Elder Justice Website

“Dear colleagues
The Department of Justice is developing and scheduled to launch, in early 2014, a new Elder Justice Website to serve as a resource to elder abuse prosecutors and others. One key component of the website is a repository of federal and state court pleadings in elder abuse, neglect and exploitation cases. We hope this repository will ameliorate at least one of the barriers to elder abuse prosecutions, namely the lack of training and guidance. we are currently looking for good examples of publicly filed documents (e.g., indictments or informations, motions, and sentencing memoranda) in every state. As we hope to launch the website in early 2014, we need to have all submissions by December 16, 2013. If emailing the documents is inconvenient, please feel free to email us cases with the docket numbers and county/state name so the pleadings can be retrieved from your local clerk of court at our expense/effort. Your submission can make a huge difference not just to other prosecutors, but also to elder abuse victims as well.” I do have contact information if anyone needs it. Have a good evening.

Elder Abuse - Fraud Awareness Campaign Urged by GAO

JULY 12, 2013 • TED KNUTSON

The nation needs an elder abuse awareness campaign, including information on how to prevent seniors from falling victim to financial fraud, according to a General Accountability Office study.

Financial fraud against the elderly can take longer to investigate than other types of senior abuse because financial records can be difficult to obtain and because it is often harder to prove than physical or emotional abuse, according to the GAO report released Wednesday.

In May, the federal Elder Justice Interagency Working Group recommended developing strategies for combating financial exploitation in collaboration with the financial industry. The recommendations included launching an elder justice Web site and a national awareness campaign.

GAO, the investigative arm of Congress, said a national campaign should be run jointly by the U.S. Health and Human Services and Justice departments.

Janna Dutton, Josh Mitzen, Richard Block, Sally Griffin and Devon Bank should be proud of themselves.  They're helping me make so much progress!

Banks Seen as Aid in Fraud Against Older Consumers

The pitch arrived, as so many do, with a friendly cold call.

Bruno Koch, 83, told the telemarketer on the line that, yes, of course he would like to update his health insurance card. Then Mr. Koch, of Newport News, Va., slipped up: he divulged his bank account information.

What happened next is all too familiar. Money was withdrawn from Mr. Koch’s account for something that he now says he never authorized. The new health insurance card never arrived.

What is less familiar — and what federal authorities say occurs with alarming frequency — is that a reputable bank played a crucial role in parting Mr. Koch from his money. The bank was the 140-year-old Zions Bank of Salt Lake City. Despite spotting suspicious activity, Zions served as a gateway between dubious Internet merchants and their marks — and made money for itself in the process, according to newly unsealed court documents reviewed by The New York Times.

The Times reviewed hundreds of filings in connection with civil lawsuits brought by federal authorities and a consumer law firm against Zions and another regional bank that has drawn even more scrutiny, First Bank of Delaware. Last November, First Delaware reached a $15 million settlement with the Justice Department after the bank was accused of allowing merchants to illegally debit accounts more than two million times and siphon more than $100 million.

The documents, as well as interviews with state and federal officials, paint a troubling picture. They outline how banks profit handsomely by collecting fees while ignoring warnings of potential fraud and, in some instances, enabling dubious merchants to prey on consumers.

Anyone, young or old, can be targeted by unscrupulous marketers. But for several reasons — financial worries, age, loneliness — older people are particularly vulnerable to what is known as mass market fraud, deceptive pitches that arrive by telephone, mail and the Internet.

The problems at Zions and First Delaware, where the banks became financial conduits and quiet enablers for questionable businesses, extend well beyond those two institutions, federal authorities say. Indeed, banks across the country, from some of the largest to smaller regional players, help facilitate billions of dollars of fraud each year, according to interviews with consumer lawyers and state and federal prosecutors.

Officials at the Justice Department say they are taking aim at banks’ role in giving predatory lenders and fraudulent merchants access to the United States financial system. The department is considering civil and criminal actions against a number of banks for allowing tainted money to flow through branches, for failing to safeguard against suspicious merchants, and for originating transactions on behalf of businesses that they know make unauthorized withdrawals from customer accounts, according to people with direct knowledge of the matter.

“You can’t close your eyes anymore to the fraud that you are allowing to happen,” said Michael Blume, the director of the consumer protection branch at the Justice Department. “Banks are in business to make a profit. Unfortunately, this is a moneymaking operation at consumers’ expense.”

Zions did not interact directly with the company that called Mr. Koch, National Health Net Online. What the bank did was establish a banking relationship with an intermediary, Modern Payments, that handled payments for National Health. Mr. Koch’s account at a small Virginia bank was debited by National Health, which in turn paid Modern Payments for processing the transaction. Modern Payments gave its bank, Zions, a cut of its fee.

In all, Zions in effect let roughly $39 million be withdrawn from hundreds of thousands of accounts from 2007 to 2009. Much of that money was ultimately transferred to bank accounts in Canada, India and the Caribbean, according to a Times review of court records. Many of the Internet merchants’ customers were older people and others on shaky financial footing. But that, too, worked in banks’ favor: the withdrawals set off a cascade of insufficient fund fees — more than $20 million in all, court records show.

“Zions takes seriously the need to prevent the banking system being used for fraudulent purposes; however, it is our general policy not to comment on pending legal matters,” said James R. Abbott, director of investor relations for Zions. “There is another side to this story, other than that told by the plaintiff. Our side of the story will be told at the appropriate time through the legal system.”

A spokesman for First Delaware declined to comment. Neither National Health Net Online nor Modern Payments responded to e-mails and telephone messages.

Mr. Koch, a retired teacher, said that he was usually skeptical of telemarketers. But when his phone rang one afternoon in November 2007, he recalled, he listened as the caller identified himself as a Medicare official and suggested that Mr. Koch update his health insurance card. Mr. Koch, as requested, supplied his bank information.

But instead of a new insurance card he received notice that he had been enrolled in National Health Net Online’s discount health plan. The company had withdrawn $299.95 from his bank account as payment, according to records reviewed by The Times.

National Health, a unit of NHS Systems Inc. of Collegeville, Pa., has a troubled history. In April, the Federal Trade Commission permanently banned the company from telemarketing and ordered it to pay a $6.9 million fine after accusing NHS Systems of defrauding consumers. NHS Systems did not return multiple telephone calls seeking comment.

“I was so angry,” Mr. Koch recalled. He demanded a refund from NHS Systems but was not reimbursed.

Between 2007 and 2009, tens of thousands of Americans, many of them over age 65, lodged complaints with state attorneys general, banking regulators and the F.T.C., requesting refunds for bank charges that they say were unauthorized, according to court records.

Lawyers at Langer, Grogan & Diver sued Zions, representing several hundred thousand consumers who said that NHS Systems and other telemarketers took money from their accounts without authorization. The lawsuit, which is pending in a federal court in Pennsylvania, claims that Zions effectively gave “fraudulent marketers direct access to every bank account in the United States.”

According to internal e-mails and other documents filed in connection with that suit, Zions bankers recognized something was amiss early on. An outsize number of customers were disputing payments to certain processors. The rates of return — that is, the percentage of payments that are returned for insufficient funds and lack of authorization — stood out. “WOW,” one Zions officer wrote in an e-mail after seeing the numbers.

Others inside Zions raised alarms, too. Zions executives told colleagues that the high return rates were a troubling sign. In January 2007, one warned that the rates were “staggering.” In 2007, more than half of the payments that one Internet merchant was routing through Zions were bounced back — roughly 40 times the industry standard.

Reviewing complaints about one Internet merchant, a Zions vice president wrote, “Every red flag possible went off in my head.”

And yet the bank kept handling the transactions, court records show. Why? One payment processor executive suggested an answer: the business was a gold mine.

“Turning them off and sending them somewhere else is not an option,” this executive told Zions in an e-mail in September 2007.

Officials at the F.T.C., the Justice Department, the Consumer Financial Protection Bureau and the Federal Deposit Insurance Corporation say this is just the tip of the iceberg, according to people with knowledge of the matter.

In a move that prosecutors say is a harbinger, the United States attorney in Philadelphia sued the First Bank of Delaware in November, claiming the bank effectively abetted “fraudulent Internet and telemarketer merchants,” court records show. The bank, the lawsuit claims, stayed “willfully blind” to the fact that the merchants were illegally taking money from customers, including a disproportionate number of seniors, through “fraud, trickery and deceit.”

Like Zions, First Delaware dealt with intermediaries rather than directly with the merchants.

But as Zane David Memeger, the United States attorney in Philadelphia, said in the lawsuit against First Delaware, bad actors “must access the banking system to gain access to the consumer’s money.”

At First Delaware, return rates for some merchants exceeded 80 percent. Yet the more questionable the merchant, the more fees a bank stands to collect, prosecutors say. Every time victims flag an unauthorized charge and demand money back, banks collect fees to process the return. Those fees are far larger, according to banking documents, than the ones charged for processing the original transactions.

First Bank of Delaware anticipated that revenue from its processing business would swell by more than 1,300 percent, from $150,000 in 2010 to roughly $2 million a year later, court records show.

Bradly D. Swartz, of Meshoppen, Pa., learned firsthand how much such practices can cost consumers. Mr. Swartz, 59, was trying to stretch his retirement savings when a telemarketer called in 2007 with what sounded like good news: Mr. Swartz had won a prize. All he had to do to collect was fill out a money order.

Then, starting in 2007, Mr. Swartz said, a subsidiary of NHS Systems — the same company that Mr. Koch had dealt with — started withdrawing $19.95 a month from his checking account. After emptying the account, National Health referred him to a debt collector, Mr. Swartz said.

Mr. Swartz said his credit was ruined. He now works part time at Walmart to supplement his savings.

“I have to work until the day I die, and these greedy banks just profit,” he said.

Federal officials say banks not only must know their customers, but also their customers’ customers in order to ensure that consumers in general, and older Americans in particular, are not at risk. The First Delaware case, they say, is a warning to the industry.

“Nothing sharpens the focus for banks like an enforcement action,” said Michael Bresnick, the director of President Obama’s Financial Fraud Enforcement unit.

Devon Bank Text Message Scam

This phone number is fraudulent . 228-831-5223

I don't think anyone infiltrated the bank since the Feds would force them to say something.  I think it's just a random person hoping you have an account here and asking for your personal information.

Don't give out your account information to anyone. 

If you fell for this scam, I'm so sorry.  I don't know why this bank doesn't step up and take better care of their customers?  You can call Devon Bank at this number 866-683-3866 toll free or contact them at bank@devonbank.com.  I would email the president of this organization or one of the other heads. RLoundy@devonbank.com or ILoundy@devonbank.com.  People have told me that their customer service isn't very good so, you may want to go straight to the top (although, I've been that route and wasn't very successful.)

I'm sure the bank will make a statement when they're finished cooperating with authorities, I hope.  Also, be very careful in regard to what you publish about this bank since they'll sue you for defamation even if you're publishing the truth. They're a bunch of bullies so this scam may be perpetuated by the owners just to make a couple of $$$ off you, I don't know.  I just know I'm being notified and I know another scam when I hear one.

March 2013 Legal Update

I got this in my inbox from a law firm:

DO-IT-YOURSELF WILL LEADS TO UNWANTED RESULT

 If you choose to write your own will, you run the risk of not having your estate distributed [http://ih.constantcontact.com/fs010/1102793168627/img/177.jpg] the way you want, as a
recent case illustrates.

George Z. wanted his estate to go to two of his five children. Instead of seeking out an elder law attorney to advise him on drawing up an estate plan, he decided to write his own will. The will gave his pickup truck to his daughter Diane and his summer property to his son Wayne. Mr. Z. also wrote in the will that he was intentionally leaving out his other three children. 

 The problem with the will was that Mr. Z. did not specify what to do with the remainder of his estate (called a "residuary clause"). While Mr. Z. probably intended that the rest of his estate would go to his favorite children, he didn't state that in the will. Because the will had no residuary clause, the remainder of Mr. Z.'s estate passed under the state law that specifies who inherits when there is no will. A court battle between the adult children began and was resolved, but only after the children had spent much more in attorney fees than their father would have paid to have his will done properly. While you may save some money drafting your own will, you are in danger of making mistakes that can cause unneeded conflict and don't get the result you want.

In regard to my Mr. Z, his attorney didn't forget to designate his automobile - it was the rest of his assets that she liquidated.  She hired herself to force him into guardianship, hired her friends to be guardians then made further money suing me for defamation after I published the crime she committed.  I can't prove how much she made off this Mr. Z but I can prove how much it will cost you to hire this law firm to handle your affairs (based on actual clients) and how much Mr. Z's heirs will inherit after this law firm is done financially exploiting him.

The questions are these:

Do you have 30-60K to hire an attorney to set up your affairs?  

Do you have 100K-1M to hire their friends as your guardian?  

Do you want your attorney to inherit your estate or your family?  George Z may have only wanted 2 of his 5 children to inherit but at least there was money left to inherit and it went to the rightful heirs, not an interloper.

Every time I read about this attorney, she's always putting herself in the middle of the elderly and their loved ones.  It's not surprising that she would write about a family fight.

Fed Issues Order Against Devon Bancorp in Illinois

by Brian Browdie

MAR 19, 2013 1:57pm ET

The Federal Reserve Board has taken action against a Midwest banking company.

The Fed said Tuesday that it has reached a written agreement with Devon Bancorp in Chicago. The company agreed to refrain from paying dividends, distributing capital or redeeming stock without regulatory approval. It will also provide written details about its sources and uses of cash.

The parent of the $240 million-asset Devon Bank also agreed to serve as a source of strength for the bank and to provide the Fed with quarterly progress reports.

Separately, the Fed terminated a written agreement with Bank VI in Salina, Kan., that obligated the bank to provide a written plan for maintaining sufficient capital and strengthening board oversight of its operations.

The July 2010 agreement also required the $65 million-asset bank to strengthen its credit risk management practices, to reduce concentrations of credit, to improve management of its funds and to hire an outsider to review its loan portfolio.

Bank VI also agreed to refrain from lending to any borrower that had loans flagged by examiners during a January 2010 examination. The bank was also required to improve its position in connection with past-due loans in excess of $250,000 and to eliminate losses that it had not already charged off.

The Fed took both actions on March 13 and announced them on Tuesday.

Link to Federal Reserve Action.

Suze Orman Will & Trust Kit

This is a much SAFER alternative to going to an attorney to set up your financial affairs.  If you do go to an attorney, make sure they're NOT probate lawyers.  Trust Attorneys and Estate planning are good - Probate or Elder Law should be avoided.  Attorneys are expensive and there are some who prey off the elderly and disabled and if you're a regular reader, I'm sure you know whom I'm talking about.

This is an easy-to-use and fast way for you and other members of your household to create your own advance directive, also known as a living will, durable power of attorney for health care, living revocable trust, and all the other must-have documents you need to protect you and your family. It’s as easy as 1-2-3—simply personalize, print, and protect.

Suze Orman and her own estate trust attorney have created the most state-of-the-art documents found anywhere. There are more than $2,500 worth of estate documents in this kit. Why pay thousands of dollars when you can get the same documents in this kit!

This kit includes:

• More than 50 state-of-the-art documents • Free automatic on-line updates • Verbal and written instructions taking you step by step through the four must-have documents • Password protection securing multiple users’ information • A tutorial that shows you everything you need to know • 10 electronic books

PC and Macintosh Compatible . . . and good in all 50 states!

You don't need an attorney with this kit.  You do need a Notary Public to witness signatures (most banks or currency exchanges have one).  It's also a good idea to have many copies of the legal documents and if anyone has an idea of what to do with the original?  I wouldn't put it in a safety deposit box at a bank.  In regard to Devon Bank taking over your assets, they just drill it open and take the contents.  Your family is then at the mercy of the trustees regardless of what the document states.  First thing banks do is liquidate assets or family jewelry, heirlooms, stocks, cars, land, property, etc., then invest that money in small state banks (friends of theirs) that yield little or no interest.  It's not uncommon for the bank to try to make money off you and the sentimental value you placed means nothing to them.

It's a good idea to keep everything "within the family" and that includes hiring caregivers (no agencies).  Don't invite strangers into your loving family unit.