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How Forensic Accountants Can Expedite Solving Financial Exploitation Cases

By Karen (Webber) Skuse, on June 29th, 2023

Financial exploitation is the fastest growing form of adult abuse, and among the most prevalent globally. With over 1.4 billion seniors at risk by 2030, the World Health Organization and United Nations have made scalable technology to address this issue a strategic priority for the next decade. As first responders here in the US, Adult Protective Services (APS) and law enforcement are receiving thousands of new requests for financial exploitation investigations each month, but don’t have the personnel or the training for asset tracing or detailed transaction analysis.

To solve this issue, national and local agencies are attempting various methods of intervention utilizing forensic accountants for training and investigation support. However, funds to pay professionals are limited, and in some regions, such expertise is not available. Emerging technology creates the opportunity for agencies to increase capacity using their existing workforces and increase confidence of the workers charged with investigating difficult cases.

APS agencies are faced with a two-fold problem when it comes to financial exploitation cases: rising volume and a workforce ill-equipped to take them on. Karen Webber, Partner in Bonadio’s Advisory and Consulting group, has spent her career assisting APS and law enforcement agencies across the US with their investigations through traditional consulting services and more recently the launch of financial investigation software, This article will provide a top line view of the forensic accounting services and solutions approaches that APS agencies across the US employ to streamline financial exploitation investigations and empower workers.

Overview of Financial Exploitation

The theft or misuse of assets for the benefit of another individual is known as financial exploitation. Every day examples may include a relative using an older adult’s debit card, a caregiver convincing an older adult to turn over real property, or a trusted professional churning the investment account of an older adult to collect excessive fees. This type of abuse leaves older adults both financially and emotionally devastated. Victims of financial exploitation may be forced to rely on government funding to fill basic needs like food and housing, and they suffer increased rates of depression, suicide, and even early death.

Responding Agencies

Whenever abuse, including financial exploitation, is occurring or suspected, it should be reported to the police. Concerned individuals may also make a report to Adult Protective Services (APS) in their county. APS has the obligation to investigate reports of abuse and determine any necessary supporting services required to keep older adults living safely in the community. Often, APS and law enforcement work in partnership. Some states have formalized the working relationship between APS and law enforcement by forming elder abuse-focused multidisciplinary teams (MDTs), sometimes called FAST teams, forensic centers, or enhanced/E-MDTs. These teams bring together other community partners such as aging services and domestic violence agencies, financial institution representatives, geriatricians and psychiatrists, forensic accountants, and others who may have a role in intervention in a case of financial exploitation.

Role of Forensic Accountants

Forensic accountants play a critical role in financial exploitation cases by assisting responding agencies with the financial analysis piece of an investigation. Forensic accountants gather information about the victim, collect financial records, and compare transaction activity in the records to the activity that likely should have taken place based on the victim’s lifestyle. Patterns and anomalies indicative of possible financial exploitation are shared with APS, law enforcement, attorneys, or family members to assist with intervention. If intervention involves legal proceedings such as guardianship/conservatorship or criminal prosecution, forensic accountants may be called to testify on their findings in court. Bonadio’s Fraud and Forensic team has partnered with E-MDTs in nearly all counties in New York State to secure millions of dollars in court-ordered or agreed-upon restitution in financial exploitation cases.

Challenges for Agencies

Not all agencies have the resources to hire forensic accountants for financial exploitation cases, which means that the burden of a financial investigation rests with case workers and officers who often have little to no training on investment vehicles, tracing assets, or real property law. Without these skills, case workers and officers may be unable to perform an adequate investigation or ignore the financial side of a case by focusing on some co-occurring abuse instead. Increasing caseloads and a lack of tools or skills to perform financial exploitation investigations can mean that victims go without justice, and workers grow increasingly frustrated. In a labor market stretched thin, technology is the only solution.

Leveraging Technology

Our FraudFindr® financial exploitation software was developed based on years of experience providing forensic accounting services for financial exploitation cases. This proprietary software allows investigators to upload the financial records received for their case, view all transactions in one place, and receive instant analysis that identifies patterns and anomalies that may indicate financial exploitation.

Bonadio’s Fraud & Forensic team offers a mix of traditional services and software solutions to government agencies, attorneys, and individuals responsible for investigating financial exploitation of older and vulnerable adults. Please do not hesitate to reach out to our trusted experts.

This material has been prepared for general, informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Should you require any such advice, please contact us directly. The information contained herein does not create, and your review or use of the information does not constitute, an accountant-client relationship.

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