Another study on financial competency and dementia

A study conducted by a team at the University of Alabama at Birmingham has shown that loss of financial competency occurs early in mild Alzheimer's and related dementias and that the decline is steep.

Here is an article about the study in Science Daily.

Here is another article from the UAB Health System.

The director of UAB Alzheimer's center had this to say:

“The impairment and eventual loss of financial competency are devastating and not uncommon consequences of Alzheimer’s disease and related dementias,” says UAB Alzheimer’s Disease Center Director Daniel J. Marson, JD, PhD, an attorney and clinical psychologist with specialty training in neuropsychology and geropsychology. “Financial exploitation of cognitively impaired elderly persons is already rampant, will continue to grow along with an aging population, and has enormous adverse consequences for patients and their families.”

New studies on brain deficits in the elderly

While researching efforts on fraud prevention against the elderly, I ran across two new studies, published just this year, indicating that some seemingly healthy seniors have significantly impaired decision making skills.

The first such study, by  Natalie Denburg of the University of Iowa addresses this question:

"We often read or hear stories about older adults being conned out of their life savings, but are older individuals really more susceptible to fraud than younger adults? And, if so, how exactly does aging affect judgment and decision-making abilities?"


A Denburg study

"published in the Annals of the New York Academy of Sciences, shows that 35 to 40 percent of a test group of 80 healthy older adults with no apparent neurological deficits have poor decision-making abilities.... The findings also suggest that these individuals may experience disproportionate aging of a brain region critical for decision-making."

The study went on to examine susceptibility to deceptive advertising amongst these same individuals and found significant vulnerability.

So now we're seeing scientific studies that back up what happened to Lola. Judgment can vanish long before other symptoms emerge. I'm sure the scammers have known this all along. But, by the time the family catches on, it can be too late.

When reason flees

Four and a half years have passed since that terrible day when the FBI called. I still wonder, almost every day, why I didn't figure it out sooner. What signs did I miss? Why was I so ignorant about the gathering dangers, poised to take down an elderly woman with a fair amount of money and impaired judgment? Could I have stopped her victimization before she lost so much?

Sure, I was worried about her. She was easily confused. The refrigerator always contained spoiled food and had sweepstakes notifications stuck to the outside. Huge stacks of unread magazines lined the family room and hallway, sometimes 3 or 4 copies of the same magazine, all ordered through channels with sweepstakes.

She had fired her financial adviser in early October of 2002 (likely under the urging of her Canadian lottery callers), liquidated all of her assets, and announced that she would handle her own investments henceforth. She explained that her mutual fund losses were responsible for the huge decline in the size of her portfolio. Horrified and suspicious, I talked her into finding another financial advisor. She did so, and I relaxed a little (a little too much apparently).

On the other hand, she lived alone, had some close friends, paid her bills (as far as I knew), shopped, cooked, and even served as treasurer for her ladies' club. Between us, my sister and I visited and spoke with Lola often. She was starting to have some memory problems, enough to make us uneasy, but not enough to trigger decisive action on our part.


Diagnosis: Early (mild) Alzheimer's and Vascular Dementia

Along with the emergency court order granting me guardianship in January 2004, the judge also ordered medical evaluation of Lola's mental condition since Lola refused to do this voluntarily.

Exams by a neuropsychologist and a psychiatrist found that Lola had both early Alzheimer's and vascular dementia. Even so, she did well enough on the mini mental exam to meet state criteria for "being of sound mind" for the purpose of making out a will. Everyone who knew her (immediate family excepted) was shocked at the diagnosis. Lola was masterly at hiding her deficits and activities from those around her (except for banking employees and con artists).

It was now clear to me that judgment and the ability to reason were the first skills to go, in Lola's sad decline. The stereotype of the dotty old lady who can't recall what she had for breakfast as emblematic of dementia does not hold up for many seniors. I now knew that a person could appear outwardly to be competent, yet have not a shred of rationality left.

Mighty big checks

Here's a partial list of some of the large checks that Lola wrote for various scams. I found them in check registers and verified them against statements from two banks and other records. This list is by no means exhaustive. Most checks ultimately went to Canada, some in the form of wire transfers; an exception is $15000 to the alleged Banco de Costa Rica. Note that some of the payee's names resemble those of well-known companies, possibly to gain the trust of the scam victim.

Date		Payee	Amount
4/3/2002		Sierra Promotions	$750.00
10/11/2002		Cashier's check	$1,987.95
10/11/2002		Cashier's check	$12,950.00
12/5/2002		Sierra Promotions	$600.00
12/9/2002		payee unknown	$2,000.00
1/3/2003		ADM	$600.00
1/31/2003		PMG	$475.00
2/10/2003		Sierra Promotions	$750.00
3/26/2003		PMG	$475.00
5/4/2003		Banco Costa Rica	$15,000.00
5/5/2003		N. International	$990.00
5/7/2003		Newport Group	$1,998.00
5/8/2003		Safe Investments Inc.	$19,900.00
5/29/2003		PMG	$1,425.00
6/19/2003		ADM	$599.00
7/3/2003		GCS	$20,000.00
7/14/2003		ADM	$790.00
7/16/2003		S.G. Inc	$399.00
7/16/2003		PMG	$700.00
7/25/2003		ADM	$698.00
7/29/2003		BCS - H. Diamond	$997.00
7/30/2003		ADM	$599.00
8/22/2003		Cash	$3,000.00
8/26/2003		Marathon Co.	$598.21
9/2/2003		Cash	$2,000.00
9/19/2003		Cash	$1,000.00
10/9/2003		Cash	$750.00
		GCS	$10,000.00
		PMG	$2,400.00
		ADM	$599.00
		Marathon Co.	$598.00

Do you see why I eventually stopped counting her losses?

How MBNA Abused Lola

After the guardianship hearing in January 2004, I confiscated Lola's credit cards. I questioned Lola about how much she owed, and she thought it was about $2000. I breathed a sigh of relief, thinking it could have been a lot worse. When I located the latest bills, which were on the kitchen counter, open but unpaid, I learned that it actually was a lot worse.

The American Express card wasn't too bad; she owed less than $1,000 on it. The MBNA bill was another story. She had two MBNA cards; one had a balance due of about $12,000 while the other account had a few hundred on it.

All her life, Lola had always paid off her credit cards each month. This level of credit card debt was unprecedented and deeply disturbing.

It seems that when Lola ran out of money to wire to Costa Rica and Canada, she wrote a check for $10,000 against her MBNA Visa card and deposited it in her bank. You know those credit card checks that come in the mail from time to time? Yep, one of those. MBNA very kindly and generously doubled her credit limit so she could do this.

I diligently paid about $50 more than the minimum payment each month, increasing the payment a little as soon as I sold the car.

Since I made reasonable and timely monthly payments, I was astounded when I opened an MBNA bill in midsummer 2004 and saw that the interest rate had jumped from around 15% to a ruinous and usurious 27%.

Outraged, I picked up the phone and started calling. For an hour or so I talked to everyone but the CEO, repeated my story over and over, and spent more time on hold than talking. Finally, the customer service representative revealed his findings: "We raised her rate because those regular payments indicated that she was treating the charges like a long term loan." Yes, he really did say that, in almost those exact words.

MBNA knew the situation of course. I had sent them the guardianship court order a week after I got it; the image was available on line to everyone I ever spoke with. I had even tried to disallow any future charges to the card. They said they couldn't do that; I would have to review each bill and dispute any charges that appeared, and there were many. I had spent hours on the phone with MBNA in early 2004, even filing a fraud complaint for $1000 worth of suspicious charges from psychics, publishers, and someone in Amsterdam.

My next step was to lobby the CSR for an interest rate reduction. This was even harder than getting an explanation. Another couple of hours and a manager or two later, I finagled a reduction to 18%, effective the next monthly bill.

Alas, it was almost a year after this MBNA debacle, that I closed on the house. During that time, I had to pay that outrageous 18% interest rate. I paid off this account the day I deposited the proceeds. I seldom use credit cards anymore.

You probably know that Bank of America bought MBNA. They deserve each other.

In Her Own Words

In early 2004, in an effort to keep my mother busy while I held her captive in my home, I had her write narratives from a disorganized mess of notes jotted down in haste during phone calls from scam artists. My intention was to pass this information on to the FBI in a more useful form than the notes on the little snippets of yellow paper everywhere. What follows is excerpted from a narrative inexplicably started in 2003 at the request of Claude, one of the scam artists. Lola said he was high up in the Canadian government and needed this information . She continued work on it at my house, and I gave a copy to the FBI.

Canadian Sweepstakes Group

This is an account of the beginning of a call from a Quebec Canada gentleman (Steve Mercer) of Dorval, Quebec, who I believe was a customs agent. He advised me that I had won a sweepstakes from some organization and his office, I believe it was Canadian Customs and they would be handling the paperwork and delivery when all the fees were taken care of and he would be back in touch, however, he did say winnings was a check for $125,000. A few days or weeks he called back and advised the winnings were two checks of $125,000 each and the fees had to be sent via Western Union to various people at several different locations. Below is the list of amounts, names, fee charges, etc. and dates. [All transmissions were to Dorval, Quebec, Canada and incurred $139 each in Western Union fees]

8/20/2003 $2,560 to Katherine Winslow,
8/21/2003 $2,990 to Steve Mercer,
8/22/2003 $2885 to Howard Sands,
8/28/2003 $2640 to James Gray
9/12/2003 $2430 to Gary White
9/15/2003 $2400 to Alfred Kennedy
10/9/2003 $2740 to George Grant
10/9/2003 $2760 to Arthur Wellington

Some of the customs agents out of Canada were quite difficult and rude to talk to. Here is a list if it would help you any. Robert Garcia was supposed to be Canadian. [I have several lists, but I'm not sure which one goes with this particular narrative.]

This doesn't sound like vast sums of money, but it's a drop in the bucket of Lola's total losses. I stopped counting at around $260,000 lost to fraud in the 18 months prior to the guardianship. It hurt too much to keep looking at those bank statements and checks. My lawyer said her case was the worst that he had heard of.

It is not a coincidence that one of the recipients of her wire transfers was "named" James Gray. That was my father's name. The name Gray turns up frequently in the lists of people who called her.

New York Times blog

A few days ago, an excellent blog known as The New Old Age by Jane Gross debuted in the New York Times.

I've been following the blog and reading the fascinating comments since its debut.

The intended audience seems to be caregivers and future caregivers of aging parents and grandparents.

So far, there have been no posts regarding elder scams, a subject near and dear to my heart, but the blog is only three days old.

Check it out. It's well worth your time.