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Gambling and Seniors Part 4 - Taking Action

Gambling and Seniors Part 4 - Taking Action for Self-Protection

by Don Drake, Connelly Law Offices, Ltd. 3.19.24

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Attorney RJ Connelly III

"Compulsive gambling can have a detrimental impact on not only the individual but also on their close relationships," stated professional fiduciary and certified elder law Attorney RJ Connelly III. "Thus, it is crucial to involve others in the recovery process. The first step towards recovery for a compulsive gambler is recognizing the problem and taking necessary measures to restrict the individual's access to money and valuables."

Gam-Anon has published an informative list of questions that family and friends of individuals with a gambling addiction can use to determine whether they are living with or friends with someone who has a compulsive gambling problem. This screening tool can be accessed by clicking on the photo below.

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Other "Red Flags"

“This is an excellent resource,” said Attorney Connelly. Other red flags may indicate a financial issue resulting from gambling or other forms of financial abuse. These indicators may include unexplained withdrawals, unusually high credit card balances, or sudden changes in financial behavior. Furthermore, other financial red flags may also signal a problem, whether it originates from gambling or other forms of financial abuse. These “red flags” include:

  1. Have you ever found yourself in a situation where you have overdue household bills and are struggling to make ends meet? Or perhaps someone in your family is pressuring you to lend them money, claiming that they need it to pay these bills, but you suspect they just want access to cash for other reasons? It can be a difficult and stressful situation to navigate, but there are steps you can take to protect yourself and your finances.

  2. Despite receiving a monthly retirement check, the individual consistently lacks funds for even the smallest purchases. This recurring financial strain persists despite efforts to budget and manage their expenses.

  3. You open a drawer and find hundreds of used scratch tickets. 

  4. The individual has received warning letters from credit card companies indicating that legal action will be taken if the outstanding bills are not settled promptly.

  5. The person in question seems to be experiencing extreme swings in their financial behavior. They exhibit a pattern of either spending large amounts of money impulsively during manic episodes or feeling deeply saddened and hopeless when they're unable to meet their financial obligations during depressive episodes.

  6. Bank accounts are shrouded in secrecy, and it's unclear who has access to them. Deposit slips are missing, and there's no record of where the money they represent has gone. There's a general sense of confusion and uncertainty about where funds are being kept or how they're being managed.

  7. You find that your loved ones are constantly asking for financial assistance. They may come up with various excuses ranging from medical bills to banking errors, which can create a sense of emotional and financial burden.

  8. Some personal valuables have gone missing. These include jewelry, works of art, collectibles, and tools. They may have been pawned off at a nearby pawn shop. It's important to take action and investigate this matter further to determine the whereabouts of your missing valuables.

  9. Someone you care about is engaging in potentially dangerous financial activities, such as investing in high-risk options such as the stock market, real estate, or precious metals, in pursuit of a large payout.

  10. The bank calls frequently about overdrawn accounts and bounced checks. 

  11. A loved one is frequently spending a considerable amount of time away from home. Based on your observations, they visit casinos or nearby convenience stores more often than usual.

  12. The property has been placed under a reverse mortgage even though the available sources of income do not necessitate such a course of action.

Attorney Connelly also points out that there are serious health issues that occur because of compulsive gambling. “We know that gambling destroys families and can result in spousal abuse and neglect. Statistics show that problem gamblers are prone to alcohol and drug abuse, depression, physical health issues, and even suicide.”

“Those who know a problem gambler have probably heard them say, ‘If I could

only get my finances in order, I’d never gamble again.’ But this is the ultimate form of denial. Their financial problems are the direct result of their gambling. Compulsive gambling is a serious psychological disorder that requires intervention on a variety of levels,” stated Attorney Connelly.

Beginning to Take Action

When there is a suspicion of embezzlement in a business, a forensic audit is conducted to investigate the accounts, missing funds, and any other means by which assets have been accessed. Similarly, in the case of an individual with a compulsive gambling habit, a thorough forensic audit of their personal financial affairs is necessary to determine the extent of their gambling activities and the impact they have had on their financial life. Such an audit can reveal critical information about the individual's economic situation, including any assets misused or misappropriated and any debts or other financial obligations that may have been incurred due to their gambling habits. These are the actions to take:

List all sources of income

Some apparent sources of income include salaries, social security benefits, pensions, trust income, and cash advances from credit cards. However, there are also some less obvious sources that people may not consider. For instance, one can receive income from tax refunds, an estate inheritance, and food stamps (SNAP).

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Know your sources of income

In the past, "food stamps" were coupons with specific dollar values that were easy to sell for cash. The government switched to electronic benefits (SNAP) to prevent fraud with a card that would theoretically be more difficult to steal from. Unfortunately, some business owners are still willing to pay for access to these cards.

In one example, we had a client who would use his SNAP card to buy cases of bottled water, empty the bottles, and then take them to a recycling machine to exchange them for cash. This is just one example of how creative some people can get when finding ways to make money.

Other sources of income include selling personal items on online auction sites like eBay, intentionally damaging a house or vehicle to get an insurance check that they cash themselves, and borrowing money from friends or family members.

We have even seen instances where seniors sell their prescription medications for cash. You may have seen people or organizations offering to buy diabetic supplies on TV or signs posted on telephone poles. Those with health insurance covering insulin and test strips can resell them for cash. This, unfortunately, often leads to untreated diabetes that can cause other health issues or even death.

Take an Inventory of Your Assets

Consider various types of assets while accounting for the financial resources of a compulsive gambler. To prevent the gambler from accessing these assets and using them for gambling, it is recommended to place them out of their reach.

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Make a list of all assets

Common assets that need to be considered are home equity, cash value in life insurance policies, real estate, retirement accounts, stocks, and certificates of deposit. These assets can be significant in value and can be used to fund the gambler's addiction.

Other assets, such as vehicles, jewelry, antiques, coin collections, computers, cameras, and artwork, may not be as obvious. These items can also have significant value and need to be secured to prevent gamblers from using them to finance their gambling activities.

It is important to note that even relatively new or high-tech appliances should also be considered assets. The value of these items may not be as high as that of other assets, but they can still be sold or pawned for cash to fuel the gambler's addiction. Therefore, it is essential to take a comprehensive approach to identifying and securing all assets to prevent the gambler from accessing them.

Develop A Budget

If you are living with someone who has a gambling addiction, it is crucial to keep track of every cent spent. This involves creating a budget that considers all household expenses and any outstanding debts that may have accumulated due to the gambler's losses. It is important to stick to the budget strictly so that there is no room for the gambler to spend money on gambling or other non-essential items.

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A budget must be strictly followed

In addition to creating a budget, it is necessary to develop a plan for paying off any debts that have been incurred as a result of the gambler's addiction. This may involve making regular payments on credit cards or loans, or seeking a financial advisor's help to devise a repayment plan.

If the budget is not being followed at any point, it is important to confront the gambler immediately. Even insignificant amounts of money that are unaccounted for can quickly add up and lead to much more significant losses down the road. By addressing these issues head-on and holding the gambler accountable for their actions, it may be possible to prevent further financial harm and begin the process of healing and recovery.

Take Away Control

When dealing with a loved one who has a gambling addiction, it is crucial to take away control of all finances from the gambler. This may involve entrusting someone else to manage the finances or taking control if you believe you can remain impartial. However, it is important to note that many gamblers are highly skilled at manipulating those closest to them, making it difficult for family members to maintain objectivity.

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Takin away control of money is a necessary step

For this reason, we highly recommend seeking the assistance of a professional fiduciary who offers daily money management services. These professionals are trained to take an objective and unemotional approach to managing finances, which can be especially helpful when dealing with a loved one who is struggling with addiction. While there is a fee for this service, it can ultimately save you a great deal of time, money, and emotional turmoil by taking the burden of financial management off of family members and placing it in the hands of a trusted professional.

By following this approach, you can avoid potential conflicts and battles when family members attempt to manage finances independently. This will allow you to focus on supporting your loved one through their addiction and helping them get the help and support they need to overcome it.

Gather a List of Liabilities

When creating a budget, identify and organize your liabilities in order of priority. Your top priorities should be making sure you can cover your rent or mortgage payments and utility bills. After that, you'll want to focus on paying off any credit card debt or other loans you may have. Additionally, you might want to consider contributing money back into your retirement accounts. Still, it's important to seek professional advice to ensure you're doing so safely and effectively. By taking these steps, you can help ensure that your finances are in order and that you're on track for a secure financial future.

Protect Your Own Financial Health

When dealing with compulsive gamblers, it is crucial to limit their access to any funds that do not exclusively belong to them, primarily if these funds are held in a joint account. Even if the gambler insists that they have changed their ways, it is important to safeguard your financial well-being and prevent further harm. By taking proactive measures to control the gambler's access to shared finances, you can help protect yourself from any losses or damage caused by their addiction.

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Protect your own financial health

If you suspect that someone close to you has a gambling problem, it's important to take steps to protect yourself financially. One of the first things you should do is check your credit cards and remove your name from any joint accounts. You should also check with the credit bureaus to see if any accounts have been unknowingly opened in your name.

In addition to this, you may want to consider changing your bank account from a joint account to your own. It's best to get a PO Box and have the statements delivered there rather than to your home so the gambler does not see your new accounts or have access to checks. It's important to remember that if you have been together for a long time, the gambler has access to your birthdate and social security number.

Another precaution is to get a safe deposit box and put your valuables in it. Again, have any information sent to the PO Box. Close out debit cards or change the pin, and do not allow the gambler to talk you into co-signing anything financial. It's also important to tell your friends and loved ones not to lend the gambler any money.

Finally, changing the household bills to your name is good if the utility allows it. By taking these steps, you can protect yourself from financial harm and ensure you are not held responsible for any debts incurred by the gambler.

A Final Word

"As you begin to take action, the compulsive gambler may struggle with the limits put into place and resort to manipulative tactics to obtain access to the resources of others," stated Attorney Connelly. "These tactics can take on various forms, such as showering others with excessive displays of affection, tears of regret, and making promises of reform. However, it is important to recognize that these behaviors are often driven by a desire to exploit others' financial resources and their sense of empathy. To effectively counteract this, it is highly recommended that individuals attend support groups. These groups can provide valuable assistance in maintaining personal well-being and understanding the diverse range of manipulative behaviors one may encounter as the process progresses."

In our next and final installment of this blog series, we will delve into the topics of treatment, recovery, and moving forward while taking an honest and objective look at the aftermath of a compulsive gambling problem. We aim to provide a thoughtful and informative discussion on this crucial issue.

In our series on gambling and seniors, our goal is to shed some light on this critical topic so we may help raise awareness and encourage those struggling with problem gambling to seek the support they need. Additional help can be found by going to the National Council on Problem Gambling where you can find help in whatever state you are in.

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Please note that the information provided in this blog is not intended to and should not be construed as legal, financial, or medical advice. The content, materials, and information presented in this blog are solely for general informational purposes and may not be the most up-to-date information available regarding legal, financial, or medical matters. This blog may also contain links to other third-party websites that are included for the convenience of the reader or user. Please note that Connelly Law Offices, Ltd. does not necessarily recommend or endorse the contents of such third-party sites. If you have any particular legal matters, financial concerns, or medical issues, we strongly advise you to consult your attorney, professional fiduciary advisor, or medical provider.

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