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April 01, 2019

Combatting Financial Elder Abuse

Elder financial abuse is an exploding problem in our society.  To give a flavor, according to a joint study by the National Committee for the Prevention of Elder Abuse, Virginia Tech University, and the Metlife Mature Market Institute – known as the Metlife Study – victims of elder financial abuse in the United States lost at least $2.9 billion (yes, that’s billion with a “b”) in 2010.  That represents a 12% increase from just two years earlier, 2008, when the amount was $2.6 billion.  And the problem continues to grow.

These numbers are low, as elder financial abuse is underreported, under-recognized, and under-prosecuted.  A 2011 study by Cornell University Medical Center, Lifespan of Greater Rochester, and the New York City Department for the Aging, found that 98% of incidents of elder financial abuse went unreported.

The growth in elder financial abuse is due in part to the demographics of our aging population.  Many baby boomers are vulnerable to exploitation because of Alzheimer’s disease and other types of dementia.  Moreover, seniors are often targets of financial exploitation because they have accumulated wealth during their lifetime, which they saved for their golden years.

According to the Metlife Study and other research, older woman in the United States are about twice as likely to be victims of financial exploitation as older men.  Most victims are between the ages of 80 and 89, live alone, and need assistance.  Cognitive impairment is a prominent risk factor.  

In other words, exploiters seek out and prey upon the most vulnerable and isolated members of our society.  The Metlife Study describes elder financial abuse as the “Crime of the 21st Century.”

My office, which serves as the last-resort public guardian for approximately 700 adults with cognitive disabilities in the Chicagoland area, has witnessed first-hand the boom in elder financial abuse.  We see such cases every day.  About 40% of our new intake cases have some financial exploitation component.  That is up from about 30% a decade ago.  Some of the individuals were swindled out of virtually every last cent.

To help combat this growing problem, we have a specialized unit of attorneys who focus their practice on complex financial recovery litigation against the exploiters.  This program is tremendously successful, having recovered more than $50 million over the past decade.  We are able to use the recovered funds to care for the individual under our guardianship.  In appropriate cases, we seek and obtain punitive damages against the exploiters.

In addition to recovering money for seniors, the program has called attention to the problem of elder financial abuse, as many of our cases have been prominently covered by the local, national, and even international news media.  

One recent example is a lawsuit we filed against Symphony Nursing Home, in Chicago, and five of its employees who stole $600,000 from a 97-year-old woman with dementia.  This represents almost all of her life savings.  The woman spent time in the Postom internment camp in Arizona during World War II due to her Japanese ancestry, even though she was born in the United States and has always been a U.S. citizen.  The five exploiters ranged from Symphony’s business manager and activities director at the top of its organizational chart to its receptionist and hairdresser at the bottom.  Symphony is part of a large chain of nursing homes in the Midwest run by Symphony Post Acute Care Network.

Banks are often in a position to first notice financial exploitation.  Here, a bank became suspicious of activities on the woman’s accounts, and contacted our office.  We became her guardian and, on the same day as our appointment, sued Symphony, its parent corporation, and the employees.  The case was front-page news in Chicago and was also covered in the national news media.1  We are currently vigorously litigating the case against the defendants to recover the stolen money.

In another recent case, we sued a priest who stole more than $300,000 from a parishioner who was in her 90’s and had dementia.  This was virtually her entire life savings.  The woman spent time in a Nazi internment camp during World War II and served for many years as the priest’s secretary.  As in the case against Symphony Nursing Home, bank personnel became suspicious of the large transactions and contacted our office.  We became the woman’s guardian and sued the priest.  

 After several years of discovery and litigation, we settled with the priest and he repaid the money.  The case was in the news during the litigation, and was on the front page again in October when the State’s Attorney’s Office in Chicago won an indictment against the priest.2  He faces up to 15 years in prison.

When our office’s social worker told the woman about the priest’s indictment, she was pleased.  She said that she was glad that the priest would not be able to do this to anyone else.

That leads to another point about our financial recovery program.  The State’s Attorney’s Office has a specialized unit that prosecutes crimes against elders, including financial crimes.  We work closely with this unit to ensure that exploiters are charged criminally in appropriate cases.  This partnership has resulted in many convictions of those who abuse the elderly.

One commonality of the two cases discussed above is significant.  In the majority of the cases we see, the exploiter is someone in a unique positon of trust or authority over the victim, such as a family member, caregiver, or religious leader.  This is consistent with national trends.

We believe that our financial recovery program is the largest in the country in terms of cases litigated (dozens every year) and amounts recovered (tens of millions of dollars).  We would like to see this innovative and highly successful program replicated in other jurisdictions.

1 Elyssa Cherney and Christy Gutowski, “Suit: Seniors Home Staff Stole $600K From Woman: Lincoln Park Workers Allegedly Preyed on Dementia Patient, 97,” Chicago Tribune, p. 1 (Sept. 7, 2018); Frank Main, “Document: Caregivers Looted $600K of Dementia Patient’s Cash: Filing Accuses North Side Nursing Home Employees of Stealing From 97-Year-Old Once Held in World War II Internment Camp,” Chicago Sun Times, p. 6 (Sept. 7, 2018); “Senior Home Workers Accused of Stealing From Resident: Several Workers at a Chicago Seniors’ Home Are Accused of Stealing More Than $600,000 From a 97-Year-Old Resident Suffering From Dementia,” U.S. News and World Report (Sept. 7, 2018); “Senior Home Workers Accused of Stealing From Resident,” Associated Press (Sept. 7, 2018) (this Associated Press story was published in papers coast-to-coast).

2 David Jackson, “Ex-Cleric Charged in Theft of $330K: Ukrainian Orthodox Alum Allegedly Targeted Nazi Camp Survivor,” Chicago Tribune, p. 1 (Oct. 26, 2018); Mitchell Armentrout, “Humboldt Park Priest Bilked Nazi Camp Survivor Out of 350K, Prosecutors Say,” Chicago Sun Times, p. 4 (Oct. 26, 2018).

Charles Golbert

Acting Public Guardian, Cook County, Illinois

Charles P. Golbert is the Acting Public Guardian of Cook County, Illinois, which includes Chicago and the surrounding suburbs.  He directs one of the largest public guardianship offices in the country, serving some 700 adults with cognitive disabilities and managing more than $100 million in estate assets.  Mr. Golbert has taught elder law as an adjunct professor at John Marshall Law School, and is a former Editor in Chief of the Journal of the National Academy of Elder Law Attorneys (NAELA Journal).  He has presented nationally and internationally about elder abuse, has published widely on the topic, and has served on local and national committees to fight the problem.

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