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Combatting the high cost of elder financial abuse

It makes me see red when I think about how devastating financial abuse of the elderly can be.

American seniors are losing $36.5 billion every year to fraud, exploitation and financial abuse, according to a report just released by True Link Financial. A San Francisco-based financial services firm, True Link helps seniors and their families protect themselves.

Here's why seniors are red meat for crooks:

"Older Americans are attractive targets because many have retirement savings and home equity," said Richard Cordray, director of the federal Consumer Financial Protection Bureau. "They are also more likely to experience cognitive decline, which can impair their capacity to recognize fraud."

But it's not just seniors with cognitive decline who become victims.

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"More unexpectedly, we found a significant relationship between how friendly a person was over the course of his or her life and the amount of money lost," True Link's report said. "We call it 'friendly grandma syndrome.'

"You tell Mom to hang up on telemarketers, but she is just too polite to hang up on anyone, and before you know it, she's ready to bake them cookies."

In fact, someone described as "extremely friendly" over the course of his or her life is likely to experience four times the financial losses of someone with a more typical level of friendliness, the study found.

"One explanation for why friendliness leads to this kind of financial loss is that it increases exposure to more actors with abusive intentions," the report said. "This theory is consistent with research that shows that age-related changes in cognition may increase vulnerability to fraud in a range of ways.

"Compared with younger adults, older adults don't perceive cues of untrustworthiness as clearly, are more likely to be persuaded by information in advertisements, and experience subtle declines in judgment."

And if they're targeted by telemarketers, their risk of being scammed rises, the study found.

"A person who receives one phone call or more per day from a telemarketer is likely to experience three times as much financial loss as someone who receives no or only occasional telemarketing calls," the report said.

One effect of financial exploitation of seniors really breaks my heart:

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"Financial abuse frequently results in reduced emotional and physical health for seniors," the report said. "We estimate that 954,000 seniors are currently skipping meals as a result of financial abuse."

Even without being scammed, some seniors are already having to decide whether to pay for their medication or get food.

That's not a choice anyone should have to make.

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