Elder Abuse

Be Careful Granting Power of Attorney

Power of Attorney abuse has emerged as a serious problem for elderly people who are vulnerable to people they trust more than they should, reports the Sandusky Register in the article “Consumer beware: Understanding the powers of a Power of Attorney” The same is true for a Durable Power of Attorney for Health Care document, which should be of great concern for seniors and their family members.

Care should be taken when choosing an agent to act in your behalf

This illustrates the importance of a Power of Attorney document: the person, also known as the “principal,” is giving the authority to act on their behalf in all financial and personal affairs to another person, known as their “agent.” That means the agent is empowered to do anything and everything the person themselves would do, from making withdrawals from a bank account, to selling a home or a car or more mundane acts, such as paying bills and filing taxes.

The problem is that there is nothing to stop someone, once they have Power of Attorney, from taking advantage of the situation. No one is watching out for the person’s best interests, to make sure bank accounts aren’t drained or assets sold. The agent can abuse that financial power to the detriment of the senior and to benefit the agent themselves. It is a crime when it happens. However, this is what often occurs: seniors are so embarrassed that they gave this power to someone they thought they could trust, that they are reluctant to report the crime.

Similarly, an unchecked Health Care Power of Attorney can lead to abuse, if the wrong person is named.

The following is a real example of how this can go wrong. An adult child arranged for their trusting parent to be diagnosed as suffering from dementia by an unscrupulous psychiatrist, when the parent did not have dementia.

The adult child then had the parent admitted into a nursing home, misrepresenting the admission as a temporary stay for rehabilitation. They then kept the parent in the nursing home, using the dementia diagnosis as a reason for her to remain in the nursing home.

The parent had to hire an attorney and prove to the court that she was competent and able to live independently, to be able to return to her home.

Meet with an experienced estate planning attorney to discuss your situation and figure out who might become named as Power of Attorney and Health Care Power of attorney on your behalf. The attorney will be able to help you make sure that your estate plan, including your will, is properly prepared and discuss with you the best options for these important decisions.

Reference: Sandusky Register (Feb. 5, 2019) “Consumer beware: Understanding the powers of a Power of Attorney”

Suggested Key Terms: Power of Attorney, Health Care, Principal, Agent, Elder Abuse, Estate Planning Attorney,

Choose Power of Attorney Agents Wisely

For nearly four years, John Jerome O’Hara took charge of his mother’s care at a Kentucky nursing home. She suffered from Alzheimer’s disease.

O’Hara gained power of attorney over her affairs in June 2014. He was expected to manage thousands of dollars in income a month. In addition, O’Hara was supposed to use that income for his mom’s living expenses at Wesley Manor in Louisville.

However, reports The Washington Post in the article “He had power of attorney over his Alzheimer’s-afflicted mother—and stole $332,000, grand jury says,” for nearly four years, O’Hara robbed his mother instead. The charges contained 18 counts—ten of bank fraud, four of wire fraud and four of “access device fraud.”

The charges carry a maximum of several lifetimes in prison, the indictment said.

Each bank fraud count carries a maximum of 30 years in prison. In addition, there’s the potential for hefty fines and restitution.

O’Hara took the funds, in part, by writing checks to himself, according to the indictment.

He also wrote checks out to cash or signed “POA” for power of attorney. He withdrew money from her bank accounts to use for his expenses, prosecutors allege.

O’Hara’s alleged theft left a trail of financial distress, which was clear to investigators. Most significantly, he failed to pay his mother’s living expenses, the indictment said. This forced other family members to pay more than $100,000 to keep her cared for at the nursing home.

In addition, O’Hara left other obligations unpaid. He missed mortgage payments at his mother’s home in Lexington, the indictment said, and the home was foreclosed in March, as a result.

Reference: The Washington Post (December 9, 2018) “He had power of attorney over his Alzheimer’s-afflicted mother—and stole $332,000, grand jury says”

Spiderman Creator Stan Lee’s Estate Needs Untangling

It’s going to take more than a super hero to unravel the mess that Stan Lee left behind.

The passing of Stan Lee, famed Marvel Comics publisher and chairman, was sad for his legions of fans. For his 68-year-old daughter J.C., there’s grief and a challenging estate to be settled. His last years were hard, with ill health, the passing of his wife of nearly 70 years and accusations of sexual harassment from nurses and home aides.

Stan-leeIn addition, Lee reportedly said that $1.4 million dollars was missing from his bank accounts and that a large chunk of the money had been used to purchase a condo.

MarketWatch’srecent article, “Stan Lee’s tangled web of estate planning and how to avoid it in your own life,”reports that Lee had also hired and fired several business managers and attorneys in this time.

“I learned later on in life, you need advisors, if you’re making any money at all,” he told the Daily Beastin a 2018 interview. He also remarked that he’d done much of his own money management at the start of his career.

“But then, a little money started coming in, and I realized I needed help. And I needed people I could trust. And I had made some big mistakes. And my first bunch of people were people that I shouldn’t have trusted.”

It’s not known at this point, if Lee had a will or any trusts in place. If he did not, then he’s joining other late celebrities like performers Aretha Franklin and Prince who failed to draft these documents. As a result, their heirs and potential beneficiaries have had to go to court to straighten things out.

Keeping track of an estate plan can become harder as a person ages, because he or she could suffer cognitive decline, or a professional or family member may think he or she is suffering from this. Stan Lee was the subject of this type of inquiry: in February, he signed a document declaring that his daughter spent too much money, yelled at him, and befriended three men who wanted to take advantage of him, the Hollywood Reporterreported. However, a few days later, Lee took it back.

Seniors can become get less confident in what they’re doing, and they are more susceptible to the influence of others who may not have the best of intentions. However, you can easily create an estate plan with which you’re comfortable, with the help of an experienced estate panning attorney.

A big rat’s nest that will need to be addressed by Lee’s daughter will be dealing with the many business documents that may be floating around from his current and past business managers and attorneys. To avoid this, work with an estate planning attorney and ask some specific questions, such as:

  • How do we organize and simplify my assets?
  • Will we need a trust, and how will they be managed?
  • How will you coordinate with my executor and/or attorney-in-fact while I’m well, and after I’m sick or gone?
  • How do you determine cognitive decline in an individual? What would you do, if you believed my ability to answer questions and manage my funds was diminished? What would you do once you’ve made this decision?
  • How often will we review my beneficiary designations and estate planning documents?
  • How should we coordinate a team of financial and legal professionals to make sure all are working towards the same goals?
  • How much or how little information about my estate should be discussed with family members?

Reference: MarketWatch(November 17, 2018) “Stan Lee’s tangled web of estate planning and how to avoid it in your own life”

Family Members Charged with Felony Theft for Allegedly Stealing from Father

This is a sad reminder that much elder financial abuse takes place at the hands of family members. In this case, a son and daughter-in-law have been charged with taking more than $150,000 from the 86-year-old father.

Dauphin County Commissioner George Hartwick says that the fourth largest financial case since 2004 is now underway, reports Fox 43 in“Son charged for stealing $153,168 from 86-year-old father, officials talk elder abuse warning signs.” Chester Robert Garman III and his wife Kathy Alice Garman have been charged with felony theft and access device fraud for allegedly stealing from the man’s father over the course of four years.

MP900202201Dauphin County officials are using this elder financial abuse case as a reminder for the public to monitor those 60 and older for signs of abuse, neglect or financial exploitation.

Reports of elder abuse in the Pennsylvania county continue to rise every year. Thus far in 2018, county officials have received more than 1,600 reports of elder abuse.

"In Dauphin County we want to make it clear that if there are suspected abuses occurring, we will take actions," said Hartwick. "We are communicating, and we will do everything to make sure we are protecting out seniors and bring those individuals who perpetrate those crimes to justice."

It’s not uncommon in elder abuse cases—such as the Garman's—for a person familiar to the victim to be the bad actor, someone they know and trust. The Dauphin County Area Agency on Aging says there are many signs of abuse. If a person sees anything they think is questionable, they should call the authorities.

Elder abuse can come in many types:

  • Physical elder abuse: the non-accidental use of force against an elderly person that results in physical pain, injury or impairment;
  • Emotional elder abuse: causing the senior emotional or psychological pain or distress, like intimidation through yelling or threats and isolation;
  • Sexual elder abuse: contact with an elderly person without their consent;
  • Elder neglect or failing to fulfill a caretaking obligation;
  • Financial exploitation: unauthorized use of an individual’s personal funds or property; and
  • Healthcare fraud and abuse by unethical doctors, nurses, and other professional care providers.

The County’s District Attorney advises families to have a power of attorney put in place, especially if there is a caregiver who has access to the senior’s financial assets. The power of attorney provides a clear delineation of what the obligations are of the caregiver to the person receiving the care.

Reference: Fox 43 (October 22, 2018) “Son charged for stealing $153,168 from 86-year-old father, officials talk elder abuse warning signs”

Ohio Expands Mandatory Reporters of Elder Abuse

It makes sense that the people who come in contact with the elderly about their health and property be required to report any kind of elder abuse. After all, they are on the front lines where abuse often occurs.

Ohio has expanded the number of professionals who are now required to report elder abuse, adding bank employees, financial planners and notary publics, who you might expect to be on the list, as well as pharmacists, dialysis technicians, firefighters, first responders, building inspectors, CPAs and real estate agents.

MP900383004Their ability to spot issues from many different perspectives, increases the chances that more cases of elder abuse will be reported and addressed.

The Dayton Daily News’recent article, “This new law means many more Ohio officials are watching out for elder abuse. Here’s why it was passed,”explains that elder abuse can include exploiting another person’s resources; physical, emotional, or sexual abuse; or neglecting to meet a person’s basic needs. There were more than 16,000 reports of abuse, neglect, and exploitation of Ohio adults aged 60 and older in 2017. However, only one in 14 cases is reported, according to National Institutes of Health estimates.

“This expansion of mandatory reporters will help us in our goal of protecting our vulnerable family members, friends and neighbors from harm,” said Cynthia Dungey, director of the Ohio Department of Job and Family Services, which supervises Ohio’s Adult Protective Services program.

Financial institutions are one of the main places where exploitation can be recognized. Officials are educating tellers to identify the signs, such as an older customer appearing confused or distant or withdrawing unusual amounts of money.

Other signals of elder abuse can include seniors living in isolation, missing appointments, appearing frightened or avoiding specific people.

Whenever there is a dramatic change in behavior patterns, including a withdrawal from their usual activities, a change in mood or temperament or flinching at any kind of physical contact, elder abuse may be occurring.

Elder abuse risks increase when poverty, declining health, dementia, domestic violence or other traumatic events are present. The elderly person with no family, support system or access to community services is more likely to become a victim.

Reference: Dayton Daily News (September 29, 2018) “This new law means many more Ohio officials are watching out for elder abuse. Here’s why it was passed.”

LOVE Artist’s Estate in Litigation

The man who took care of Robert Indiana in the last years of his life, told a probate court hearing Wednesday that he was paid roughly $250,000 a year to tend to the aging artist, whose estate and legacy are now the subject of acrimony and lawsuits.

Under questioning by a lawyer representing the estate, caretaker, Jamie L. Thomas said he’d been earning $1,000 a week in 2013, when he started taking care of artist Robert Indiana, who lived alone on a Maine island, until his death in May at 89.

LOVEThe New York Times’ recent article entitled “Robert Indiana’s Estate: Generosity, Acrimony and Questions” reported that by 2016, Thomas said the artist had raised his salary to $5,000 a week for round-the-clock work that included bringing him meals, taking care of his dog and helping him to bed. He was also granted Indiana’s power of attorney.

Thomas said Indiana was a generous employer and that the artist had given him at least 118 pieces of art since 2010.

At the hearing, Thomas said that over the last two years he’d withdrawn $615,000 from Indiana’s accounts at his request. He didn’t say for what Indiana used the cash, but that the artist gave him $35,000 to buy a car.

James Brannan, the lawyer who’s the executor of Indiana’s estate, said he was surprised by the large cash withdrawals. Brannan said when he visited the artist’s home soon after his death, Thomas’s wife gave him a gym bag filled with $189,000 in cash. “This is yours,” she told him, “It belongs to the estate.”

Brannan isn’t certain if that cash is part of the $615,000 that was withdrawn.

John Frumer, the lawyer representing Thomas, said the hearing paints an incomplete picture.

“There’s much more to the story than it appears,” Frumer said. “Because it’s a limited proceeding, not all of the facts came out, and they will in time.”

Brannan asked the Knox County Probate Court to help clear up multiple questions that have swirled about Indiana’s finances in recent months. He said he wanted to clarify whether any money is owed to the estate, get an inventory of all the art works Indiana left behind and to address accusations that are contained in a separate lawsuit claiming Thomas and a New York art publisher made unauthorized works under Indiana’s name in recent years. That action was filed a day before Indiana’s death, by Morgan Art Foundation, an international dealer that claims the rights to many of the artist’s works, including the famous LOVE image. The suit claims that publisher Michael McKenzie and Thomas intentionally isolated Indiana from friends and business associates to sell inauthentic artwork attributed to him.

McKenzie said he had returned to the estate all the Indiana artworks that might belong to it. However, Brannan has said that he wants a full accounting of whether the Morgan company owes the estate money for royalty payments due on Indiana items it sold.

Indiana’s LOVE sculpture, with the letters stacked two-on-two and the tilted “O,” became one of the best-known images of the 20th century. The sculpture brought Indiana fame, but he left the New York art scene behind in 1978. He lived on the Maine island of Vinalhaven, an hour by ferry from the mainland, where the reclusive artist lived and worked, surrounded by a crew of studio assistants and workers.

Reference: New York Times (September 12, 2018) “Robert Indiana’s Estate: Generosity, Acrimony and Questions”

Awareness and Communication Can Help Head Off Elder Abuse

It’s great that overall our life expectancies have increased, but with longer lives, comes a greater risk of bad choices and financial elder abuse. There are steps you can take to protect those you love.

As we age, so does our brain. Even high functioning retirees, who have no outward signs of dementia, find it more challenging to distinguish between safe and risky investments, according to recent studies. The numbers say it all: only 7% of seniors over 60 have dementia, but nearly a third of those who are 85 years old or older have dementia.

MP900407501If you’re a senior or you have one in your life, it’s critical to know how to prevent abuse. The Kansas City Star provides some helpful ways to prevent abuse in its recent article, “Five ways to avoid elder financial abuse.”

Communication. Speak with your elderly loved ones on a regular basis to check in on their health and their activities. Remind them to maintain safe practices, like shredding receipts and account statements. You should also remind them to be cautious about opening unknown emails and that they should never give out their Social Security number or banking information online or on the phone. Keep open communication, so you can see if they’re showing any signs of confusion or mental decline.

Stay attentive. Know how your loved ones are spending time and their money. If they hire outside help, try to be involved in the hiring process and try to know their health care aides. In addition, take a look at their monthly or quarterly statements to identify any unusual, frequent, or large payments. If your loved one is showing signs of decline, ask if you can pay bills for them, so you’ll know what’s going on.

Create a system of checks and balances. Make sure that your senior has the proper estate planning documents in place that will let trusted family members help them as needed. If you have siblings or other family members, divide responsibilities and then swap responsibilities every few months.

Build professional relationships. Ask your senior to let you come to meetings with them, when visiting advisers, like their estate planning attorney.

Streamline accounts. Conduct an inventory of their financial documents. This includes their life insurance and long-term care policies, bank accounts and investment accounts. Try to make your loved one’s finances more manageable and consolidate their accounts where possible, which will make it easier to spot any unusual withdrawals or transactions.

If, despite all of your efforts, financial fraud or elder abuse takes place in your family, reach out to law enforcement in your area and talk with an elder law attorney. You can protect your loved one (or yourself) after the fact.

Reference:The Kansas City Star (September 8, 2018) “Five ways to avoid elder financial abuse”

The Empire State Takes Steps to Protect Seniors from Abuse

Governor Cuomo announced that services for vulnerable adults at risk of abuse, neglect or financial exploitation will be improved through a new initiative

Talk about going big–New York’s Governor Cuomo is expanding services for seniors at risk of elder abuse with an $8.4 million package, combining state and federal funding.

MP900422370Governor Cuomo announced that services for vulnerable adults at risk of abuse, neglect or financial exploitation will be improved through a new initiative developed by the state’s Office of Victim Services and the Office for the Aging, named the Elder Abuse Interventions and Enhanced Multidisciplinary Teams Initiative.

The program will fund and support 23 existing multidisciplinary teams that are now fighting elder abuse and will establish additional teams to serve every county in the state by the fall of 2020, according to the website,longisland.com’s article, “Governor Cuomo Announces $8.4 Million To Combat Elder Abuse And Financial Exploitation Statewide.”

"New York remains steadfast in its commitment to protecting one of our most vulnerable populations and to holding those responsible accountable for their actions," Governor Cuomo said. "By expanding upon existing efforts to ensure we are able to serve every county in the state, we can prevent harm to vulnerable adults, reduce risk of exploitation and save lives."

Over the next three years, the Office of Victim Services will provide $2 million in federal funding each year, and the Office for the Aging will provide another $500,000 in state funding annually to create the E-MDT Initiative. The teams are staffed by professionals from aging services, adult protective, health care, financial services, criminal justice, victim assistance, mental health, and other disciplines. They will coordinate investigations and develop interventions to thwart elder abuse. The teams assist adults age 60 or older, who are at risk for harm or exploitation due to physical limitations, cognitive impairment or dementia and social isolation.

The Office for the Aging is working with Lifespan and Weill Cornell Medicine's NYC Elder Abuse Center to manage, monitor and distribute the funding this year. The funding will maintain and expand current enhanced multidisciplinary teams and create more teams to ensure that every county in the state is represented. The funds will also help to provide technical assistance and training; collect data; and provide teams with forensic accounting, geriatric psychiatry services, and community legal services, when appropriate for the cases they’re handling.

The federal funding lets the state use additional funds to support 23 existing multidisciplinary teams.

Chair of the Assembly Standing Committee on Aging, Assembly Member Donna Lupardo said, "New York seniors deserve to age independently and with dignity. Unfortunately, this freedom is often threatened by criminals who target them for exploitation. By establishing and funding multidisciplinary teams in every county across New York, we will provide seniors with a powerful ally to help protect and support them. I would like to especially thank Governor Cuomo and all of my partners in state government for these important resources needed to reduce elder abuse."

Crime victims who were 60 or older filed more than 4,000 claims for assistance that were approved by the Office of Victim Services between 2015 and 2017. This is roughly 17% of the more than 23,000 claims awarded by the agency over that two-year period.

If the budget and the effort sounds oversized, it’s not. A state-funded study in 2011 found that for every single case of abuse reported to adult protective services or other authorities, there are 23.5 cases that are not reported. In addition, a 2016 study from the Office of Children and Family Services found that the financial exploitation costs vulnerable adults and the state at least $1.5 billion every year.

Reference: longisland.com (August 1, 2018) “Governor Cuomo Announces $8.4 Million To Combat Elder Abuse And Financial Exploitation Statewide”

New Tax Law Calls for An Estate Plan Review

When was the last time you reviewed your estate plan?

Don’t assume that the new tax law means that you don’t need an estate plan. If anything, you need to review your estate plan to make sure you’re not missing out on any new opportunities.

25543329453_9991c191f2_oWhen was the last time you reviewed your estate plan? If it’s been more than a few years, you could be risking making some big mistakes, in terms of taxes and what you leave behind for your loved ones.

The new tax law in effect doubles the federal estate-tax exemption to roughly $11.2 million per person. As a result, most people won’t be subject to federal estate tax. However, before you unfriend your estate planning attorney on social media, understand that the drastic increase in the federal exemption amount means that old wills and trusts may be in dire need of an update.

Kiplinger’s recent article, “Update Estate Plans in Light of New Tax Law,” notes that the 2017 tax reform gives new opportunities for estate planning techniques to reduce your taxes. You also still have the other benefits of estate planning to consider, such as creditor protection, strategies to protect against elder financial abuse, and maximizing bequests. However, remember that the new higher exemption amount sunsets at the start of 2026. That’s when the old $5 million exemption (adjusted for inflation) reappears.

For example, your estate plan may include a will and trust that applies formulas tied to the federal estate-tax exemption. With the new tax law, that could now have unintended consequences.

You should review your estate plan regularly, despite the legislative changes. That’s because life changes: your net worth changes, you or your children get married or divorced, grandchildren are born, and as a result, your old estate planning documents may not accurately reflect your wishes.

When you update your documents, remember your durable power of attorney. This type of gifting power may have made more sense when the federal estate tax exemption was much lower. However, with today’s higher exemption, broad gift provisions shouldn’t be included in some powers of attorney, because they leave seniors vulnerable to financial abuse.

The strategies that worked so well five or ten years ago when you last reviewed your estate plan, may be completely out of date. You may not need a complete overhaul of your estate plan, but if you haven’t reviewed your estate plan recently, including checking on all of your beneficiaries, you may be doing yourself and your loved ones more harm than good.

Reference: Kiplinger (April 28, 2018)“Update Estate Plans in Light of New Tax Law”

Indictment Unsealed in Federal Court Against Massive Mail Fraud Scheme

Federal officials announced the indictment of three people who used an old-school method—mail fraud—to scam at least $30 million from thousands of people

Thousands of consumers, many seniors, tricked into paying for promised prizes that never arrived.

MP900202201Federal officials announced the indictment of three people who used an old-school method—mail fraud—to scam at least $30 million from thousands of people across the country. The three, Tully Lovisa, Shaun Sullivan, and Lorraine Chalavoutis, were arrested and arraigned before a magistrate in Federal Court in Islip, New York.

Attorney General Jeff Sessions, Richard P. Donoghue, United States Attorney for the Eastern District of New York, and Peter R. Rendina, Inspector-in-Charge, United States Postal Inspection Service, New York Division (USPIS), announced the indictment, according to a US Department of Justicepress release titled “Three Long Island Residents Arrested In Elder Fraud Scheme”

“Earlier this year, when we announced the largest elder fraud sweep in history, we sent a clear message:  we will hold perpetrators of elder fraud schemes accountable wherever they are,” Sessions said. “When criminals steal the hard-earned life savings of older Americans, we will respond with all the tools at the Department’s disposal–criminal prosecutions to punish offenders, civil injunctions to shut the schemes down, and asset forfeiture to take back ill-gotten gains. Today’s indictment shows we are following through on this promise, and fraudsters everywhere should take note of it.”

The fake prize-promotion mailings said that recipients could receive a large cash prize, in exchange for paying a modest fee. However, none of them did. The scheme began after the Federal Trade Commission (FTC) sued Lovisa in 2010 for sending deceptive prize-promotion mailings.

In response to that suit, a federal court in California enjoined Lovisa in December 2010 and April 2012 from any involvement with prize-promotion mailings. Nonetheless, she conspired with Sullivan and Chalavoutis to create numerous prize-promotion companies using straw owners and aliases to continue defrauding consumers. Chalavoutis opened bank accounts in the name of straw owners and helped conceal the involvement of Lovisa and Sullivan in controlling the operation.

Prosecutors also claim that Lovisa submitted a false compliance report to the FTC, in which he claimed not to be involved in prize-promotion mailings. The additional wire fraud and money laundering charges involve Lovisa’s further deception of the FTC concerning the court-ordered sale of a house he owned in Nevada. According to the indictment, Lovisa arranged a sham sale of the house for $155,500 in 2012 that allowed him to maintain control of it and only give the FTC proceeds of that sale. Lovisa subsequently sold the house in April 2015 for $540,000.

Each charge carries a statutory maximum fine of $250,000, or twice the gross gain or gross loss for the offense. The defendants face up to 20 years’ maximum imprisonment for mail fraud, wire fraud and conspiracy.

Any prize that requires payment is not a prize. Seniors and anyone else should be wary, whether the prize is offered through the mail, an email or a website. Do your homework first—if an offer sounds too good to be true, chances are it’s a scam.

Reference: US Department of Justice (July 11, 2018) “Three Long Island Residents Arrested In Elder Fraud Scheme”

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