate a spouse from children of the first marriage by telling the elder that the children are after his/her money, or that the children want to place him/her in a nursing home.  Once the perpetrator has successfully bought into the storyline, the elder is asked to sign new estate planning documents, benefiting the perpetrator to the detriment of other family members.

This process of alienation is often associated with isolation and control.  In these cases, it is not uncommon for the perpetrator to convince the elder not to see the other family members, and/or for the perpetrator to listen to phone calls and review emails and other correspondence between the elder and the other family members.

Pride and Reserved Capacity

Perhaps somewhat surprisingly, the victims of financial exploitation are often high achievers, elders who in their work life were recognized as successes in business, academia and the arts.  The reasons that these types of individuals are often targets of exploitation are numerous, including:

  • They have resources.  Because of their success, they often have sizable estates which inherently attract the attention of people with bad intentions – people who exploit vulnerable adults.
  • They have troubled family dynamics.  High achievers are often type-A personalities.  As adults, they were driven to succeed, and a corollary of this quality is that they are critical and judgmental of people around them.  Often they failed to validate their children and others around them, leading to family dysfunction.  Alcohol and drug abuse is also more common in such families, as well as among the high achievers themselves.
  • They can fake it.  In the world of cognitive impairment there is the concept of “reserved capacity.”  That is, because they were so smart, when they become cognitively impaired, they can still operate at a reasonable level, often at a level that masks the true severity of their impairment.  These cases are particularly challenging to prove, since the victim may have appeared in many ways perfectly capable of managing their daily affairs, and unless there was a timely evaluation by a highly skilled medical expert, the ability to prove the elder was in fact vulnerable may be difficult.
  • They have big egos.  High achievers are often proud people who do not take their declining mental abilities sitting down.  They often rage against the proposition that they need help, or can’t make their own decisions.  Many of these cases will involve the vulnerable adult firing a series of doctors who suggest they may be declining, and turning on any family member who suggests they need help.


For lawyers, cases involving financial exploitation of vulnerable adults are uniquely tricky.  They often combine legal concepts with medical concepts with family dynamics.  The cases are typically brought at a time after the actions being contested occurred, and often relate to periods of time for which suitable medical evidence is unavailable. Nonetheless, the epidemic of exploitation in our aged demands these cases be handled and that attorneys educate themselves sufficiently to do so.