'Could a nefarious caregiver steal her money?' My mom, 91, has a $5 million portfolio, but leaves her passwords lying around the house.

By Quentin Fottrell

'Mom recently had a heart attack and isn't as sharp as before, and no longer can drive or live independently'

Dear Quentin,

Our 91-year-old mother has a portfolio worth about $5 million. One of my sisters has helped me balance our mom's checkbook for almost a year. Mom recently had a heart attack and isn't as sharp as before, and no longer can drive or live independently. She has caregivers for 18 hours a day.

Mom insists on logging into financial accounts online - the login info is printed out in her office - and also insists on having access to her statements. Her caregivers also have access to her financial information, should they choose to seek it out. We don't know all the caregivers well.

My sister is not concerned about having login and account information readily available to anyone. I am quite concerned. Am I overreacting? Should we be concerned? Could a nefarious caregiver steal funds from our mother?

The Other Daughter

Related: I fell victim to an online dating scam. I'm $27,000 in debt. 'Without commenting on my obvious stupidity, how do I recover from this?'

Dear Daughter,

I like your mother. She sounds like quite a dame!

I like that she insists on managing her own money, and I respect her for accruing and managing a $5 million portfolio. She comes across as a strong and determined lady, and that's probably what has gotten her this far in life. Your mom has every right to manage her own finances as long as she is able, and it will help to keep her active.

And, yes, your mother is taking a big risk with her security by leaving her passwords lying around. That goes for you, me, your sister and anyone else reading this article. Passwords, after all, were originally designed to distinguish friend from foe, and can be traced back to ancient times, when military personnel would announce, "Halt! Who goes there?"

Roughly 10% of all people over the age of 65 experience some form of abuse, according to studies cited by a paper published in the Cureus, a peer-reviewed online medical journal. "These rates are often higher in long-term-care facilities such as nursing homes, despite government regulations aimed toward addressing this issue," the authors wrote.

Healthcare professionals, they added, "are often undertrained and ill-equipped in diagnosing elder abuse." For that reason, it's important for friends and relatives to be vigilant with elderly loved ones, especially if their health is declining. That means reviewing documents regularly and keeping logins and passwords in a safe place.

How to protect against financial abuse

There are other things you can do to help: Setting up automatic payments will reduce both the risk of your mother falling behind on bills and the need for her to access her accounts frequently. You can also offer to help review her accounts once a week to make sure there are no unusual transactions. Credit cards and valuables should not be left lying around.

Your mother should also set up two-factor authentication for accessing her bank accounts. That way, if someone did access them without her permission, she would get an alert on her phone. Another simple rule: Make sure her computer password - which should not be easy for others to guess - is not stuck on a Post-it on her computer screen.

This should all be part of her estate planning: making sure documents - everything from life-insurance policies to your mother's last will and testament - are in a secure place where they can be easily accessed. You should also have an open and respectful discussion with your mom about setting up a durable power of attorney and healthcare proxy.

Everyone should be educated on financial fraud, which can take the form of scam artists randomly calling elderly people to tell them that their computer has a bug so they can gain access to it or asking the would-be victim to read security codes that have been texted to their phone. One way to avoid this modern-day scourge: Don't answer unknown numbers.

Assuming your mother has no reason to take out any loans, she can also freeze her account with all three major credit bureaus - Experian (EXPGY), TransUnion (TRU) and Equifax (EFX) - so no one can take out loans or open accounts in her name. This is also good practice for anyone whose accounts or Social Security number have been compromised.

Risk factors for elder exploitation

MetLife conducted a major study on the subject, finding that women were nearly twice as likely as men to be victims of elder financial abuse. Most victims were over the age of 80, lived alone and - this is the part that should interest you and your sister - required some level of help with either healthcare or home maintenance. But it can happen to anyone.

"In almost all of the cases, there existed a combination of tenuous, valued independence and observable vulnerability that merged in the lives of victims to optimize opportunities for abuse by every type of perpetrator - from the closest family members to professional criminals," the study concluded.

Elder financial abuse, the researchers theorized, appears to fall into the categories of "occasion, desperation and predation" - or, put another way, mere opportunity, financial need and strategic exploitation. If your mother has several caretakers coming and going through her home, it only takes one bad actor to create a problem.

As I told this person who fell victim to an online scam, it's not just caretakers: Perpetrators of financial elder abuse can be family members, lawyers, old friends, "new best friends," financial advisers and even the people running the nursing home. Anyone can fall for a scam, so your mother's situation is a teachable moment for us all.

More columns from Quentin Fottrell:

'I got seriously burned': My financial adviser took me for lunch, bought my kids gifts - and had me invest $500,000 in annuities. What should I do?

I lost $240,000 after a 'friend' I met on Instagram encouraged me to invest in crypto. Can I write off my loss?

'He's planning to bleed me dry': My husband turned into a monster after we married. I own a $1.3 million home. How do I save myself and my finances?

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-Quentin Fottrell

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06-16-24 2303ET

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