Protecting Older Adults from Cyber Fraud During Estate Transitions

Estate planning is often thought of as a way to protect your family in the future. You create a will or trust, name people you trust to make decisions on your behalf, and organize your financial affairs so your wishes can be carried out.

But there is another risk worth considering: what happens when someone tries to take advantage of you during a period of transition?

The loss of a spouse, a move into assisted living, a change in health, or the transfer of financial responsibilities to an adult child can create opportunities for bad actors. Cybercriminals know that periods of uncertainty can make people more vulnerable to scams, especially when large financial accounts or estate assets are involved.

Protecting yourself from fraud is not just a cybersecurity issue. It can also be an important part of protecting the estate you have worked a lifetime to build.

What Is Elder Abuse and How Can It Affect Your Estate Plan?

Financial Exploitation is considered elder abuse, and it falls into two categories: financial abuse by someone they know and financial fraud committed by a stranger.

The second category is increasingly happening online.

A scammer might impersonate a government agency, financial institution, technology company, or even a family member. They may claim there is a problem with your account, tell you that your money is at risk, or create a sense of urgency that pressures you to act before you have time to think.

The consequences can extend beyond an immediate financial loss. If money is stolen from a retirement account or bank account, it may affect the assets available to support the individual during their lifetime. It can also reduce the assets ultimately intended for children, grandchildren, or charitable organizations.

During an estate transition, these risks can become even more complicated. Someone who has recently lost a spouse, for example, may suddenly be managing financial accounts they previously shared. An adult child acting under a power of attorney may also become a target for phishing emails or fraudulent requests that appear to involve the family’s finances.

In short, protecting an estate also means protecting the people responsible for managing it.

How to Identify a Scam

Scams can be sophisticated. The goal is often to make you feel that you need to act immediately.

A few common warnings include:

• Urgency or threats. A call or email says you must act now or face serious consequences.
• Unexpected contact. You receive an unsolicited call, text, or email about a supposed problem with your finances or personal information.
• Request for unusual payments. Someone asks you to send a wire, purchase gift cards, transfer cryptocurrency, or withdraw cash to “protect” your money.
• Impersonation. The person claims to represent the Internal Revenue Service (IRS), Social Security Administration, your bank, a technology company, or another trusted organization.
• Secrecy. You are told not to discuss the situation with your family, advisor, or anyone else.

One simple rule can help: When someone creates urgency around your money, slow down.

The Department of Justice specifically warns that the government will not threaten you or tell you to transfer money to “protect” it. If something feels unusual, hang up and independently contact the organization using a phone number from its official website or a statement you already have.

Preventative Steps You Can Take Today

Good cybersecurity does not require you to become a technology expert. A few simple habits can significantly reduce risk.

• Pause before responding. Never feel pressured to make an immediate financial decision because of an unexpected call, email, or text.
• Verify independently. Do not use the phone number or link provided in a suspicious message. Find the organization’s official contact information yourself.
• Use strong, unique passwords. Consider using a reputable password manager so you do not need to reuse passwords across multiple accounts.
• Turn on multi-factor authentication. Multi-factor authentication adds another layer of security by requiring more than just a password to access an account.
• Create a trusted circle. Identify the people you would contact before making a large or unusual financial transaction. This might include a spouse, adult child, attorney, or financial advisor.
• Review your estate plan regularly. Make sure your powers of attorney, trustees, and other fiduciaries are people you trust and are prepared for the responsibility.

It is also important to talk openly about fraud. Many victims feel embarrassed after being targeted, which can prevent them from asking for help. But scams are designed to manipulate intelligent, thoughtful people. Falling for a scam is not a sign of weakness.

What Can Your Advisor Do for You?

Your financial advisor cannot prevent every scam, but having a trusted professional in your corner can provide an important additional layer of protection.

Your advisor can serve as a second set of eyes when something does not feel right. Before making a large or unusual financial decision, you can pause and ask for another perspective. Your advisor can also help you think through how your financial accounts, estate plan, and trusted decision-makers work together.

If you have questions about protecting yourself or a loved one from financial fraud or want to discuss how cybersecurity considerations fit into your broader estate and financial plan, speak with your advisor. A simple conversation today may help protect the assets and legacy you have worked so hard to build tomorrow.

Sources:

[1] U.S. Department of Justice, Elder Justice Initiative — “About Elder Abuse.”
The Department of Justice defines elder abuse broadly and identifies financial exploitation as one of its major forms.
Department of Justice: About Elder Abuse

[2] U.S. Department of Justice, Elder Justice Initiative — “Financial Exploitation.”
Provides definitions and examples of financial abuse and fraud, along with common scam warning signs and reporting resources.
Department of Justice: Financial Exploitation Resources

[3] Federal Trade Commission — Protecting Older Adults from Impersonation Scams.
The FTC has reported a significant increase in high-dollar impersonation scam losses among older adults.
Federal Trade Commission: Older Adult Impersonation Scams

[4] Federal Bureau of Investigation — Elder Fraud Resources.
The FBI provides information about common elder fraud schemes and resources for reporting suspected fraud.
FBI Internet Crime Complaint Center: Elder Fraud

Apella Capital, LLC (“Apella”), DBA Apella Wealth, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered or excluded or exempt from registration requirements. Registration of an investment advisor does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. Apella Wealth provides this communication as a matter of general information. Any data or statistics quoted are from sources believed to be reliable but cannot be guaranteed or warranted.

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