Category Archives: financial exploitation

10 Facts Funeral Directors Don’t Want You to Know

June 4, 2019

Funerals are among the most expensive purchases many consumers will ever make, ranking only behind the purchase of a home and an automobile. A traditional funeral, including a casket and vault, can start at around $7,000, although “extras” like flowers, obituary notices, acknowledgment cards or limousines can add thousands of dollars to the bottom line. Many funerals run well over $10,000.

But it’s possible to spend much less if you don’t let funeral directors pressure you into buying goods or services you don’t want or need. To help consumers resist such pressure and become more informed, Bankrate.com has compiled a list of “10 things funeral directors don’t want you to know.” The list is summarized below:

  1. Shopping around for funeral services can save you thousands of dollars.
  2. Funeral directors are not clergy. Although consumers tend to trust them implicitly and believe everything they say, it is well to remember that funeral homes are in business to make money.
  3. Embalming is rarely required when the person will be buried within 24 to 48 hours.
  4. Seeing your loved one prior to burial without the benefit of embalming will not leave you with unresolved grief issues. “If more people knew what embalming entailed, they would not choose to do it,” says Joshua Slocum, executive director of the Vermont-based Funeral Consumers Alliance, a not-for-profit consumer information and advocacy group.
  5. Sealed caskets, which add considerable cost, cannot preserve a body.
  6. A funeral provider may not refuse or charge a fee to handle a casket you bought elsewhere.
  7. You don’t need to spend more than $400 to $600 for a modest casket.
  8. You do not have to buy the funeral home’s entire package of services. You may pick and choose the services you want.
  9. You can plan and carry out many things on your own to honor your loved one without paying for services from a funeral home.
  10. Local funeral and memorial societies can help consumers find ethical establishments and often negotiate discounts for their members. For example, the Funeral Consumers Alliance has 115 chapters in 46 states around the country.

All funeral homes must comply with the Federal Trade Commission’s Funeral Rule. The Funeral Rule requires all funeral homes to supply customers with a general price list that details prices for all possible goods or services. The rule also stipulates what kinds of misrepresentations are prohibited and explains what items consumers cannot be required to purchase, among other things. For more on the rule, click here.

For the FTC’s series of articles on Shopping for Funeral Services, click here.

Bank Accounts and the Power of Attorney Designation

June 4, 2019

NAELA News:

Michael P. Affuso, EVP/Director of Government Relations, NJBankers

A power of attorney is a useful document for people to appoint someone to handle their financial affairs if, for some reason, they cannot do so themselves. It is one of the three important documents prepared by attorneys for their estate planning clients. This document allows the “agent” or “attorney-in-fact” identified in the document, to sign checks, open and close accounts, sell real estate, sign tax returns and other financial acts, on behalf of the “principal”, the person signing the document.

The agent is a fiduciary under the law. This mean that the agent must act in the best interest of the principal. Money belonging to the principal cannot be spent on the needs of the agent, or for the interests of the agent. If this duty is violated, legal liability may ensue. This raises the issue of how banks should designate an agent on the account of a principal.

Many times an agent will ask to be added to the account of a principal. Often, this is a daughter or son of a parent depositor. The power of attorney document will be presented, or the child will appear at the bank branch with the parent asking to be placed on the parent’s account. It is important that the agent not be added to the account as a joint owner, but as agent under a power of attorney.

Joint Owners Have Full Rights of Ownership

A joint owner of an account has an ownership right to all of the money in the account. If the account merely says, “Jane Smith and Susan Smith”, both can use all of the account proceeds for their own purposes, by law. This is not what the power of attorney intended, nor is it consistent with the legal duties of the agent. In fact, it is not an uncommon complaint that the agent took all of the parent’s money and disappeared, or used the money for their own needs. Financial exploitation by the elderly is common, and, statistically, it is often inflicted by family members.

Law enforcement officials are reluctant to pursue this type of theft because the joint owner has a legal right to take the money out of the account. The legal duties of the agent are irrelevant, because the account was jointly held. This would not be the case if the letters, “POA” appeared after the agent’s name on the account.

Joint Accounts Are Subject To The Liabilities Of The Agent

If an agent is placed as a joint owner on a bank account, such as a daughter on her mother’s account,  the account is subject to the liabilities of the agent/daughter. Any number of things can unexpectedly happen to the daughter and expose the mother’s money to creditors and others. For example, the daughter could be sued, file bankruptcy, get divorced or die. If this happens, the mother’s money in that account will be subject to pay the judgment, be placed under the control of the bankruptcy trustee, be involved in the divorce proceedings, or be part of the daughter’s estate. This could cause serious problems for the true owner of the account.

Properly Designate All Accounts By Using “POA”

If an account holder wants to add someone to their account as power of attorney, it is extremely important that the agent be designated properly. The agent should be designated on the account as “POA”. In this way it is clear that the son or daughter is acting on the account in a fiduciary capacity.

This will empower law enforcement officials to take action in the event of financial abuse and will protect the principal’s money from claims involving the agent. This designation of “POA” is crucial to avoiding the financial abuse of the elderly.  It will also prevent catastrophic loss of money belonging to the principal if creditors or others have claims against the agent.

 

Financial Institutions Report Widespread Elder Financial Abuse

March 29, 2019

The Consumer Financial Protection Bureau (CFPB) has released a report on financial exploitation of the elderly. The report compiles information from Suspicious Activity Reports (SARs) submitted by banks, credit unions, casinos, and other financial services providers.

Based upon the SARs, financial institutions have reported that financial exploitation of older adults by scammers, family members, caregivers, and others is widespread in the United States.

Key findings:

  • SAR filings on elder financial exploitation quadrupled from 2013 to 2017.
  • Financial institutions reported a total of $1.7 billion in suspicious activities in 2017, including actual losses and attempts to steal the older adults’ funds.
  • Nearly 80% of SARs reporting elder financial exploitation involved a monetary loss to older adults. The average amount lost was $34,200. In 7% of the cases, the loss exceeded $100,000.
  • One third of the individuals who lost money were ages 80 and older. Adults ages 70 to 79 had the highest average monetary loss ($45,300).
  • Losses were greater when the older adult knew the suspect.
  • More than half of SARs reporting elder financial exploitation involved a money transfer. The second-most common financial product used to move funds was a checking or savings account.
  • Checking or savings accounts had the highest monetary losses. The average monetary loss to the older adult was $48,300 in cases of elder financial exploitation involving a checking or savings account while the average loss was $32,800 in cases of elder financial exploitation involving a money transfer.
  • The elder financial exploitation took place, on average, over a four-month period.
  • Fewer than one-third of older adults who were exploited reported the abuse to a local, state, or federal authority. Only 1% of the SARs stated that the financial institutions involved reported the elder financial exploitation to a government entity such as adult protective services or law enforcement.

The report is is attached here –cfpb_suspicious-activity-reports-elder-financial-exploitation_report .  For additional information concerning elder abuse actions, visit:
https://vanarellilaw.com/will-contests-probate-litigation-elder-abuse-actions-2/

New Federal Law Puts Focus on Preventing Elder Abuse

May 1, 2018

Source: ELA news

A new federal law is designed to address the growing problem of elder abuse. The law supports efforts to better understand, prevent, and combat both financial and physical elder abuse.

The prevalence of elder abuse is hard to calculate because it is underreported, but according to the National Council on Aging, approximately 1 in 10 Americans age 60 or older have experienced some form of elder abuse. In 2011, a MetLife study estimated that older Americans are losing $2.9 billion annually to elder financial abuse. Continue reading