CFG Elder Financial Exploitation & Consumer Protection Flashcards
6 cards from real CFG practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 CFG Elder Financial Exploitation & Consumer Protection flashcards as text
Which of the following best describes 'undue influence' in the context of elder financial exploitation?
Answer: A situation where a person uses their position of power or trust to override an elder's free will to gain financial control
Undue influence occurs when someone exploits a position of trust, authority, or dependency to manipulate an older adult into financial decisions that benefit the influencer rather than the elder.
What is 'diminished financial capacity' and why is it important for a CFG to understand?
Answer: A decline in the ability to manage financial tasks due to cognitive impairment, increasing vulnerability to exploitation
Diminished financial capacity refers to a decline—often linked to cognitive impairment—in the ability to manage money and financial decisions, which makes older adults more susceptible to financial exploitation and errors.
Which document legally authorizes a trusted individual to manage an older adult's financial affairs if they become incapacitated?
Answer: A durable power of attorney (DPOA)
A durable power of attorney (DPOA) designates an agent to manage financial affairs and remains effective even if the principal becomes incapacitated.
What is a 'reverse mortgage' and what consumer protection concern is most associated with it for older adults?
Answer: A loan allowing seniors to borrow against home equity with repayment deferred until the home is sold or vacated; concern is aggressive marketing and misunderstanding of terms
A Home Equity Conversion Mortgage (HECM) lets seniors access home equity without monthly payments; consumer concerns include high fees, aggressive sales tactics, risk of displacement if taxes/insurance lapse, and heirs losing the home.
Which type of scam most commonly targets older adults through unsolicited phone calls or emails claiming they have won a prize or lottery?
Answer: Advance fee fraud (419 scam)
Advance fee fraud involves convincing victims they must pay fees or taxes upfront to claim a prize, inheritance, or lottery winnings that do not exist.
What is 'affinity fraud' and why are older adults particularly vulnerable to it?
Answer: Fraud where scammers exploit trust within a close-knit community or group to promote fraudulent investments
Affinity fraud exploits trust within religious, ethnic, professional, or social communities by having a trusted group member promote a fraudulent investment scheme to fellow members.