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Now That the Holidays Are Upon Us, Did You Notice Any Red Flags?
What Financial Planners Should Know About Emerging Fraud Risks, the Fraud Diamond, and Protecting Aging Clients
As families reconnect over the holidays, financial planners often get a clearer window (sometimes directly, sometimes through client conversations) into what’s happening with aging parents, widowed clients, or vulnerable family members.
And while the season brings joy, it also reliably brings something more troubling: a spike in financial elder abuse, investment frauds, and relationship-based scams such as pig-butchering schemes.
For planners, this is the time of year when clients return from holiday gatherings with quiet concerns:
“Mom mentioned a new friend online.”
“Dad is suddenly talking about crypto returns.”
“My aunt is hiding her bank statements.”
These are moments when planners have both a duty and an opportunity to guide clients—and sometimes their families—in identifying risks before they turn into losses.
Understanding the Modern Fraud Landscape: Why Planners Need to Pay Attention
Today’s fraud schemes are not the simple email scams of the past. They combine relationship-building, emotional manipulation, social engineering, and increasingly sophisticated financial platforms.
One of the fastest-growing threats to older adults remains the pig butchering scam, a long-game strategy where a fraudster “grooms” the victim over weeks or months before introducing a fake investment opportunity. But planners are also seeing a rise in:
- • “Grandparent” emergency scams
- • AI voice-mimic payment requests
- • Romance/investment hybrid schemes
- • Fake charitable solicitations
- • Fraudulent real estate or loan transactions
- • Caregiver or family-member financial exploitation
To help planners understand why these scams work, the
Fraud Diamond framework, an expanded version of the classic Fraud Triangle, is especially useful.
The Fraud Diamond: A Tool for Financial Planners
The Fraud Diamond identifies four conditions that make fraud likely:
1. Pressure
The internal or external motivation.
For seniors, this may include loneliness, fear of running out of money, medical stress, or a desire to support family financially.
2. Opportunity
Any situation where the victim’s guard is down.
Technology gaps, social isolation, cognitive changes, and a trusting personality can all create vulnerability. Fraudsters specifically target these traits.
3. Rationalization
How victims justify decisions.
A senior may believe:
• “They’ve been so kind to me.”
• “This investment could help my grandchildren.”
• “I don’t want to bother my family with questions.”
4. Capability
The fraudster’s ability to carry out the scheme.
Modern scammers are highly capable: multilingual, patient, trained in psychology, and operating in teams with scripts, fake platforms, and convincing “customer service.”
Why this matters to planners:
Understanding the Fraud Diamond helps you identify which of the four elements is present in a client’s situation and which conversations could mitigate risk.
Holiday Debrief: Signs a Client or Their Parents May Be at Risk
Planners should ask clients:
“Now that you’ve spent time with your parents (or extended family), did anything seem off?”
Encourage them to look for:
• Sudden secrecy about finances
• New online-only friends or advisers
• References to unfamiliar investment apps or platforms
• Repeated stories about someone “helping” them with technology
• Declining cash reserves, unexplained withdrawals, or new credit activity
• Embarrassment or defensiveness about financial discussions
• A sharp shift in generosity—new charitable giving, gifting, or loans
These patterns often indicate one of the Fraud Diamond conditions is already present.
How Financial Planners Can Talk to Clients About Fraud Risks
These conversations can feel delicate, especially when they involve a client’s parents or older spouse. Approaching the topic with empathy and professionalism is key.
1. Start with the holiday connection
“Now that you’ve been with your family over the holidays, were there any moments where you noticed unusual financial behaviors?”
2. Normalize the concern
Explain that fraud is now an industry, not a random occurrence, and that intelligent, capable people are targeted every day.
3. Use the Fraud Diamond to frame vulnerability
Help clients understand why their parents might be susceptible without implying blame or diminished capacity.
4. Encourage low-stakes, judgment-free conversations within the family
Offer scripts clients can use:
• “I keep hearing about new scams, have you gotten anything strange lately?”
• “I’d love to help you review any investment offers you get.”
• “If something sounds too good to be true, call me or your adviser first.”
5. Review financial access and transparency tools
Depending on the client’s wishes and the parent’s capacity:
• Trusted contact forms
• View-only account access
• Account alerts for large withdrawals
• Annual “fraud checkup” meetings
• Reviewing estate documents for outdated fiduciaries
6. Reinforce the safety of asking questions
Many older adults hide fraud because they feel embarrassment or fear judgment. Planners can be a shame-free zone.
Specific Advice Planners Can Give Clients
You can provide actionable guidance such as:
- • Restrict oversharing online
Recommend clients help their parents lock down social media profiles, scammers mine church affiliations, grandchild names, and travel patterns.
- • Encourage a 24-hour pause rule
Any investment request, wire transfer, crypto purchase, or “urgent” payment should be delayed one day, this alone prevents a large percentage of fraud.
- • Create a simple “fraud plan”
Who to call, which accounts to freeze, what steps to take immediately after suspected fraud. Preparing in advance reduces emotional panic
- • Watch for caregivers or new companions with unusual financial access
Many elder financial abuse cases involve someone physically close, not remote scammers.
When Planners Should Intervene or Refer Out
Planners should escalate concerns when:
• A client’s parent shows sudden cognitive decline affecting financial decisions
• Large transfers occur without logical explanation
• A previously engaged client becomes evasive
• You suspect undue influence from a romantic partner, caregiver, or “friend”
• The client or parent refuses to share details but mentions “a great new investment”
This is when legal, elder care, or investigative support may be warranted.
How The Estate Lawyers, APC Can Assist You and Your Clients
Financial planners are often the first line of defense against elder financial abuse. Our firm collaborates with planners to help protect vulnerable clients, including:
• Financial elder abuse investigations
• Asset recovery actions for fraudulent transfers and investment scams
• Litigation involving undue influence, trust misuse, and family exploitation
• Protective strategies such as conservatorship guidance, fiduciary review, or trust restructuring
If a client reveals suspicious activity, or if you observe behavioral red flags during planning meetings, our team can help you assess the situation and take decisive steps before losses escalate.
Article provided by
Kimberly R. McGhee*
Partner
THE ESTATE LAWYERS, PC
Office:(858) 351-4006
kim@theestatelawyers.com
4350 Executive Dr. Suite 310, San Diego, CA 92121
TheEstateLawyers.com
