"An estimated one in five older Americans have been financially exploited," according to an article in Barron's, describing the situation as an epidemic. While seniors are subject to a variety of scams, the majority of financial abuse "comes at the hands of family members, friends, or caregivers improperly using a retiree's money." In fact, "AARP found that financial exploitation by family members involves larger sums than those by strangers."
A common example is when an adult child is being compensated for the time she spends caring for an aging parent. Eventually, the child begins drawing additional funds for herself because she "deserves" it. An open conversation with the other siblings or family members can help provide transparency. Requiring more than one person to engage in, or review, financial transactions on behalf of seniors also helps.
It is important to be aware of the warning signs that someone you know may be vulnerable: