Financial Elder Abuse

Financial elder abuse is unfortunately a frequent form of abuse that does not receive as much attention as physical elder abuse. However, it can be devastating to its victims as it can go on for many years before being discovered and can leave an elder individual unable to care for themselves.

Amended in 2008, Welfare and Institutions Code section 15610.30(a) codifies what constitutes financial elder abuse. It provides that such abuse occurs where a person or entity does any of the following:

  • takes, secretes, appropriates, obtains or retains, any interest in real or personal property, for a wrongful use, or with intent to defraud or both; or
  • assists in doing any of the above described acts; or
  • does any of the above described acts through “undue influence” as defined in Civil Code § 1575. (Teselle v. Mc–Loughlin (2009) 173 Cal.App.4th 156, 174.)

A conclusive presumption of abuse arises where the person or entity “knew or should have known this [its] conduct [was] likely to be harmful to the elder or dependent adult.” Where such knowledge can be presumed, it “shall be deemed that the person or entity took, secreted, or appropriated” the property for a wrongful use. (Wel.&Inst.Code §15610.30(b).) This section relies upon a subjective and objective test to determine whether the wrongdoer had knowledge that the conduct would be harmful to elders or dependent adults. When determining whether the person or entity had subjective knowledge the courts look to the wrongdoer’s actual state of mind. However, the alternate objective test looks only to whether a reasonable person would have known that the conduct would or would be likely to harm the victim or his or her interest in property.

Subsection (c) of the code operates to clarify what constitutes a taking. This includes when any wrongdoer “takes, secretes, appropriates, obtains, or retains”  any property. A taking may therefore occur when title to real property is wrongfully vested or when a possessory interest in jewelry interfered with. In either case, so long as the elder individual is deprived of his or her property, a taking has occurred. This section also provides that a taking can occur by any means, including by agreement, a “donative transfer, or testamentary bequest, regardless of whether the property is held directly or by a representative of an elder or dependent adult.”

When financial elder abuse occurs, there are several means of recovery available to the victim. First, the victim may be awarded compensatory damages, as well as any other remedy available at law, and his or her attorney’s fees and costs. Other remedies available at law may include rescission or cancellation with regard to contracts, wills, and trust, as well a declaratory relief. Where a defendant has acted with recklessness, malice, fraud, or oppression, the victim may seek general damages for pain and suffering. Welfare and Institutions Code section 15657.6 provides that where a taking has occurred against an elder or dependent adult who lacks capacity, upon demand by the elder, the property must be returned to the victim or the defendant will subject to the foregoing remedies, including attorney’s fees and costs.

There are many situations in which elder financial abuse arises. Most frequent include family or caregiver theft and overreaching, where it is common to see theft of money or property as well as undue influence to receive testamentary dispositions. Professionals are also frequently guilty of wrongdoing. This commonly includes lawyers and accountants, bankers, insurance salespersons, and mortgage brokers. In these situations it is not uncommon to see overreaching that results in excessive fees and sales for services not necessitated.

If financial elder abuse is suspected, an attorney should be contacted immediately to assess the situation and determine how best to proceed.

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