The Elder Abuse and Dependent Adult Civ-il Protections Act (EADACPA) provides enhanced remedies for existing causes of action involving the abuse of elders or

dependent adults. Cal. Welf. & Inst. Code §§ 15600-15660. “Elder Abuse” includes finan-cial abuse and is found when a person wrong-fully “takes, secretes, appropriates, obtains, or retains real or personal property of an elder (65 or older) or dependent adult, or assists in doing so, for a wrongful purpose or with the intent to defraud.” Cal. Welf. & Inst. Code § 15610.30. Such appropriation is found when the person knew or should have known that his or her conduct was likely to be harmful to the victim. This includes undue influence, gifts, and donative transfers such as a change to a will or trust. The enhanced remedies available under the EADACPA are “in addi-tion to,” and not in lieu of, “all other remedies otherwise provided by law” and compensatory damages in financial abuse cases. Cal. Welf. & Inst. Code §§ 15657, 15657.5. The enhanced remedies supplement existing remedies for causes of action such as prohibited bequest to a disqualified person; breach of fiduciary duties; actual or constructive fraud; conver-sion, embezzlement, or forgery; and violations of statutory or regulatory duties.

Who Are the Perpetrators?Financial elder abuse is fast-becoming one

of the biggest crimes against our elderly pop-ulation. One of the reasons this lesser-known crime occurs so often unseen is because in most cases it is perpetrated by a member of the victim’s own family. Quite often, it is difficult to recognize financial elder abuse because we think of a perpetrator as a con-tractor charging for unnecessary items, a phone scammer claiming you won the lottery,

or a gardener who suddenly ends up the sole heir to your parents’ estate. To the contrary, much of the time, the perpetrator is a mem-ber of the victim’s own family. In many cases, the perpetrator is a child or grandchild who is unemployed, has substance abuse issues, lives with the victim rent-free, or otherwise counts on the victim for financial support. Often the victim will not report the abuse due to fear or embarrassment, which exacerbates the dif-ficulty of detecting and ending the abuse.

The COVID-19 pandemic presents even more opportunity for perpetrators to take advantage of those vulnerable to abuse, espe-cially if the perpetrator already resides with the victim. The elderly are especially vulner-able to infection from COVID-19 and are encouraged to stay inside and not to social-ize in-person with others. This means less contact with friends and family who either cannot come to visit in-person any longer or who are relegated to “visit” by telephone or

34 ORANGE COUNTY LAWYER

WHY FINANCIAL ELDER ABUSE IS A RISING CRIME AND

WHAT YOU CAN DO ABOUT ITby NOAH B. HERBOLD

35DECEMBER 2020www.ocbar.org

other remote means. This barrier to the vic-tim’s environment shields family and friends from seeing the condition of the victim or the household, making it easier for perpetrators to initiate and sustain the financial abuse for an extended period with less fear of appre-hension. For example, perpetrators will often monitor telephone calls, demand that con-tact be made only at scheduled times, make excuses as to why the victim is unable to come to the phone, or falsely say that the victim does not want to speak to family.

Perpetrators often claim to be the “care-giver” while asserting that the victim contin-ues to make all the decisions. However, upon further investigation, it may turn out that the perpetrator has control of the victims’ check-book, ATM card, credit card, and online access to bank accounts under the guise that they are simply assisting the victim with paying bills and running errands. The per-petrator may also have received “gifts” from the victim in the form of cash, vehicles, and sometimes houses and other expensive items.

In a recent case, a ninety-five-year old moth-er was the victim of “financial abuse” from her son. When his mother fell and injured herself, he convinced her to sell her home and move in with him (a house she also owned) under the guise that he would take care of her. Within a year, all the sale proceeds of his mother’s home had been spent by her son without her knowledge or consent. The other children became suspicious when their brother kept making excuses preventing visitation. He would say she was not feeling well, she was asleep, she didn’t want to talk to them, etc. Meanwhile, the perpetrator son, who could not hold a job, was taking trips to Las Vegas and staying in expensive hotels with his new girlfriend. Additionally, he had made several purchases for himself, including a new car. When the mother fell again and was admit-ted to the hospital by ambulance, the son pre-sented her with a deed transferring her house to him, her only remaining asset. Fortunately, upon pursuing a claim of financial elder abuse (among other demands) against the son, the children were able to recover their mother’s house and establish proper health care for her for the rest of her life. The son was evicted and forced to repay what he took.

Signs of Elder AbuseIdentifying signs of financial elder abuse is

quite straightforward. Typical behavior and actions include:• The victim no longer manages his or her

own finances.

• The victim exhibits periods of confusion, short-term memory loss, forgetfulness, or is easily influenced by others.

• Isolation from family and friends, such as monitored phone calls, and required scheduling of visits.

• Callers and visitors are consistently told that the victim is sleeping or cannot visit or talk.

• Relationships with the victim become estranged without explanation.

• The victim’s mood dramatically changes without explanation, such as depression or fear.

• Sudden changes to the victim’s estate plan to the exclusion of other close family members.

• Sudden changes in the appointment of financial decision-maker(s) for the victim.

• The perpetrator has a new car, takes trips, purchases luxury items, when he or she doesn’t otherwise have other income.

• The perpetrator receives gifts of money or property, especially when the gifts are not fairly balanced between the other children or the victim cannot afford to make such gifts.

The Perpetrator’s “Treasure Chest” to Defend Financial Elder Abuse

When a trust is the result of financial elder abuse, one impediment to a family member’s decision to pursue legal action against the per-petrator may be the expense. A trustee general-ly has a duty to defend against challenges to the trust’s validity, and the trustee’s attorney will be entitled to reasonable fees from the trust to prevent a failure of the trust. Estate of Duffill, 188 Cal. 536, 555 (1922); see also, Doolittle v. Exchange Bank, 241 Cal. 4th 529 (2015). How-ever, in the event the perpetrator/beneficiary is acting as trustee of the suspect trust, they may be precluded from using the assets of the trust to defend their wrongdoing. When the trustee is also a beneficiary, the dispute is over compet-ing trust instruments, and the trustee employs an attorney to defend the instrument that ben-efits the trustee, the trustee’s attorney may not be entitled to fees from the trust. Whittlesey v. Aiello, 104 Cal. 4th 1221 (2002) (attorney for trustee named in trust amendment that ben-efited trustee not entitled to fees from trust for unsuccessful defense of validity of amend-ment because it would be inequitable to force prevailing remainder beneficiary under initial trust, in effect to pay opponent’s fees on top of her own); Terry v. Conlan, 131 Cal. 4th 1445 (2005) (trustee not allowed to pay her attorney from trust to defend 2001 trust instrument benefiting her and her siblings against 1999 trust instrument benefiting their stepmother where trustee was not defending existence of

the trust, just trust instrument for her benefit over other instrument). Taking away the per-petrator’s ability to fund his or her own defense can be a powerful tool when pursuing finan-cial elder abuse.

What Can Be Recovered?A perpetrator is liable for reasonable attor-

ney fees and costs, in addition to other reme-dies, if the plaintiff proves by a preponderance of the evidence that the perpetrator engaged in “financial abuse.” Cal. Welf. & Inst. Code §§ 15610.30,15657.5(a). Additionally, if a court finds that the perpetrator has in bad faith wrongfully or by undue influence taken, concealed, or disposed of property belong-ing to the victim, the victim’s trust, or the victim’s estate the perpetrator shall be liable for twice the value of the property recovered. Cal. Prob. Code § 859.

What Can Your Clients Do?Your clients have several options to iden-

tify and protect a loved one from abuse. Ask questions of the victim and the perpetrator. And then ask more questions! Your client can contact Adult Protective Services to report suspected abuse. They can also contact local law enforcement to request a welfare check on the victim. To recover property and pun-ish the perpetrator, a person should contact an experienced trust and probate litigator. Even after a victim has passed away, family mem-bers may still pursue a claim of financial elder abuse against the perpetrator.

Noah B. Herbold is a Certified Specialist in Estate Planning, Trust & Probate Law (The State Bar of California Board of Legal Specialization) at Mortensen & Reinheimer, PC in Irvine. His primary focus is assisting clients with litigated matters such as: Trust Contests, Breach of Trust, Fiduciary Appointment and/or Removal, Asset Ownership, Beneficiary Rights, Determination of Heirship, Elder Financial Abuse, Property Disputes, and Conservatorships. Noah may be reached at noah@ocestateplanning.net.

This article first appeared in Orange County Lawyer, December 2020 (Vol. 62 No. 12), p. 34. The views expressed herein are those of the author. They do not necessarily represent the views of Orange County Lawyer magazine, the Orange County Bar Association, the Orange County Bar Association Charitable Fund, or their staffs, contributors, or advertisers. All legal and other issues must be independently researched.