LEGAL REMEDIES TO PROTECT SENIORS FROM UNDUE INFLUENCE AND FINANCIAL EXPLOITATION Presented by: Kathryn C. Casey Dutton & Casey, P.C.
DEFINITIONS RISK FACTORS CHARACTERISTICS OF PERPETRATORS PSYCHOLOGICAL METHODS
Definition of Undue Influence In the Elder Abuse Context: Undue influence occurs when one person (an abuser) uses his role and power to exploit the trust, dependency, and fear of another. The abuser uses his or her power and influence to deceptively gain control over the decision making of the other person effectively replacing the will and decisions of the victim with the will of the abuser. Undue influence is a characteristic of a relationship where the abuser gains financial benefits by influencing the victim.
Definition of Undue Influence In the Legal Context: A transaction or gift benefitting a person acting in a fiduciary relationship with the donor/party to the transaction is presumed to be the result of undue influence and is therefore presumptively fraudulent. The presumption of undue influence can be overcome only by clear and convincing evidence. Requires: a fiduciary relationship AND a gift or transaction OR fraud or coercion
Definition of Financial Exploitation In a civil context: Breach of Fiduciary Duty - A transaction or gift benefitting a person acting in a fiduciary relationship with the donor/ party to the transaction is presumed to be a breach of fiduciary duty and the burden shifts to the fiduciary to prove that the transaction was fair and reasonable, that he exercised prudent and reasonable care and judgment, and that he exercised undivided loyalty. Requires: a fiduciary relationship AND a breach of duty AND damages
Definition of Financial Exploitation In a criminal context: A person commits the offense of financial exploitation of an elderly person or a person with a disability when he or she stands in a position of trust or confidence with the elderly person or a person with a disability and he or she knowingly and by deception or intimidation obtains control over the property of an elderly person or a person with a disability or illegally uses the assets or resources of an elderly person or a person with a disability.
Definition of Financial Exploitation In a criminal context continued: The illegal use of the assets or resources of an elderly person or a person with a disability includes, but is not limited to, the misappropriation of those assets or resources by undue influence, breach of a fiduciary relationship, fraud, deception, extortion, or use of the assets or resources contrary to law.
Identifying Clients at Risk Advanced age (over 75) Female Unmarried/widowed/divorced Organic brain damage Cognitive impairment Physical, mental or emotional dysfunction Recent loss of spouse or divorce Living with abuser Dependence on abuser Living alone Social isolation Estranged from children Financially independent with no designated financial caretakers Middle or upper income bracket Taking multiple meds Frailty Fear of change of living situation (e.g. transfer from home to institution) Implied promise by perpetrator to care for elderly person if funds or material goods are transferred
Characteristics of Perpetrators Sociopathic or antisocial character disorder Caregiver role Living with victim Being economically dependent on victim History of mental illness or substance abuse Often related to victim Male
Characteristics of Perpetrators Note: Not infrequently there are business persons who exploit the impaired elderly by selling inappropriate products such as annuities with long periods of withdrawal penalties, stocks, bonds, home improvements.
Characteristics of Perpetrators Types of Fiduciary Relationships: In Law (agent to principal or doctor to patient); or In Fact some factors to consider: the degree of kinship of the parties; the disparity in age, health, and mental condition; the disparity in education and business experience between the parties; the extent to which the allegedly subservient party entrusted the handling of her business affairs to the other; and the extent to which the subservient party reposed faith and confidence in the alleged fiduciary.
Psychological Methods Margaret Singer Model of Undue Influence Creating isolation Fostering a seige mentality Inducing dependence Promoting a sense of powerlessness Manipulating existing fears or instilling new ones to create or enhance vulnerability Keeping the victim unaware and uninformed of the creation of this pseudoworld
Psychological Methods Bennett Blum Model Dependence on Perpetrator - this may be physical or emotional dependence Isolation Emotional manipulation of the victim Gaining control of the victim s money or property
LEGAL REMEDIES TO PROTECT SENIORS
Elder Abuse and Neglect Act Access Orders Freeze Orders
Access Orders
Who is Entitled to Access? Any public or nonprofit agency appointed by the Area Agency on Aging (with prior DOA approval) to receive and assess reports of alleged or suspected abuse, neglect, self-neglect or financial exploitation under the Elder Abuse and Neglect Act.
Access to Whom? Eligible adults (person 60 years of age or older who resides in a domestic living situation) Reported or found to be victims of abuse, neglect, self-neglect, or financial exploitation.
Access for What Purpose? Conducting a face-to-face assessment with the alleged victim of abuse; Assessing other needs of the alleged victim; Providing services to the victim of such alleged abuse, neglect, and/or financial exploitation in accordance with the Illinois Elder Abuse and Neglect Act
When is an Access Order Necessary? a caregiver or third party has interfered with the assessment or service plan, OR the agency has reason to believe that the eligible adult is denying access because of coercion, extortion, or justifiable fear of future abuse, neglect, or financial exploitation.
Freeze Orders
Who may Petition for Freeze Order? Office of the Attorney General Department on Aging Provider Agency
Freeze Order Requires: Substantiated financial exploitation Documented reasonable belief that the victim will be irreparably harmed
Freeze Order The Order shall: prohibit the sale, gifting, transfer, or wasting of the assets owned by or vested in the victim without the express permission of the court.
Illinois Power of Attorney Act Order for Accounting Court Intervention in POAS
Duty of Agent to Account Agent shall provide record of all receipts, disbursements and significant actions when asked by: Principal, guardian or another fiduciary Provider agency Office of State Long Term Care Ombudsman Office of Inspector General A court
Duty of Agent to Account POA Act was amended on July 1, 2011 and no longer requires a physician s report signed within 90 days finding the victim lacks decision making capacity before an accounting can be requested from the agent.
Failure to Account If the agent fails to provide his or her record of all receipts, disbursements, and significant actions within 21 days after a request under paragraph (b), the court may be petitioned for an order requiring the agent to produce his or her record.
Failure to Account If the court finds that the agent's failure to provide his or her record in a timely manner was without good cause, the court may assess reasonable costs and attorney's fees against the agent, and order such other relief as is appropriate.
Order Revoking Agency Upon petition by any interested person: Finding that principal lacks control to direct or revoke agency; and Agent is not acting for benefit of principal; or Action or inaction caused or threatens to cause substantial harm to principal The court may revoke the agency
Domestic Violence Act Order of Protection
Order of Protection A petition for an order of protection may be filed only: (i) (ii) by a person who has been abused by a family or household member or by any person on behalf of a minor child or an adult who has been abused by a family or household member and who, because of age, health, disability, or inaccessibility, cannot file the petition, or (ii) by any person on behalf of a high-risk adult with disabilities who has been abused, neglected, or exploited by a family or household member.
Probate Act Guardianships Citations to Recover Assets
Standards of Capacity In Illinois, a presumption exists that persons of a mature age are sane and have the mental capacity to contract. As long as the party in question can understand the nature of the transaction and protect his or her interests, the court will find him or her mentally competent and validate the transaction Capacity to contract is the mental ability to appreciate the nature of one's actions Powers of Attorney are contracts
Standard of Incapacity for Guardianship A court will appoint a guardian when: 1. A person is disabled due to mental deterioration, physical incapacity or development disability; and, 2. That person is totally incapable of making and/or communicating decisions regarding his personal or financial affairs due to his disability; and, 3. Guardianship is necessary to promote the well-being of the disabled person and/or to protect him from neglect, exploitation, or abuse
Guardianship Procedures 1. Filing Petition for Appointment of Guardian 2. Service of Summons 3. Appointment of Guardian ad Litem 4. Obtaining necessary Physician s Report (In Cook County, CCP 211) 5. Notice to spouse, children, siblings and agents under power of attorney
Remedies in Guardianship Temporary Guardian of the Estate All orders under the EANA, POAA, and DVA Plenary Guardian of the Estate Citation Actions to recover misappropriated funds Incapacity Undue Influence, Coercion or Duress Breach of Fiduciary Duty Fraud Conversion
Equitable Remedies Undue Influence Breach of Fiduciary Duty Imposition of Constructive Trusts Damages
Punitive Damages The Illinois Supreme Court held that punitive damages are allowable where the wrong involves some violation of a duty arising from the relationship of trust and confidence. The Appellate Court held that punitive damages are appropriate to punish and deter conduct where the defendant is guilty of an intentional breach of fiduciary duty.
Treble Damages A person who is charged by information or indictment with the offense of financial exploitation of an elderly person or person with a disability and who fails or refuses to return the victim's property within 60 days following a written demand from the victim or the victim's legal representative shall be liable to the victim or to the estate of the victim in damages of treble the amount of the value of the property obtained, plus reasonable attorney fees and court costs. The burden of proof that the defendant unlawfully obtained the victim's property shall be by a preponderance of the evidence. This subsection shall be operative whether or not the defendant has been convicted of the offense.
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Locations : Attorneys: 100 W Monroe Street, Suite 810 Janna Dutton Chicago, IL 60603 Kathryn C. Casey Phone: 312-899-0950 Melissa Howitt Lara A. Duda 9933 N. Lawler Rd., Suite 440 Skokie, IL 60077 Phone: 847-261-4708 1665 N. Arlington Hts Road Client Care Coordinator: Suite 306 West Erin C. Vogt, LCSW, ACSW, CCM Arlington Heights, IL 60004 Phone: 847-906-3584 www.duttonelderlaw.com