By Thomas Goldsmith
People in later life have often built up assets that reflect a lifetime of work.
They may also be experiencing the build-up of dementia-related plaque deposits in the brain.
When both situations happen at once, personal catastrophe can result.
New research at Duke University shows that even early stages of Alzheimer’s disease can start to affect people’s ability to do basic financial chores such as making change from cash or balancing a checking account. And the more plaque a person has in the brain, the worse the financial skills.
Researcher Sierra Tolbert, until recently a Duke clinical research specialist and now a medical student in the U.S. Air Force, said results of a basic test can serve as a warning for patients and caregivers that the patient is losing the ability to make good decisions about money. With non-invasive procedures, clinicians can get a strong indication of whether dementia is present. Repeated testing can show whether it’s progressing.
“Would you rather have this very expensive PET test where you have to go in and get an injection, or a 15-minute memory test that deals with financial skills that can be completed in a physician’s visit?” Tolbert asked during a phone interview.
“With the cost of health care, I feel like physicians should definitely gravitate more to the simple easy one on how to write a check, or make change with $2 and 50 cent in coins,” she said. “These simple little things seem to show a lot.”
Meanwhile, government and private analyses show that older people, in general, weathered the downturn of the aughts better than younger generations, making them attractive targets for scam artists. Kenneth Carlson Sr., a successful business executive, did even better than the crowd, able to retire comfortably decades before dying in his 90s.
But a combination of advancing cognitive problems and unquestioned control of his own money led to Carlson’s being scammed repeatedly without the knowledge of his family, his son Ken Carlson, a Charlotte CPA, said in a phone interview.
Ken Carlson, 65, has started a sort of one-man campaign against the frozen-hearted exploitation of people who have worked hard to put away assets for their old age. In November, he spoke to a convention of the North Carolina Association of Certified Public Accountants to get the message out: it’s hard to catch scams in cases where neither facilitating banks or even the victims themselves are willing to blow the whistle.
Older people don’t make up the largest group of scam victims by raw number but tend to suffer larger losses, according to the Federal Trade Commission. Those older than 80 lost an average of $1,700, compared to a $400 shakedown of people 20 to 29.
Across North Carolina in 2018, 2,912 people reported telephone or bank fraud, according to data from the Federal Trade Commission.
According to a 2018 study by the Federal Reserve Bank of St. Louis, people older than 75 had the highest individual net worth in 2016 at about $58,000, while age groups 55 and younger were under water financially on average.
Following the recession that began in 2008, national median incomes for people older than 62 had increased 24 percent by 2016, while the same measure dropped 10 percent for people younger than 40 and 6 percent for those between 40 and 61.
“When these guys get caught in these scam type situation, they can’t extract themselves any longer on their own, because the embarrassment factor,” he said. “Their overall pride is such that they just can’t get out of it.”
The scamming of Carlson Sr. followed a pattern. Falsely informed in his 80s that he had won millions in a Spanish lottery, he followed instructions to send increasing amounts for taxes, fees, arrangements with officials and other made-up purposes. Carlson Jr. has a thick notebook of emails, letters and other ploys used by the scammers during a period when, his family believes, Kenneth Carlson Sr.’s cognitive abilities were failing.
The father’s loss came to exceed $380,000 and was only detected after he fell a few years before his death last year at age 98 and was unable to go to the bank for further transactions.
“It’s a tough nut, because what do you do about it?” Ken Carlson said. “It’s not against the law to spend your money. And the elderly person has to be willing to allow for some oversight and monitoring of their financial independence, for anybody to really be policing it.”
Because in-progress financial crimes are hard to detect, the sort of dementia testing used by the Duke researchers could help caregivers on the front end, Tolbert said. The tests of 243 people between 55 and 90, part of an ongoing multi-partner study called the Alzheimer’s Disease Neuroimaging Initiative or ADNI, compared plaque buildup to the ability to handle money.
“There has been a misperception that financial difficulty may occur only in the late stages of dementia, but this can happen early and the changes can be subtle,” P. Murali Doraiswamy, a Duke professor of psychiatry and geriatrics and the paper’s senior author, said in a press release. “The more we can understand adults’ financial decision-making capacity and how that may change with aging, the better we can inform society about those issues.”
Competence v. incompetence
Medicare requires doctors to give a brief cognitive assessment to people older than 65, but a report by the Alzheimer’s Association found that only one in seven people in that age group regularly get such testing. And the routine assessment wouldn’t necessarily catch financial issues.
“There’s a ton of neurocognitive testing out there,” Tolbert said. “But this one seems to be very good at catching people who you wouldn’t normally think have a memory problem because financial skills go across a wide variety of things. There’s a lot of complex thinking going into writing a check for multiple items and balancing a checkbook.”