Last June we talked about California stepping up and strengthening it’s laws against elder abuse. As we’ve also discussed before, the bulk of the U.S. population lies with the baby boomers and the baby boomers are aging. The latest U.S. Census Bureau brief on data from the 2010 Census shows seniors increasing faster than the younger population, raising the nation’s median age from 35.3 in 2000 to 37.2 in 2010, with seven states having a median age of 40 or older. The point is that as the population ages elder abuse is probably going to increase as there will be more elderly citizens and more opportunities for fraud. Plan carefully and be aware of the standards for elder abuse in case you or a loved one find yourself in a possible abusive situation.
There are three different ways in which financial abuse may arise. Under California law Financial Elder Abuse occurs when property of an elder is taken for wrongful use, or with intent to defraud, or by way of undue influence. In other words, elder abuse can be established when undue influence is used regarding an elderly person’s Will or Trust.
Consider the story of Tom, the unscrupulous trustee, and Wendy, the elderly widow. Tom convinces Wendy to change her Trust and cut out her son because Tom feels the son, Sam, doesn’t deserve it. Of course, the change in the Trust also leaves something to Tom. And, just for flavor, we’ll add that, in reality, Sam has been a loving and caring son. After enough pressuring, Wendy succumbs to Tom’s bad intentions and makes the change. Now, after Sam finds out he has been disinherited, he sues Tom for elder abuse and undue influence of Wendy. This situation is the focus of the law.
What about the Veterans benefit situation in which the estate plan is changed to help qualify Mary, the Mom, for the Veterans Aid & Attendance Non Service Connected Disability Pension. This was the idea of Dolores, the daughter. To qualify for the Aid & Attendance benefit, it is necessary for Mary to bring her net worth way down. To accomplish this, she gives most of her bank account to Dolores. Bob, her son has ignored her for many years so Mary does not feel bad about this change. Dolores qualifies and receives the Aid & Attendance benefit of almost $1100 per month for the rest of her life. A few years go by and she dies. Dolores already has the money. Unfortunately, Bob, who was to receive half of her estate under her Living Trust, now gets nothing. Bob is upset. Is this Financial Elder Abuse? Assuming that this transaction was handled by an attorney who represented Mary, it is highly unlikely. But if it wasn’t, Dolores could be in for some problems.