Older adults are vulnerable to fraud and other forms of financial abuse. They may trust the wrong people, putting them at risk of losing the assets that they require for their comfort in their golden years.
Some people fall victim to investment fraud schemes, email phishing scams or inappropriate conduct on the part of professional caregivers. Others experience financial misconduct from the people closest to them. Familiar fraud is one form of financial misconduct that can do significant damage to an older adult’s economic stability in their golden years.
What is familiar fraud?
Most people understand the concept of identity theft. A party with questionable intentions uses another person’s private identifying information to pursue credit. Frequently, identity theft involves unknown actors using the internet as a means of gathering private information.
However, identity theft can involve immediate family members and close friends. Familiar fraud occurs when someone who knows an individual inappropriately secures credit in their name without their permission. The goal is often personal benefit for the party committing fraud, rather than the financial flexibility of the person whose name is on the account.
An adult child caring for their parent could commit an act of familiar fraud by opening a credit card in their parent’s name and then using it for personal costs rather than their parent’s needs. Familiar fraud often snowballs out of control and leaves an older adult theoretically responsible for a massive amount of debt that they did not accrue and cannot repay.
Regularly monitoring the financial transactions and credit history of vulnerable individuals can help people identify and respond to the financial abuse of elders. Familiar fraud can be particularly devastating, as it typically damages relationships in addition to the finances of the targeted adult.
