Lawmakers Asked To Tighten Laws on Financial Abuse of Elderly

BY JIM DOOLEY – State law requires that cases of suspected physical abuse of the elderly must be reported to law enforcement, but there is no such requirement in cases of suspected financial abuse, legislators were told today.

Banks or other financial institutions must report those suspicions to the state office of Adult Protective Services, which is not a law enforcement agency and is not equipped to conduct a criminal investigation, said Patricia McManaman, director of the state Department of Human Services.

Christopher Van Marter, head of the Honolulu Prosecutor’s White Collar Crimes unit, and Honolulu Police Lt. John McCarthy, who oversees HPD’s financial crimes investigations, recommended a change to the law.

The testimony came during an informational hearing on elder abuse and financial exploitation before the state Senate and House Human Services Committees.

McManaman, whose department includes the Adult Protective Services office, said the original version of the law on elderly financial exploitation required financial institutions to report their suspicions to both APS and law enforcement.

But before the final version of the law was enacted, it was changed to remove law enforcement notification, said McManaman.

As search of the legislative history of the measure did not disclose the reasons for the deletion, she said, adding that she suspected lobbyists for the financial industry may have sought the change.

Banks and lending institutions, she said, don’t like “seeing their names on the police blotter.”

Van Marter and McCarthy said time is frequently short in such investigations because criminals can quickly gain control of a victim’s money and transfer it out of the reach of authorities.

Van Marter said his office recently froze an account containing $500,000 that a suspect intended on transferring to another account. He said the case is still under investigation by his office and HPD.

Because victims may suffer from medical and mental conditions, said the prosecutor, the sooner the cases can be investigated, the better the chances of a successful outcome.

McCarthy said investigations can also be helped or impeded by “good and bad” financial institutions.

Bad ones, he said, delay the production of subpoenaed records to the full 21 days allowed under state law.

McManaman pointed out that Adult Protective Services has no authority to subpoena records when financial abuse is suspected.

Various witnesses told the legislators that the graying of Hawaii’s population has seen an increase in financial crimes against the elderly.

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