Consumer and industry advocacy organizations — including the American Land Title Association (ALTA), National Consumer Law Center (NCLC), National Association of Realtors (NAR) and AARP — are sounding the alarm over a rising trend of elder real estate fraud and financial exploitation in a new jointly created issue brief released on Friday.
The brief includes an overview of key actions that could be considered elder financial abuse, including but not limited to signature forging on legal or financial documents; coercing or “unduly influencing” the signing of such documents; failing to disclose “critical information;” “defrauding older adults out of money or property;” and “inappropriate utilization of authority under a power of attorney (POA).”
According to Federal Trade Commission (FTC) data cited in the brief, U.S. residents ages 60 and older lost more than $1.9 billion to these scams last year alone. Additional data from the FBI’s Internet Crime Complaint Center (IC3) 2023 report showed the cohort lost more than $65 million specifically tied to real estate scams, which impacted approximately 1,498 victims.
Based on the FBI data, this constitutes a 14% increase in elder financial exploitation from 2022 levels.
“Protecting property rights of all Americans is our top concern — and older adults are no exception,“ Elizabeth Blosser, vice president of government affairs at ALTA, said in a statement. “The stark increase in scams, fraud and financial exploitation targeting older adults is deeply concerning, and the private sector and policymakers must come together to combat these schemes, especially as the median age in this country continues to increase.”
NCLC senior attorney Andrea Bopp Stark added that the aging of the U.S. population necessitates additional action by policymakers at the state and federal levels to protect older adults from these kinds of scams.
“Lawmakers and advocates must take these abusive practices head on — strengthening consumer protections for the growing population of older adults and challenging emerging threats to their financial wellbeing,” she said.
Reverse mortgages are not explicitly mentioned in the brief itself, but they are mentioned by Bryan Greene, NAR’s vice president of policy advocacy, among a series of “exploitative tactics.”
“Addressing elder real estate fraud necessitates a collective effort,” Greene said. “NAR continues to advocate on behalf of seniors to shield them from exploitative tactics such as reverse mortgages, property investment and foreclosure-rescue offers. We are proud to work with ALTA, AARP and NCLC to offer these recommendations for states to prevent seniors from being targeted by these increasingly prevalent schemes and safeguard their financial security.”
While federal agencies have issued “fraud bulletins” related to reverse mortgages in the past, these primarily refer to bad actors who aim to manipulate an older victim into obtaining a loan. Reverse mortgages are legitimate products offered under the Federal Housing Administration (FHA)’s Home Equity Conversion Mortgage (HECM) program, but bad actors may seek to scam a senior out of money under the guise of offering a reverse mortgage on their home.
Jenn Jones, vice president of government affairs, financial security and livable communities at AARP, was more sensitive to such a distinction.
“While elder financial exploitation is often perpetrated by family members or trusted friends, older Americans are also common targets of unscrupulous professionals and strangers looking to commit fraud,” Jones said. “Financial exploitation of any kind wreaks havoc on the lives of older adults and their families, and we need stronger policies, enforcement and public education to combat this widespread crisis.”
