Psychological Cost of Financial Exploitation
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[00:00:00] Regina Koepp: I got an email a couple weeks ago from a listener. Asking for resources for helping older adults following financial exploitation or abuse. And so today I wanna devote this episode to supporting older survivors of financial exploitation to avoid retraumatization and to promote healing.

And I had been meaning to do this episode for a while. In the fall, was invited by the Vermont Financial Elder Abuse specialty team to do a workshop on talking with older survivors of financial exploitation.

And so I wanna talk about the psychological toll of financial exploitation on older adults. Some unique considerations for older adults and resources to support the older adults you might be working with who are survivors of financial exploitation. I wanna start by sharing a story. A story of financial exploitation of an older adult and a middle aged adult. And what I'd like you to do is to be thinking about in yourself, what sort of.

Responses or reactions, knee jerk reactions you have to the stories. So the first story is imagine an 84-year-old friend she ha has no dementia, super independent exercises every day. Manages all of her affairs. She gets an email from her bank saying that she is under suspicion for some fraudulent activity and that she needs to get money to correct this suspicious financial activity. And there's a whole series of hoops that she has to jump through to get money out of her checking account and pay in the way that she's instructed to pay. And this takes a full day of jumping through hoops, getting money out of her account, putting money somewhere else, and in the end.

She was exploited out of $25,000.

Now I wanna share another story of another friend who in is a 46-year-old woman who invested in Bitcoin and receives a notification on her phone that she has to move some of the Bitcoin money from one place to another. And they're using all the information from her Bitcoin app and she has to call and verify that it's her and she does this.

And in the process of calling and verifying that it's her, this is how the scammers get to her phone. They have walked her through this process. This is how they get to her phone, get access to her phone, and, they tell her essentially, put $5,000 over here into this app for your Bitcoin and we'll take care of the rest.

And it all appeared very legitimate because there was like two factor authentication. The person was very professional on the phone, and it was very smooth and clear and this is the system for how things go. And that friend, the 46-year-old, was scammed out of $5,000. And so some of the reactions that come up for me or came up for me when I heard these two separate stories were, oh, I wonder if does the older person now have a, an issue with judgment where I didn't assume an issue with judgment with the middle aged person.

Is the older person able to manage their finances? I didn't have the same question for a middle aged person. And so there are some common reactions and important considerations as it relates to older adults and financial exploitation. And the other tricky thing actually is that so there was a recent study, I'm gonna try to find it that, that looks at financial vulnerability.

As an early warning sign of a dementia disorder. And so it gets very tricky, like how do we honor the person's autonomy and ability while also being mindful that that sometimes not always, and probably not most of the time, but sometimes an experience of financial exploitation in older adulthood could be an early warning sign.

But I'd like you to think about what were some of your reactions, like to think about, okay, for this older woman, what are some of the reactions that you have about her experience of being scammed out of $25,000? Then what about the middle-aged woman? What are some of your reactions to the middle-aged woman being scammed out of $5,000, do you think?

Oh, how could they fall for that? Like at what point of that didn't they start to question? And so today we're gonna talk about what happens for financial exploitation survivors. And I'll tell you, these scammers are so sophisticated. They make it seem very legitimate, and so this impressive display of sophistication has led to in 2023, older Americans losing or being exploited out of $1.6 billion in 2023 alone.

And you might be surprised to hear that the fraud losses between the ages of 60 to 69. Topped, those of all age groups, totaling $836 million in 2022. So it's not the oldest old that have lost the most money. It's the people between 60 to 69. And so there are lots of common financial scams like imposter scams.

So this is where maybe somebody is calling as your gas company, the IRS, your bank tech support. A family member, a romantic interest. A romantic interest is a common one. Now, online marketplace scams, like through Facebook marketplace. I was selling something on Facebook marketplace and several people tried to scam me.

Fake checks. This is where a scammer gives you a fraudulent check to deposit and then asks you to send the money back to them. And while there's a significant financial cost, that $1.6 billion of people 65 and older there is. Also significant psychological cost of financial abuse. And so Give An Hour, is a nonprofit organization that had funding to provide education on the psychological cost of financial abuse. And so they put together, this graph, which I think is so helpful, and it shows in the first three months following a fraudulent event, a person's likely to experience sadness, isolation, shame, embarrassment, fear, guilt, isolation, and three to six months more loneliness, anxiety, fear, exhaustion, depression, six to nine months after the fraudulent event.

Isolation, depression, anger, guilt, and nine to 12 months. Lack of trust, rage, terror. Exhaustion. Desperation. So the psychological cost is immense. For many fraud survivors, they experience shock and disbelief, anger, shame, fear, anxiety, betrayal. Distrust, and it's really important this a conversation about stigma and shame is really important here.

And I think this is true for every age group, and especially true for older adults because stigma related to mental health care disproportionately impacts older adults. So stigma surrounds the experience of being scammed. And is a product of victim blaming and a lack of understanding about how scams and frauds happen in the first place.

Stigma is like the scarlet letter. Stigma is like where the person who's just experienced this event is then ridiculed for having experienced the event. It's like victim blaming, how could you fall for that? And so stigma. Leads to shame. So it's not only that they experience the negative reaction from people around them, but also this sort of alienation or rejection or belittlement that they're not good enough or they did something wrong themselves.

And stigma leads to shame. So shame is associated with a belief that. The self will be perceived negatively by others that could lead to rejection or aggression by others like judgment, negative judgment and stigma and shame hold people back from asking for help and healing, sometimes resulting in worse mental health outcomes than if we just provided them support.

When it comes to older adults there can be diminished self-confidence, and then family members might begin to question your judgment or the judgment of an older person. Or wonder, can you manage your finances? Do you have the capacity to manage your finances? There can be relationship ruptures and stress related to having less time in life to recover the losses.

So say you've lost $25,000, or you, or even more than that, and that was a significant chunk of your nest egg for retirement, and now you have less time in life to recover the losses.

So I wanna talk about four mental health. Challenges reported by individuals who've experienced victimization or fraud or exploitation. One is anxiety, two is depression. Three is anger, and four is stress. These are the most prevalent mental health challenges reported by individuals who've experienced victimization, financial victimization.

Remember, anxiety and depression are not normal with aging. So these are unique and need to be addressed.

So I wanna share four ways that you can help older adults who have been exploited financially. The first is to communicate openly and positively. So approach conversations with empathy. Actively listen without placing blame. Ensure your interactions are respectful and reassuring. It's also critical that you examine, and part of this communication requires you to examine your own beliefs about fraud and survivors of scams.

So common beliefs about scam survivors are, I don't get how they would fall for that, or they must be vulnerable in some way, or gullible or naive. We have a lot of bias and knee jerk reactions to people who have just been scammed, and especially older adults. So these beliefs harm the person even more and interfere with providing the best possible support.

So it's really important that you, before you start working with somebody who, or even if you're noticing these beliefs or knee jerk reactions are coming up for you to examine your own beliefs and biases and check 'em. Don't let them through. So another is to be aware of the fundamental attribution error.

So this is a common human bias that we all have. This is our tendency to attribute another person's behavior to a personality flaw or defect, while we attribute our own behavior to a situational factor beyond our control. So while we might say, I can't believe they fell for that, they're gullible, or maybe they have dementia or they have poor judgment, we need to take over.

If we were the one to fall for the scam, we would likely say, oh, they were so sophisticated. Every step they walked me through was right on target, was so what I would expect for a two factor authentication. And so beware of the fundamental attribution error. Beware of the tendency to attribute another person's behavior like falling for a scam to a personality flaw or defect.

And remember, these scams are so sophisticated. We would likely all fall for them if we got into the web. Another is to put blame where blame is due. So blame the perpetrator, not the survivor. Scammers are super sophisticated and skilled, and they use psychological tactics to manipulate people.

They also have many people in financial resources that allow them to build these intricate networks of checks and balances, which is where my middle age friend was. Like. The system was so sophisticated and clear with multiple factor auth authentication, like it made so much sense that I would be going through this.

And then it's really important that you're mindful of what you say and of your tone. So avoid saying things like, how could you fall for that? You didn't know that was a scam, or you didn't know that scam, that IRS scam is the oldest in the book, or, I would never fall for that, or I would never have been that naive.

Or you just need to forgive yourself and move on. So avoid. Saying those things and instead use more of a trauma-informed approach. And so if you wanna learn more about trauma-informed care I have a, I have an episode on that a few weeks ago, so go check that out. So instead of asking, how did you fall for that?

Instead ask what happened, help me understand. I'm so sorry that happened to you. Help me understand. You can also help. In addition to all these communication techniques and strategies you can also help by promoting emotional wellbeing. So encourage comprehensive mental health support to help manage the stress and emotional impact of the fraud.

Remember, all those emotional responses may benefit from support, extra support, and help identify activities that promote physical wellness and reduce stress.

If you're in a situation where you're not a therapist, but you might refer somebody to therapy, here's one way to do it. Thank you for trusting me with this important experience. It's clear this has had a profound impact on you. Sometimes it can help to talk with someone who's trained to help people cope with the distress that comes with being exploited and heal -somebody like a therapist.

Is that something you're open to? Can I help you find somebody to talk to? And then you can use our provider directory to find a therapist, and I'll put a link to that in the show notes. Another thing you can do is encourage a supportive community so you can help survivors connect with peer groups to share their experiences in a non-judgmental space. I'll put a link in the show notes to some peer groups for financial exploitation and promote involvement in safe local events or support networks to strengthen social connections and rebuild trust in others. Sometimes because we've been betrayed. In a relationship, we are less likely to engage in relationships, and so it can be alienating and result in social isolation, and we don't want that

so it's really important to build a supportive community, Give An Hour, who I mentioned earlier, is a nonprofit organization that collaborated with finra on resources for financial fraud survivors I'm gonna put a link to their webpage for peer support groups. They have support groups for people who have been financially exploited and then also for loved ones of people who have been financially exploited.

And then you can help prevent revictimization by helping the person access reputable financial management tools to learn about public awareness campaigns that are have to do with scams to receive tech training, to avoid online scams and develop a scam safety plan and establish trusted emergency context.

And so I'm gonna put a link in the show notes also to Dr. Peter Lichtenberg. Older adult nest egg.com. This is out of Wayne State. It's highly credible. Dr. Lichtenberg was the president of the Gerontological Society of America last year, I believe, and he was also on this podcast talking about financial exploitation.

So I'll put a link to that episode in the show notes as well, but also to his website where people can do their own self-assessment of financial vulnerability, where family members can learn more about helping a loved one to stay financially secure and so on. So that's at older adult nest egg.com and I'm gonna put a link to those resources here and then there are important steps to take if you have been scammed.

One is to report the scam to the Federal Trade Commission, and I'm gonna put all this in the show notes as well. Two is to report scams to your local FBI office or submit a tip to the FBI online. And three is to report the scam to the FBI's internet crime complaint. Center and so I'm gonna put all of this in the show notes as well, so you don't have to remember this, but there will be links to things that you can do or steps to take if you have been scammed.

Also, because this can be very destabilizing for people, it's really important that you have a good handle on providing trauma-informed care to older adults.

And so I have a free guide. It's a free trauma-informed care guide for you. You can get that at mentalhealthandaging.com/tic, like for trauma informed care and so I encourage you to download that guide and get a, an understanding of providing trauma informed care to the older adults that you're working with so that you do not revictimize them or retraumatize them after they've just gone through this financial trauma and betrayal.

Alright, that's all for today. I hope that you will get to the show notes and get these resources and share them with older clients that you're working with or their family members, because really connection is key when healing from trauma. There's a saying that healing from trauma happens in community, and so it's really important to connect survivors of financial exploitation with other survivors or with a mental health provider, and then also maybe their family might need coaching for providing care and support without stigma, shame or blame.

All right. That's all for today. Bye for now.