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FRAUD / PERSONAL FINANCIAL PLANNING

documents, medical documents, asset documents,
etc. as early as possible while the elderly person AICPA RESOURCES
still has full mental and physical faculties. Even
Articles
better is for individuals to obtain trusts and wills
in their younger years and to get into the practice “When Seniors Are Targeted in Schemes,” JofA, Nov. 1, 2021
of organizing important documents. Then as each
“Forensic Accountants Team Up to Fight Elder Abuse,” JofA, June 2020
person grows older, they should continue updating
these documents as personal situations change. “How to Guard Client Finances Against Dementia,” JofA, Jan. 2020
Attorneys, CPAs, and other financial advisers can
“How CPAs Can Help Prevent Elder Fraud,” JofA, May 7, 2018
be helpful in these matters, suggesting updates and

even safekeeping digital copies of the documents. A
Podcast episodes
trusted family member should know where physical
or digital documents are located. “Guiding Clients With Diminishing Mental Capacity,” AICPA.org
If possible, two people should handle transac-
“Tips to Help Your Clients Identify Fraud During COVID-19,” AICPA.org
tions for elderly individuals who cannot do it
adequately themselves. This reduces the temptation “Preventing and Responding to Elder Financial Exploitation,” AICPA.org
for one person to take funds without authorization.
“Guiding Your Clients Who Are Financial Caregivers,” AICPA.org
Authorization of transactions, access to financial

records, and transaction processing should ideally be
Publications
done by separate individuals. Separating these duties
reduces the risk of financial exploitation of elderly Guide to Retirement & Elder Planning: Healthcare Coverage Planning, issued
individuals. Regular reviews of transactions by an by the AICPA Personal Financial Planning (PFP) Section
independent third party — other than the assigned
Financial Decisions Guide — Elder Planning (exclusively for PFP Section
power of attorney or trustee — is also a wise detec-
members)
tive internal control.
When prevention fails, the elderly person or Webcast
family member should contact adult protective
“How to Advise Your Clients on Elder Care” (exclusively for PFP Section
services in their state or local law enforcement.
members)
Resources are available to help elderly people avoid
becoming a victim or to report abuse to authorities. Personal Financial Planning Certificate Programs
A 2017 federal law, the Elder Abuse Prevention
The Personal Financial Planning Certificate Programs are a series of
and Prosecution Act, P.L. 115-70, requires the U.S.
certificates covering the core areas of PFP, including retirement, estate,
Department of Justice (DOJ) to collect data on elder
risk management/insurance, and investment planning, as well as practical
abuse investigations as well as provide training and
application of knowledge. Tax planning and how it relates to each area is
support to states to fight elder abuse. The DOJ has a
incorporated throughout each certificate.
website that provides a way to report elderly financial
exploitation by family members or trusted individu- Personal Financial Planning (PFP) Section and PFS credential
als. The DOJ’s website links to the National Adult
The Personal Financial Specialist (PFS) credential highlights your tax
Protective Services Association (NAPSA), a not-for-
expertise and comprehensive knowledge of financial planning. All areas
profit organization that provides state and local adult
of personal financial planning — estate, retirement, investments, and
protective services contacts. Each state also has its
insurance — have tax implications, and only CPA/PFS professionals have
own elderly abuse center, agency, or hotline.
the experience, ethics, and expertise to get the job done right. Visit the PFP
It is likely that CPAs who provide financial
Section for more information.
planning, tax preparation, or accounting services
and reporting to elderly individuals will encounter
some type of financial exploitation. CPAs aware of
possible types of fraud can look for irregularities
in their clients’ accounts and also help their clients OTHER RESOURCE
establish safeguards to protect their finances. By Report
preventing abuse and exploitation, CPAs providing
The New York State Cost of Financial Exploitation Study, New York State
various services to elderly individuals can reduce the
Office of Children and Family Services (2016)
likelihood of their clients becoming another true
cautionary tale. ■
16 | Journal of Accountancy November 2022