Elder Financial Exploitation: A Growing Crisis Banks Can’t Ignore

Elder financial exploitation isn’t just a fraud issue—it’s a public health and consumer protection crisis. With an aging population and increasing reliance on digital channels, older adults are being targeted more frequently, more aggressively, and often, more successfully by scammers and abusers.

From romance scams to trusted caregivers abusing authority, elder fraud takes many forms. What unites them is the damage they cause—not just in dollars lost, but in independence, trust and peace of mind.

Financial institutions are often the first—and sometimes only—line of defense. Recognizing the signs of EFE and responding decisively can protect vulnerable customers from losing their savings, homes or financial security.

The Scope of the Problem

According to a recent FinCEN analysis, financial institutions filed more than 155,000 Suspicious Activity Reports (SARs) involving suspected elder financial exploitation in a single 12-month period, flagging approximately $27 billion in suspicious activity. That likely represents only a fraction of the true scale, as many cases go unreported due to shame, fear or confusion.

Roughly 80% of reported cases involve scams by strangers—impostors posing as romantic interests, tech support, lottery officials or desperate family members in need. The remaining 20% stem from exploitation by someone the victim knows: adult children, caregivers or acquaintances who manipulate access to accounts, forge checks or pressure elders into harmful financial decisions.

The Human and Financial Cost

Elder victims often suffer more than just financial loss. Being scammed or manipulated can lead to lasting trauma, increased dependence on family or social services and loss of autonomy. Some never fully recover financially. Others lose trust in institutions, including banks, and may withdraw from managing their finances altogether.

The financial products most impacted by EFE include:

• Wire transfers, often initiated under false pretenses (e.g., romance or grandparent scams)
• Debit accounts, where scammers pressure victims to withdraw cash or buy gift cards
• Investments and savings accounts, especially when access is granted to a third party through a joint account or power of attorney

Because these transactions often appear authorized, spotting the signs requires contextual awareness—and sometimes, the courage to ask difficult questions.

Why Detection Is So Difficult

One of the most difficult aspects of elder fraud detection is distinguishing between poor financial decisions and exploitation. A customer may choose to make a risky investment or gift large sums to a relative, even if it appears suspicious. But when that decision is made under duress, manipulation or deception, intervention becomes necessary.

Other challenges include:

• Victim reluctance: Elders may be embarrassed or unaware they’ve been scammed, and might offer cover stories to explain unusual transactions.
• Caregiver control: In cases involving family members or caregivers, the elder may feel pressure to stay silent or may not fully understand their rights.
• Fraud scripts: Scammers often coach victims on what to say at the bank to avoid raising red flags—telling them, for instance, to say the money is for home repairs or a family emergency.

Recognizing behavioral clues is just as important as identifying transaction patterns. An older customer who suddenly defers to a companion, seems nervous or withdraws funds under vague pretenses may be under pressure from a scammer.

What Banks Can Do

Regulatory guidance has evolved significantly to support financial institutions in their role as protectors of vulnerable customers. FinCEN’s advisory on elder financial exploitation outlines both behavioral and transactional red flags, encouraging institutions to file SARs when exploitation is suspected, even when the elder appears to be acting voluntarily.

Importantly, privacy laws do not prevent banks from reporting suspected abuse. The Senior Safe Act of 2018 provides legal immunity for bank staff who report suspected EFE to law enforcement or adult protective services, as long as they do so in good faith.

Many states have also passed laws allowing, or requiring, financial institutions to temporarily freeze transactions when elder exploitation is suspected. Combined with real-time monitoring tools and frontline training, these measures give institutions the flexibility to pause, investigate and protect.

Proactive Protection with NICE Actimize

NICE Actimize helps financial institutions identify, investigate and escalate potential elder financial exploitation cases with speed and accuracy. Our fraud detection tools incorporate behavioral analytics, account activity monitoring and anomaly detection designed to surface the subtle signs of elder abuse—whether it’s a change in transaction behavior, a new device accessing an account or high-risk withdrawal patterns.

We also support case escalation workflows and compliance with SAR reporting obligations, empowering institutions to meet both their regulatory and ethical responsibilities.