    [Senate Hearing 107-581]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 107-581

      SCHEMER, SCAMMERS, AND SWEETHEART DEALS: FINANCIAL PREDATORS OF THE
                                    ELDERLY
    =======================================================================

                                    HEARING

                                   before the

                           SPECIAL COMMITTEE ON AGING
                              UNITED STATES SENATE

                          ONE HUNDRED SEVENTH CONGRESS

                                 SECOND SESSION

                                   __________

                                 WASHINGTON, DC

                                   __________

                                  MAY 20, 2002

                                   __________

                               Serial No. 107-25

             Printed for the use of the Special Committee on Aging

                           U. S. GOVERNMENT PRINTING OFFICE
    80-873                          WASHINGTON : 2002
    ___________________________________________________________________________
    For Sale by the Superintendent of Documents, U.S. Government Printing Office
    Internet: bookstore.gpo.gov  Phone: toll free (866) 512-1800; (202) 512-1800
    Fax: (202) 512-2250 Mail: Stop SSOP, Washington, DC 20402-0001

                           SPECIAL COMMITTEE ON AGING

                      JOHN B. BREAUX, Louisiana, Chairman
    HARRY REID, Nevada                   LARRY CRAIG, Idaho, Ranking Member
    HERB KOHL, Wisconsin                 CONRAD BURNS, Montana
    JAMES M. JEFFORDS, Vermont           RICHARD SHELBY, Alabama
    RUSSELL D. FEINGOLD, Wisconsin       RICK SANTORUM, Pennsylvania
    RON WYDEN, Oregon                    SUSAN COLLINS, Maine
    BLANCHE L. LINCOLN, Arkansas         MIKE ENZI, Wyoming
    EVAN BAYH, Indiana                   TIM HUTCHINSON, Arkansas
    THOMAS R. CARPER, Delaware           JOHN ENSIGN, Nevada
    DEBBIE STABENOW, Michigan            CHUCK HAGEL, Nebraska
    JEAN CARNAHAN, Missouri              GORDON SMITH, Oregon
                        Michelle Easton, Staff Director
                   Lupe Wissel, Ranking Member Staff Director

                                      (ii)

                                C O N T E N T S

                                  ----------
                                                                       Page
    Opening Statement of Senator John Breaux.........................     1
    Prepared statement of Senator Larry E. Craig.....................     4

                                    Panel I

    Carl F. Fiosche, Gypsy Victim, Tacoma, WA (live via video
      teleconference)................................................     5
    Gertrude Gingerich, Traveler Victim, Hartly, DE..................    12
    William Blevins, on behalf of Vaughan Blevins, Manassas, VA......    17
    Bradley R. Graham, Detective, Tacoma Police Department, on behalf
      of Marie Bobo, Tacoma, WA......................................    24
    Justin Ray White, Prisoner, Idaho State Correctional Institute,
      Boise, ID......................................................    30
    Cesario ``Chayo'' Reyes, Retired Detective, Los Angeles Police
      Department, Elder Person's Estate Unit, and Elder Financial
      Protective Services, Cerritos, CA..............................    36
    Jane Brady, Attorney General, State of Delaware, Wilmington, DE..    42

                                    APPENDIX

    Statement from Thomas W. Richardson, Acting Deputy Assistant
      Director, Federal Bureau of Investigation......................    55
    Letter from Somerset County Department of Social Services........    59
    Information submitted on behalf of the Family Welfare Research
      and Training Group, University of Maryland, School of Social
      Work, Baltimore, MD............................................    61

                                     (iii)

     SCHEMERS, SCAMMERS, AND SWEETHEART DEALS: FINANCIAL PREDATORS OF THE
                                    ELDERLY

                                  ----------

                              MONDAY, MAY 20, 2002

                                           U.S. Senate,
                                    Special Committee on Aging,
                                                        Washington, DC.
        The committee met, pursuant to notice, at 2:07 p.m., in
    room SD-215, Dirksen Senate Office Building, Hon. John Breaux
    (chairman of the committee) presiding.
        Present: Senator Breaux.

           OPENING STATEMENT OF SENATOR JOHN BREAUX, CHAIRMAN

        The Chairman. The committee will please come to order.
        I want to thank all of our guests and all of our panel of
    witnesses who are with us, as well as our witness who is here
    via telecommunications for his testimony. I want to thank also
    the ranking member of the committee, Senator Larry Craig, for
    his support that he has given us throughout these hearings that
    we are undertaking.
        Over the years, we in the Congress have focused on
    different types of elderly mistreatment, including physical
    abuse and sexual abuse, emotional abuse or psychological abuse,
    abandonment or neglect, to name merely a few.
        This afternoon, we are going to focus on yet another form
    of elder abuse: the financial and material exploitation of our
    elderly. Elderly abuse in general is difficult to quantify.
    There is a large disparity between the number of cases reported
    and the number of those cases that are, in fact, unreported.
    This disparity is referred to as the ``iceberg theory,'' which
    is indicated on a chart that I have prepared.
        According to the National Elder Abuse Incidence Study, only
    16 percent of all elder abuse cases are actually reported. As
    you see, a large majority of the cases are not even ever
    reported to authorities. The financial and material loss is
    obviously devastating, but as my second chart points out, that
    is also just the tip of the iceberg. Financial independence is
    shattered, and long-term psychological and emotional scars may
    never be overcome. There is even data to conclude that a
    financially abuse elder has a higher risk of premature death.
        Let me take a moment to define the issue of financial and
    material exploitation. It is the illegal or improper use of an
    elder's funds, their money, their property, their assets. There
    have been a few attempts to quantify this crime. Most recently,
    the National Elder Abuse Incidence Study mandated by Congress
    was completed back in 1998. In this study, it was determined
    that 30 percent of all the reported and substantiated elder
    abuse cases were financial exploitation while 25 percent were
    physical abuse. There also have been studies outside of the
    United States, all of which indicate that the predominant type
    of reported elder abuse, after neglect, is financial abuse.
        Today's hearing this afternoon will focus on those in our
    society who exploit our vulnerable elder population, depleting
    their lifelong savings and exposing them to financial ruin, to
    emotional despair, and even death. The hearing will address
    several specific forms of financial exploitation that the
    current system has difficulty in defining, let alone
    preventing.
        It is not uncommon for these actions to evade the criminal
    justice system. What our panelists will show is that there are
    many psychological pieces to this criminal puzzle, such as
    diminished capacity, undue influence, and inability to consent.
    Seniors, like anyone, can be psychologically and intentionally
    manipulated for the purpose of taking their money. This is a
    tarnish on everyone's golden years, the period of our lives
    during which we all hope to be able to enjoy the fruits of our
    lifelong labors.
        This afternoon, we will hear a sampling of these cases
    involving family, home repairmen, professional criminal groups
    such as Travelers and Rom Gypsies that target the elderly.
        On this issue, let me say up front that it is not our
    intent to condemn all people who consider themselves Travelers
    or Rom Gypsies, but to focus on those within these groups where
    illegal activities are the main reason for their existence.
        It has been estimated that 70 percent of our Nation's
    wealth is held by people 50 years of age or older. Over the
    next 10 years, there will be $10 trillion in assets invested by
    the elderly, and financial predators, therefore, target the
    elderly for the same reason that Jean Lafitte pirated ships and
    Jesse James robbed banks and trains. That is where the money
    is.
        Looking into the future, even more opportunities for fraud
    and exploitation await senior citizens in the new millennium. A
    recent AARP survey revealed that 85 percent of individuals 60
    years and older want to stay in their own homes and live
    independently for as long as possible. We all have the right of
    self-determination and to live as we choose. But when there are
    sharks in the water, someone needs to pull those at risk to
    shore.
        As more and more of the baby boomers draw closer to senior
    citizen status, sons and daughters and grandchildren and our
    society must exercise vigilance in protecting those who have
    protected us during our vulnerable years.
        What we have found is that in most States the protective
    system currently in place, although very well intended, is
    fragmented at best. Public service professionals across our
    country unanimously agree that protection services, law
    enforcement, and prosecutors lack the special skills and
    training and funding and legislative support to properly
    investigate and resolve increasingly complex cases of elder
    financial abuse. With the lack of comprehensive, ongoing,
    reliable studies regarding the extent and the nature of elder
    financial abuse, there is very little information to help us
    focus on designing specific services and remedies to these
    problems. This hearing this afternoon will help to lift the
    veil from elder financial abuse and start us in a direction of
    creating a functional elder justice infrastructure.
        [The prepared statement of Senator Breaux follows along
    with a prepared statement of Senator Craig:]

                   Prepared Statement of Senator John Breaux

        Good morning. I would like to thank all of you, especially
    my fellow members, for attending today's investigative hearing.
    I would also like to thank the Committee's Ranking Member,
    Senator Larry Craig, for his support throughout this
    investigation. Finally, and most importantly, I would like to
    thank the witnesses for being here today. Your testimony will
    assist the Committee greatly in determining how best to address
    the vital issues raised today.
        Over the years, we in Congress have focused on different
    types of elder mistreatment including physical abuse, sexual
    abuse, emotional or psychological abuse, abandonment and
    neglect to merely name a few. Today we will focus on yet
    another form of elder abuse: the financial and material
    exploitation of our elderly. Elder abuse in general is
    difficult to quantify. There is a large disparity between the
    number of cases reported and those that go unreported. This
    disparity is referred to as ``The Iceberg Theory'' which is
    indicated on a chart I had prepared. According to the National
    Elder Abuse Incidence Study, only 16 percent of all elder abuse
    cases are actually reported. As you see, a large majority of
    these cases are not reported to authorities. The financial and
    material loss is obviously devastating, but as my second chart
    shows, that is also just the tip of the iceberg. Financial
    independence is shattered and long term psychological and
    emotional scars may never be overcome. There is even data to
    conclude that a financially abused elder has a higher risk of
    premature death.
        Let me take a moment to define the issue of financial and
    material exploitation: it is the illegal or improper use of an
    elder's funds, property or assets. There have been a few
    attempts to quantify this crime. Most recently the National
    Elder Abuse Incidence Study, mandated by Congress, was
    completed in 1998. In this study, it was determined that 30
    percent of all reported and substantiated elder abuse cases
    were financial exploitation while 25 percent were physical
    abuse. There have also been studies outside the US, all of
    which indicate that the predominant type of reported elder
    abuse (after neglect) is financial.
        Today's hearing, will focus on those in our society who
    exploit our vulnerable elder population--depleting their
    lifelong savings and exposing them to financial ruin, emotional
    despair and even death. The hearing will address several
    specific forms of financial exploitation that the current
    system has difficulty defining, let alone preventing. It is not
    uncommon for these actions to evade the criminal justice
    system. What our panelists will show is that there are many
    psychological pieces to this criminal puzzle such as diminished
    capacity, undue influence and the ability to consent. Seniors,
    like anyone, can be psychologically and intentionally
    manipulated for the purpose of taking their money. This is a
    tarnish on our Golden Years, the period of our lives during
    which we all hope to be able to enjoy the fruits of our
    lifelong labors. Today, we will hear a sampling of these cases
    involving family, home repairmen, and professional criminal
    groups such as Travelers and Rom Gypsies that target the
    elderly. On this issue, let me say up front that it is not our
    intent to condemn all people who consider themselves Travelers
    or Rom Gypsies, but to focus on those within these groups where
    illegal activities are the main fuel for their existence.
        It has been estimated that 70 percent of our nation's
    wealth is held by those 50 years old and above. Over the next
    10 years, there will be $10 trillion in assets invested by the
    elderly. Financial predators therefore target the elderly for
    the same reason that Jean Lafitte pirated ships and Jesse James
    robbed banks and trains--it's where the money is. Looking into
    the future, even more opportunities for fraud and exploitation
    await senior citizens in the new millennium.
        A recent AARP survey revealed that 85 percent of
    individuals 60 years and older want to stay in their homes and
    live independently for as long as possible. We all have the
    right of self determination and to live as we choose, but when
    there are sharks in the waters, someone needs to pull those at
    risk to shore. As more and more of the Baby Boomers draw closer
    to senior citizen status, sons, daughters, grandchildren, and
    our society must exercise vigilance in protecting those who
    have protected us during our vulnerable years.
        What we have found is that in most states, the protective
    system currently in place, although well intended, is
    fragmented at best. Public service professionals across our
    country unanimously agree that protection services, law
    enforcement and prosecutors lack the special skills, training,
    funding and legislative support to properly investigate and
    resolve increasingly complex cases of elder financial abuse.
    With the lack of comprehensive, ongoing, reliable studies
    regarding the extent and nature of elder financial abuse, there
    is little information to help us focus on designing specific
    services and remedies. This hearing will help to lift the veil
    from elder financial abuse and start us in the direction of
    creating a functional elder justice infrastructure.
                                    ------

                   Prepared Statement of Senator Larry Craig

        Thank you Senator Breaux for holding this hearing on the
    financial exploitation of the elderly. As you may recall, I
    held a hearing on the topic of Elder Abuse last year. At that
    hearing, we heard testimony from JoAnne Hopper, a victim from
    Idaho, who was financially exploited by her son. I am pleased
    that this committee is continuing to examine various aspects of
    elder abuse, including financial crimes perpetrated against our
    most vulnerable citizens.
        For the elderly, losing the fruits of a lifetime's labor
    can be devastating. Financial crimes can strip away a victim's
    independence, security, and dignity. These crimes destroy
    legacies, and may lead to depression, hopelessness, and
    despair. To the Seniors who have lost their life savings,
    financial crimes are no less devastating than violent crimes.
        To effectively fight these crimes, it is critical that
    existing laws be vigorously enforced: Laws like the one that
    put Justin Ray White behind bars. Mr. White perpetrated crimes
    against seniors in at least five North Western states. In his
    long and shameful career, Mr. White robbed seniors of literally
    millions of dollars in assets. His financial assaults upon the
    elderly came to an abrupt end when he was caught and prosecuted
    by law enforcement officials in Clearwater County, Idaho.
        Idaho laws also encourage banks to report suspected
    instances of elder financial abuse to local authorities. Banks
    in Idaho, in cooperation with state agencies, provide training
    to their employees on how to identify and prevent financial
    crime. Idaho is only 1 of only 5 states to implement such a
    program. I intend to have ongoing conversations with the
    Department of Justice on several issues.
        We will discuss making training and technical assistance
    available to state and local law enforcement on the effective
    investigation and prosecution of crimes against the elderly .
        We will also look at current resources and grant money that
    could target financial exploitation and other aspects of Elder
    Abuse. And overall, we will explore enhancing the effectiveness
    of inter-agency cooperation and multi-disciplinary approaches
    in responding to cases of elder abuse at both the state and
    Federal level.
        These constructive steps will serve to put in place
    effective mechanisms for ensuring that our most vulnerable
    citizens are protected from financial abuse and other forms of
    elder crime.

        I want to welcome all of our panel of witnesses. We are
    going to take Mr. Carl Fiosche. Mr. Fiosche, can you hear us?
    Am I pronouncing your name anywhere close to being to correct?
        Mr. Fiosche. That is close enough.
        The Chairman. Close enough. Well, thank you very much.
        Mr. Fiosche joins us this afternoon from Tacoma, WA, and we
    would be very pleased to have you give us your statement if you
    would go ahead, Mr. Fiosche.

          STATEMENT OF CARL FIOSCHE, GYPSY VICTIM, TACOMA, WA

        Mr. Fiosche. My name is Carl Fiosche, and I am 79 years
    old. I live in Tacoma, WA. I am a World War II veteran. I
    served in the South Pacific in air-sea rescue.
        I am the victim of a sweetheart scam by a woman named
    Angela, who I later learned is a member of the Romany Gypsy
    clan. Angela is probably about 50 years younger than me. In
    about 4 months, we now estimate that she took about $70,000
    from me. She got my house worth more than $109,000. The damage
    would have been worse except that someone called Adult
    Protective Services and I got help. As it is, I had to file for
    bankruptcy.
        Before I met Angela, I lived in my house alone. I have a
    few friends and some good neighbors, but I really don't have
    any relatives. Since my mother died about 12 years ago, I am by
    myself a lot. I have always been a bachelor. I took care of
    myself. I drove my car to go out grocery shopping. I had a lot
    of medical appointments at the American Lake Veteran
    Administration.
        I had a sufficient amount of money that I saved over the
    years. My only income is Social Security and a small veteran's
    pension. I owned my own home free and clear. I had almost no
    bills. I paid all my bills every month on time. I had good
    credit.
        I think it was around the spring or summer of 2001 that I
    had just gotten out of the hospital for double pneumonia. That
    is when I met Angela at my bank. When I was in the bank, I saw
    this guy on a cell phone walking back and forth. I later found
    out it was Angela's friend, Nic. Now, Nic spotted me in the
    bank and told her when I was coming out. When I went out to my
    car, Angela was in the parking lot. She asked if I was Italian.
    I had an Italian bumper sticker on my car, and I said yes. She
    said she is Italian, too. We started talking and she asked for
    my phone number. I gave it to her. That is how we met.
        About a week later, she called me and asked me to go out
    for lunch. She said she was falling for me right then.
        It wasn't long before she said she needed money. She asked
    if I could give her $600 for a telephone bill and rent. I said
    OK. I started to write a check, but she said she doesn't take
    checks, just cash. I gave her $1,000.
        Angela got romantic really fast. She would say she is
    falling for me. She would kiss me and hug me. Angela said, ``I
    will take care of you the rest of your life.'' She said, ``You
    don't want to go into a nursing home. I will take care of
    you.'' She said she was in love with me. I said I loved her,
    too. I would say, ``I love you.'' She would say, ``I love you
    more,'' and we would go back and forth like that.
        Angela would see me at least a few times a week. She took
    me to some doctor's appointments. She drove me to the bank. I
    would take money out and give most of it to her right then and
    the rest later. I heard her on the phone at my house one day,
    and I heard her say, ``He would just go in the bank and come
    out with a handful of money.'' I sensed after a while maybe I
    was being taken. But I wasn't thinking clearly. I was sick and
    she said she would take care of me. I trusted her.
        She would ask me for money, but she would never let me
    write checks to her. She said never put anything like that in
    her name. She had to have cash. So I wrote checks to cash and
    gave her the money.
        I gave her $27,000 in cash I had in a safety deposit box.
    She said she needed $25,000 to start a coffee business. Later
    she said she needed $1,000 for coffee. I gave it to her in
    cash. One day I asked her what happened to the money. She said
    they lost it gambling.
        Sometimes Angela brought a young girl who goes to the fifth
    or sixth grade. I heard Angela tell the girl, ``This is how you
    do it.'' Then Angela came and sat in my lap, and she would be
    sweet to me.
        I asked Angela about Nic. I don't know if he was her
    husband or what. She said he didn't care, as long as she gave
    him the money everything will be all right.
        On September 12, 2001, the day after 9/11, Angela came
    over, and when we were just talking, she asked me about the
    house. I told her I was going to make a will and leave it to my
    neighbors because they were good friends to me. Now that Angela
    was with me, I said I would put her in the will. Angela went
    into the kitchen and called someone. She said, ``Let's go for a
    ride, pick up Nic.''
        They took me to a house. A notary lived there. Nic was
    telling the notary person what to write. I sat on the bed. I
    didn't say anything. I felt sick--I mean, I was sick--and I
    couldn't walk so I just listened. I was awake but couldn't
    comprehend. They said they made a deed and they wanted me to
    sign it. I said I wanted to talk to my attorney. They said that
    Nic knows what he is doing. It will all be done here. I thought
    they were going to beat me if I didn't sign. I didn't want to
    sign it, but I signed it. The deed put my home in Angela's
    name. They never paid me anything for my home.
        Back then I couldn't hardly see or read. I felt like I was
    in a fog. I was pretty sick then.
        Angela did a lot of shopping on my credit cards. She said
    she wanted everything. She took me to the mall and put me in a
    wheelchair and left me sitting. When she bought things, she
    would wheel me over and she told me to sign for them. What
    could I do? I signed. I didn't know what I was doing.
        She got furniture, dishes, a sleigh bed. I don't know what
    all she brought. She got a watch for $2,000. But she took the
    watch back and got the money for it. One time she left me
    sitting in the car and had the salesman come out to the car.
        Angela told me every place you go, you must always apply
    for a credit card. But I didn't need any more credit cards.
    Later, I found out that about 20 businesses did a credit check
    on me during the time I was with Angela.
        Angela said she didn't have any transportation. She said if
    I gave her $10,000, she would get a pick-up truck from Nic. I
    gave her the money. But she never bought the truck.
        The way that I got help was that one day I fell down and
    had to call for an ambulance. I must have said something about
    Angela. Adult Protective Services came to see me, and then a
    couple of police.
        My lawyer from legal services helped me to file a lawsuit
    to sue Angela, but she probably doesn't keep any property or
    assets in her name. I got a protection order against Angela and
    Nic to keep them away from me. My house will be sold in the
    bankruptcy to pay all of my creditors. I don't know what the
    police have done. They never talked to me since the first time
    they came to see me.
        [The prepared statement of Mr. Fiosche follows:]
        [GRAPHIC] [TIFF OMITTED] 80873.001

        [GRAPHIC] [TIFF OMITTED] 80873.002

        [GRAPHIC] [TIFF OMITTED] 80873.003

        The Chairman. Well, thank you very much, Mr. Fiosche, for
    that statement. How are you doing today?
        Mr. Fiosche. I am doing better.
        The Chairman. Do you know if anyone has ever taken any kind
    of enforcement action against Angela and Nic from the police
    standpoint? Was she ever arrested or anything, do you know?
        Mr. Fiosche. No, she never was arrested. I don't think they
    had any investigation or anything on her.
        The Chairman. Did you ever go to anyone for any help during
    this period when Angela was asking you for money? Was there
    anybody that you could go to for advice as to whether this was
    the right thing to do or not?
        Mr. Fiosche. No, I didn't have anybody to go to.
        The Chairman. When the police--how did they get involved in
    this case with Angela? Was it the Adult Protective Service that
    brought them in to talk to you?
        Mr. Fiosche. Yes.
        The Chairman. But you don't know if she has ever been
    prosecuted or arrested?
        Mr. Fiosche. She has never been prosecuted or arrested that
    I know of.
        The Chairman. Do you have any idea, Mr. Fiosche, how much
    money that you ultimately transferred over to Angela,
    approximately? A ball-park figure.
        Mr. Fiosche. About $70,000.
        The Chairman. I understand that you had to put your house--
    --
        Mr. Fiosche. Plus the house.
        The Chairman. Plus your house you had to put up for sale,
    as I understand it.
        Mr. Fiosche. $109,000.
        The Chairman. So around $180,000 she was able to get from
    you. Over what period of time? How long was it, about? A year?
    Or how long was it?
        Mr. Fiosche. About 6 or 7 months.
        The Chairman. About 6 or 7 months. I take it you were
    living alone when all of this was occurring in your own home?
        Mr. Fiosche. Yes, I had just gotten out of the hospital at
    the VA, and I was alone, and I met her when I went to the bank.
        The Chairman. Well, Mr. Fiosche, we and the Congress want
    to say how sorry we are that this happened to you and that we
    are back here in Washington, DC., working on legislation which
    will hopefully create a system so that people like yourself
    will never have to go through this type of experience again. I
    just want to say thank you so very much for sharing your story.
    It is not easy to tell the story you just told to this
    committee, but I think that what you have done is give us an
    indication of what happens far too often. Don't feel like you
    are the only person that this has happened to. These groups in
    many cases are professionals, and a person like you or like any
    of us could be subjected to the same type of scam and never
    really realize it. So don't feel bad. You are not the only one
    that this has happened to. There are literally thousands and
    thousands of Americans that have had the same type of scam put
    upon them as you have suffered. So we thank you so very much.
    You have been very, very helpful.
        Mr. Fiosche. Thank you, Senator Breaux, for having this
    hearing.
        The Chairman. Well, I appreciate it, and we will stay in
    touch with you. We wish you the very best in the future.
        Mr. Fiosche. Thank you.
        The Chairman. OK. Bye-bye.
        Mr. Fiosche. Good-bye.
        The Chairman. We want to thank Mr. Fiosche for joining with
    us. He was not able to travel, but we do have an excellent
    panel who is going to share their stories as well.
        I would like to welcome as our next witness from Delaware,
    from Hartly, DE, Ms. Gertrude Gingerich. Now, Ms. Gingerich,
    you and I have already talked, so we are glad that you are
    here. We just want to hear your story, and just feel free to
    tell us any way you want.

      STATEMENT OF GERTRUDE GINGERICH, TRAVELER VICTIM, HARTLY, DE

        Ms. Gingerich. My name is Gertie Gingerich.
        The Chairman. Mr. Blevins, if you would help her with that
    mike and put it right in front of her, there you go. That will
    be fine. You probably haven't spoken before too many mikes.
    Pretend it is not even there.
        Ms. Gingerich. My name is Gertie Gingerich, and I am 72
    years old. My husband is 77 and confined to a wheelchair after
    his last stroke. We live alone, though some of our children
    live close by.
        On December 19, 2001, my husband was away at the center. It
    was an unusually warm day, and as I was eating my lunch, there
    was a knock on the door. As I got up to answer, a young man
    walked in and asked if I had any roof leaks. I said I do. He
    said he would go get some more materials and be right back. He
    wasn't long. He went up on my roof and was spraying some black
    tar stuff on the roof. He also had two other men with him: one
    older man who claimed to be his father, and another man.
        The father came into the house, and he was talking to me,
    and he told me how he had high blood pressure, and he talked
    about his son, that he had just got married, and that he would
    give me a good price on the work that he was doing. Then he
    went back outside, and when I looked out the window, I saw them
    scrubbing my car. They had gotten tar all over my car. In about
    an hour and a half, they were finished and brought me a bill.
    It had his name and cell phone number on it and it had a 5-year
    warranty. The amount was $4,850. I said, ``My goodness.'' But I
    wrote him a check for the amount he wanted. He said he would be
    back the next day to put up a gutter for me over the back door.
        He did come back the next day with his helper. They put up
    approximately a 16-foot piece of gutter and one downspout. He
    brought me another bill of $750, which I paid by check. I saw
    that he ran the downspout on my deck, and I said I didn't want
    it like that. He said if I didn't like it to call him later and
    he would fix it like I wanted it.
        A few days went by, and my daughter-in-law asked me what
    those guys were doing on my roof, and I told her that I got the
    roof fixed. She didn't ask what it cost and I didn't tell her.
        However, I did tell my sister that I got the roof fixed,
    sprayed off, and I told her what it had cost me. She then told
    her daughter, my niece, who had a fit. Her husband, who is a
    contractor, checked out the work that was done. He said they
    had used driveway sealer and that it was not intended for using
    on asphalt shingles. He said that I was intentionally misled by
    materials they had used. My niece then asked me if I would mind
    if she would check into this and see what she could do about
    getting my money back. I said, ``No, I don't mind.'' I didn't
    tell my husband or the children or anyone else about this
    because I felt kind of dumb.
        My niece called the Delaware State Troop 3 and spoke to a
    trooper who then transferred her to a detective. He didn't seem
    at all interested and told her to call back the second week in
    January. She then called 911 and they again placed her to Troop
    3, and they again told her to--put her through to the
    detective's desk. She told her story to the trooper there. He
    said she would need to speak to a detective. She told him she
    did earlier and he didn't seem interested, that he told her to
    call back the second week in January. So he gave her the name
    of Lester Johnson and his phone number. Mr. Johnson works for
    the Attorney General's office, a unit which specializes in
    crimes against the elderly. She then called Lester Johnson and
    gave him my story, and he said to call 911 and get an officer
    out there to do a report. She did that, and they told her I had
    to call myself. When I called, they just gave me a runaround. I
    told my niece what they said, so she called Lester Johnson
    again. Mr. Johnson seemed irritated with the police and said he
    would take care of it himself. I wasn't long in getting a call
    from Troop 3. An officer was on his way to take a report.
        Mr. Johnson, the trooper, and my niece all wanted to be
    there when this guy would come back. I called this guy, and he
    said he would come back out once the weather got nicer.
        I called him a second time and left a message asking him to
    give me a day and time to be there. I told him I needed to know
    so I could be there.
        I came home almost noon on January 29 when my daughter-in-
    law called me and told me I had just missed the man who had
    fixed my gutter. I called him on his cell phone right away, and
    he said he would be there in about 5 minutes. I then called my
    niece and told her, and I called Lester Johnson and left a
    message for him. I called the trooper, and they said they would
    get someone right out. Mr. Johnson called back and said he was
    on his way, try to keep them there, keep them long enough for
    everyone to get there. All three of the men were here again. My
    son, who lives next door, came over. They fixed the down spout.
    Then they pointed out how uneven my basement was. They took me
    down to show me what they needed to do to fix it. They wanted
    to get to work on the basement right away. Of course, I
    wouldn't let them. My niece came over and took pictures of the
    truck and wrote the tag down, trying not to be seen. Then the
    trooper came, and soon after that Mr. Johnson and his
    assistant, who is a senior volunteer, were there. Another
    trooper came out also. All three were checked out, and one of
    them was arrested. The other two were free to go. The guy who
    was arrested pulled out a big roll of cash from his pocket and
    gave some to the police officer, who counted it and gave it to
    Mr. Johnson, who also counted it, and then passed it on to me
    and told me to count it. It was every dollar back that I had
    paid to the guy. The guy was handcuffed and placed in the back
    seat of the trooper's car.
        I want to thank the officers and especially Mr. Johnson for
    all their help. If it wasn't for Mr. Johnson, this guy would
    still be out there taking advantage of the elderly. Mr. Johnson
    is here with me today, right here.
        [The prepared statement of Ms. Gingerich follows:]
        [GRAPHIC] [TIFF OMITTED] 80873.004

        [GRAPHIC] [TIFF OMITTED] 80873.005

        The Chairman. Ms. Gingerich, thank you very much. That was
    an incredible story, and you told it very clearly, and you did
    a terrific job, and we thank you very much for sharing that
    experience with this committee and with an awful lot of
    Americans.
        Next we are going to hear from Mr. Bill Blevins on behalf
    of, I understand, your cousin, I think, Vaughan Blevins?
        Mr. Blevins. That is correct.
        The Chairman. Mr. Blevins, go ahead.

      STATEMENT OF WILLIAM BLEVINS, ON BEHALF OF VAUGHAN BLEVINS,
                              MANASSAS, VA

        Mr. Blevins. Mr. Chairman, members of the committee, I am
    Bill Blevins from Prince William County, VA. I was born and
    raised in Fairfax County, VA. I am pleased to represent my
    cousin, 72-year-old Vaughan Blevins, of Fairfax County, VA, and
    over 200 others who have been exploited financially by a career
    con man--Larry C. Henderson. At present I am the legal guardian
    and conservator for Vaughan Blevins.
        On November 12, 1997, I was notified through the Manassas
    Park Police Department that Vaughan had been found lost and
    confused adjacent to their headquarters building. He was very
    hungry, had only $3 in his wallet, along with instructions to
    contact a Mr. Larry Henderson in case of emergency. Larry was
    notified and came to pick him up. The officers on duty were
    suspicious and contacted Vaughan's insurance agent whose card
    fortunately was also in the wallet. This led to me being
    called.
        When I confronted Larry--that was the next day--about his
    financial dealings with Vaughan, he denied everything. When
    Larry denied knowing anything about any previous dealings,
    Vaughan threw up his arms and charged Larry, not unlike a caged
    animal turned loose, and began shouting, ``You know Larry, you
    know.'' Vaughan Blevins is a very timid, friendly individual. I
    had never seen him in this type of rage in my lifetime. Even
    Larry was obviously very surprised.
        After that, I took Vaughan to stay with me at my mother's
    home in Fairfax County, VA. I also notified Adult Protective
    Services of Fairfax County. That was on November 13, 1997.
        In the next few days, the following became very evidence:
    Vaughan only had $14.21 in the bank, with the account being
    emptied out monthly as soon as Vaughan's pension was
    automatically deposited; there were numerous outstanding loans
    using Vaughan's property as collateral; Vaughan was checked out
    medically and found to be severely malnourished, lacked
    necessary medical supervision for at least 2 years, suffering
    from dementia and mental abuse; Adult Protective Services made
    me aware that Larry Henderson was being investigated by Fairfax
    County Criminal Investigation Division regarding another victim
    and had been taking advantage of another victim for
    approximately 3 years who also had dementia, and had a history
    of seeking out that type of victim. He had a prior history with
    APS, not only in Fairfax County but in other jurisdictions.
        I interviewed with Fairfax County CID and was told it would
    take about 60 days to formulate a case. I was told Vaughan made
    a poor witness because of his dementia. I was reminded that
    Larry Henderson had certain rights, including the right to face
    his accuser. My response was the Constitution's guarantee of
    equal rights and protection for everyone. Let's let a judge and
    jury decide. I was reminded more than one that it wasn't a
    crime for someone to ``give their money away.'' I found and
    still find this comment unsuitable and demeaning to a victim
    with diminished capacity.
        I asked around and I heard of more past and present victims
    of Larry Henderson in Fairfax County and other jurisdictions.
    When notified, the Fairfax County Police Department seemed
    disinterested.
        I was astonished to find that Larry Henderson had a civil
    and criminal background unrivaled by few, if any. I contacted
    as many victims as possible. All were very helpful. Nearly all
    were elderly. They in turn knew of others who had bad
    experiences with Larry Henderson. I asked many why they hadn't
    gone to the police. Some had, with few results. Some victims
    were second generation. Some victims were related. It was
    obvious Larry Henderson sought out a certain  victim  profile:
    elderly,  preferably a  widow  or widower; diminished capacity;
    rural and/or older communities; they often had a recent
    obituary listing; small social group with other elderly
    persons; older residences in need of some repair or
    maintenance; and some religious interest.
        To accommodate these profiles, Larry Henderson would often
    portray himself as: a former friend or business associate of a
    recently deceased loved one; a preacher or minister; a
    contractor down on his luck; and a nice guy, often buying a
    round of coffee, while sorting out a potential victim.
        Larry began exploiting Vaughan as early as 1991, as well as
    each year thereafter, cleaning out nearly his entire bank
    account--in fact, his entire bank account for each year
    thereafter. Bonds cashed, existing bank accounts empties,
    subsequent earnings and money from unknown sources were
    laundered through Vaughan's account approaching $600,000. That
    is probably a very conservative estimate. I am still finding
    money, still finding assets. They come in periodically.
        Larry Henderson developed a certain hold over Vaughan.
    Vaughan was conditioned to think he had to ask for permission
    to eat, to go somewhere, to use the bathroom and perform
    simple, everyday tasks. In the 6 weeks it took him to get him
    deprogrammed and to get his house habitable again with the
    assistance of APS, it was always, ``Do I have to ask Larry?''
    ``Where's Larry?'' ``What will Larry say?'' et cetera.
        During the 6 weeks of deprogramming sessions, Vaughan would
    sometimes, especially at night, want to talk. He would want to
    confide in me. He would ask, ``Why did Larry do that to me?''
    ``What's going to happen to me?'' ``Am I going to die?''
    Sometimes, as reality would set in, he would cry or sob and
    blame himself for allowing things to occur as they did.
        Larry Henderson didn't confine himself to the extreme
    Northern Virginia area. He has a history in approximately the
    upper one-fourth of the State of Virginia, particularly
    Fairfax, Prince William, some in Arlington, Fauquier, Loudoun,
    Clarke, Frederick, and Warren counties, as well as the
    independent cities and towns. He has a history in eastern West
    Virginia--he is a serial bankruptcy filer; the three filings
    would all bear that out--as well as Maryland, Delaware, New
    Jersey, southern New York, and Louisiana. I was told that he
    once took approximately eight to ten widows and widowers for
    about $100,000 in the Route 28 corridor in western Prince
    William and Fauquier County. All those names appeared on prior
    bankruptcy filings. Only the amounts were diminished. Two of
    those people lost their country store. One lost a farm. All the
    names appeared on Larry Henderson's previous bankruptcy
    filings, as I just pointed out.
        Larry Henderson did a small amount of work for the
    homeowners' association president in the affluent Mantua
    Subdivision in Fairfax County. He gave her name as a reference
    and scammed several other homeowners in the community. She
    served as a prop for his many schemes in that community. He had
    one reported and he had to refund the money or face a
    conviction, and he was convicted in another jurisdiction, as
    that was where the money changed hands and technically that is
    where the crime occurred. That jurisdiction is the city of
    Manassas Park, VA. If not for the effort and diligence of
    Investigator Tony DeFelice, Larry Henderson would probably not
    be in jail today. Investigator DeFelice is sitting behind me
    today. He is very well thought of in the community, I might
    add, as a law enforcement officer.
        It was Investigator DeFelice who was called in when I
    discovered Larry Henderson had a 186-day-old felony warrant in
    Fairfax County and he had it served on him. This is the only
    conviction in Fairfax County and they had sat on it for over 6
    months.
        I asked CID, by the way, if they would like a list of the
    victims that had occurred in that 6-month-plus period.
        Investigator DeFelice was instrumental in getting Prince
    William County to prosecute two other cases against Larry
    Henderson. Unfortunately, Fairfax County could have added at
    least one year to Larry Henderson's present Virginia prison
    term. Despite the presence of five representatives from other
    jurisdictions, some on their own time, they dropped charges on
    a felony. In short, in the overall scheme of things, for
    whatever reason, Fairfax County has been very kind to Mr.
    Henderson.
        I am told Larry Henderson will be out of the Virginia State
    Penitentiary next March 2003, having served 3 years of a 6-year
    sentence. He will then begin serving an 8-year Federal
    sentence.
        Looking back, it has been very frustrating getting
    assistance and the proper representation for Vaughan Blevins,
    who, I might add, is a veteran and a former civil servant
    himself, and one of the victims that Mr. Henderson took
    advantage of, Dorothy Robertson, is also a former civil servant
    for years for Fairfax County. Her husband was a veteran.
        I would recommending the following to Congress: Federal
    statute or statutes to protect people with diminished capacity;
    a national registry for those who victimize people with
    diminished capacity; mandatory statutes to make banks and
    lending institutions report suspicious activity and/or
    suspicious loan applications; and strict guidelines governing
    loan applications.
        I would like to point out that Mr. Henderson often used the
    very weak statutes and guidelines in the State of Virginia
    governing contracting fraud. They are among the weakest, if not
    the weakest in the country. Despite complaints to State
    delegates, the State Attorney General's office, the Crime
    Prevention Bureau, the Director and Assistant Director, not one
    law in the last five general sessions since 1997 has been
    strengthened. If anything, some have been weakened.
        I ask what will be the result of today's hearing. Others
    and I have been forced to settle with disappointment in the
    last 5 years. I often wonder if this will be another
    disappointment, and I will anxiously await the results.
        [The prepared statement of Mr. Blevins follows:]
        [GRAPHIC] [TIFF OMITTED] 80873.006

        [GRAPHIC] [TIFF OMITTED] 80873.007

        [GRAPHIC] [TIFF OMITTED] 80873.008

        The Chairman. Well, thank you very much, Mr. Blevins. I
    hope, too, that you won't be disappointed, and that is going to
    be our real effort here.
        Next we will hear----
        Mr. Blevins. Could I point out one thing, please? I don't
    mean to interrupt.
        The Chairman. Sure.
        Mr. Blevins. Each day, that is, the end of today, tomorrow,
    and each day thereafter, $1 million passes hands in the State
    of Virginia--and that is a very conservative number--through
    contractor fraud.
        The Chairman. Thank you. Strong statistics.
        Next we will hear from Detective Brad Graham with the
    Tacoma Police Department. Mr. Graham, thank you very much for
    being with us.

       STATEMENT OF BRADLEY R. GRAHAM, DETECTIVE, TACOMA POLICE
            DEPARTMENT, ON BEHALF OF MARIE BOBO, TACOMA, WA

        Mr. Graham. Thank you. Good afternoon, Mr. Chairman. I am a
    detective with the Tacoma, WA, Police Department assigned to
    the Special Assaults Unit. In January of this year, I became
    involved in the case of State of Washington v. Margaret M.
    Bobo, a case of criminal mistreatment.
        The victim, 81-year-old Marie Bobo, lived in a single-
    family home in Tacoma. She retired from her civil service job
    over 20 years ago and lived solely on her retirement check.
    There is no record of her ever applying for or receiving any
    State public assistance.
        On January 14 of this year, the victim's daughter,
    Margaret, made a 911 call asking for assistance with her mother
    who had fallen in the house. Margaret told the dispatcher she
    was unable to pick her mother up. When Fire/Rescue arrived,
    they found Marie, naked from the waist down, on the floor
    inside the home unable to move. They found her in that first
    picture you see, sir.
        Fire fighters had to remove the outer door from the hinges
    and climb over stacks of garbage and household trash that in
    places went from floor to ceiling. They found her literally
    stuck to the trash by her own feces. Pieces of her skin were
    pulled from her body as they lifted her for transport to a
    hospital. The home was filled with feces and rodents.
        Police were summoned to the hospital to interview the
    victim. The responding officer was required by hospital staff
    to don a protective suit because the victim had unidentified
    inset life coming out of the wounds on her body. She was
    clearly disoriented and unable to give officers a clear picture
    of what had happened.
        The victim weighed 88 pounds, was malnourished and
    dehydrated. She suffered from a condition called contracture of
    the legs and hips. This condition results when a limb has not
    been moved for a significant period of time. In this case, the
    legs and hips were stuck in the fetal position, as you see,
    sir. She got this way from having been left, unmoved, for
    several months. The skin around her toes was blackened and
    dead. Any attempt to manipulate her legs was and still is
    painful to her. She had bedsores on her buttocks and elbows.
    Her skin was dry and scaly and began to come off as it was
    being cleaned for the first time in months.
        There is no hope now that her legs will ever function
    again. There was concern that she would require some amputation
    to prevent infection. Only now, after 5 months of treatment and
    evaluation, is she able to be placed into a reclining chair.
    The medical plan calls for treatment of the tendons in her legs
    to release them to point of getting her into a wheelchair,
    hopefully. This will give her something she really has not
    experienced in over a year--mobility.
        Interviews with the victim were limited due to her mental
    state. She was able to recall that her daughter lives with her
    but doesn't spend the night. Her daughter visits her daily to
    bring her food and water. She was not able to recall where she
    slept, when she last used a bathroom, when she was last able to
    move her legs, or how much money she got from a retirement
    check which she did know she received.
        Her daughter was arrested for criminal mistreatment and
    criminal abandonment. In a post-arrest interview, the daughter
    admitted that she shared a joint bank account with her mother.
    A direct deposit of the mother's retirement check of
    approximately $910 was made monthly to that account.
        Asked to account for the money being withdrawn, the
    daughter said she used the money to repay a home loan in her
    mother's name, her mother's utility bills, and for food.
    Reminded of her mother's malnourished condition, she still
    insisted that roughly $200 a month went to feed her mother. She
    further indicated that her mother wanted to contribute enough
    money to pay for the daughter's rent on an apartment across
    town.
        The daughter indicated that she visits the home daily, in
    the afternoon, to bring her mother a meal consisting generally
    of soup, sandwiches, and cookies. Asked what her mother did for
    meals when there was no one there to help, she said, ``My
    mother just doesn't eat breakfast.'' A check of the home's
    utility records showed that the home's power and water usage
    were significantly below normal. At times during the past year,
    there were months when the home showed no measurable water
    usage. The home's gas was shut off some time ago, thereby
    cutting off the primary source of heat.
        Subpoenas to the victim's bank showed a shared account
    between the victim and the daughter. Records show that each
    month a retirement check was deposited into that account and on
    the exact same date that entire amount was withdrawn in cash.
    This left a constant balance of less than $5 in the checking
    account.
        Financial records show that in early 2000, at the age of
    80, the victim was given a loan against her home for household
    repairs. The deed shows the loan to be for $20,000 payable over
    a 25-year period. Her monthly payments on that loan were $350 a
    month.
        Proactive intervention in elder abuse by law enforcement
    is, at best, difficult. Last year, Tacoma PD responded to
    approximately 175,000 calls for service. Nearly 2,000 offenses
    were reported to be against victims age 62 and older. When
    police have to struggle to keep up with reported crime, any
    proactive efforts will suffer. Most crimes-against-persons
    cases must be triaged by detectives to determine the level of
    solvability before investing time and resources into an
    investigation. Sadly, the threshold of what is solvable tends
    to be inversely proportionate to the increase in our caseload.
        I believe a big part of the solution lies in public
    awareness. We need to make people as focused on elder issues as
    they are to child abuse issues. We must teach people with
    regular elder contact to be more attuned to the signs and
    symptoms of this problem. Educating people like letter
    carriers, power meter readers, neighborhood shop owners, and
    beat cops could go a long way toward early intervention and
    prevention.
        Financial abuse is a particularly difficult case to work.
    The suspects are often relatives, close friends, or caregivers
    who have been given access to the funds, such as was in the
    Bobo case. Twenty years of retirement payments and the bank
    account had a near-zero balance. Of additional concern has to
    be the loan and the lack of guidance in her obtaining of it. We
    have here in this case an 80-year-old woman who was given a 25-
    year home loan with monthly payments in excess of 30 percent of
    her monthly income. There has to be some way to exercise some
    oversight against predatory lending agencies who see the
    elderly as an easy target.
        In my 15 years of law enforcement, I have never experienced
    the same roller-coaster ride of emotions as I did with this
    case. I will never forget the images indelibly printed in my
    mind of this poor old woman lying crippled in her own little
    chamber of horrors there and my bewilderment as to how this
    could have happened right in front of us.
        Thank you, sir.
        [The prepared statement of Mr. Graham follows:]
        [GRAPHIC] [TIFF OMITTED] 80873.009

        [GRAPHIC] [TIFF OMITTED] 80873.010

        [GRAPHIC] [TIFF OMITTED] 80873.011

        The Chairman. Mr. Graham, that story is almost too
    difficult to tell. Just unbelievable.
        Mr. Graham. Yes, sir.
        The Chairman. Thank you very much for telling it because it
    is very important.
        Next we are going to hear from Mr. Justin Ray White who is
    with us from the Idaho State Correctional Institute in Boise,
    ID. Mr. White.

         STATEMENT OF JUSTIN RAY WHITE, PRISONER, IDAHO STATE
                   CORRECTIONAL INSTITUTE, BOISE, ID

        Mr. White. Hello. My name is Justin White.
        The Chairman. Mr. White, pull that mike down a bit closer
    so we might hear it more clearly.
        Mr. White. My name is Justin White, and I am an ex-Traveler
    from the Pacific Northwest. I am an inmate at the Idaho State
    Correctional Institute, and I am currently serving a 10-year
    sentence for grand theft and using a false ID. I was born in
    Idaho into the Traveler way of life.
        When I was a young boy at the age of 10, I can remember
    peddling flowers and candy and cheap leather wallets at bars,
    stores, and beauty salons. I would get a percentage of whatever
    I sold for the night from my father, who was a Traveler. I was
    a poor salesman at the time, but as the years advanced, I got
    better at it. When I turned about 13 years old, I started
    working on the road with my father, and I can still remember
    him telling me if anyone asked where we were from, tell them we
    lived at such and such town, lane and address. We always had a
    story ready. I remember my dad having me roll down the windows
    so I could hear him talk to the elderly people and pick up
    pointers on how to hustle them.
        When we were looking for a job, I would watch out my side
    looking for old people while my father paid attention to his
    side of the street and drove. We would pick our houses by the
    looks of them: old cars, no toys lying around, yards that are
    kept up real nice, single names on the mail boxes. By the time
    I was 15 years old, I had heard enough and seen enough to know
    this was a great life and an easy life. I didn't need much
    schooling or any kind of education as far as that went. All the
    Traveler kids hardly ever went to school. We learned what we
    had to do from our fathers, and that was to lie and cheat and
    scam for the almighty dollar. All I ever wanted was to be like
    my dad and my uncles and be like a high roller.
        The Traveler's way of life was the only way of life, easy
    money all the time. You wore the best of clothes, $500 to
    $1,000 western boots, gold rings on all your fingers, gold
    watches, bracelets on your wrist, new trucks all the time, all
    chromed out, and you had new Lincolns and Cadillacs, Lexuses.
    What more would you need to see to know that this was the way
    of life that you wanted, all the Travelers telling you camp
    fire stories on how much money they had made on some old mark
    they had found somewhere out in the country and how easy it was
    to take them for their money.
        Most Travelers when I was a kid would stay in a town for
    about a week or two, then move to another town as soon as they
    worked the area or did a real good job where they made a couple
    thousand dollars and were scared it might draw a little heat.
    So the Travelers' kids never had time for school. They learned
    that the only way to make a living was to lie, cheat, and scam.
        Most of your Travelers today are all home owners with homes
    that range from $70,000 to $500,000. They stay in one place
    longer, have their kids in school part of the time, and have
    businesses such as car lots, blacktop paving, RV sales, and
    septic tank pumping. When things slow down and the money isn't
    coming in every day, they will start tripping off, away from
    the house to other States and scam for money from the senior
    citizens.
        You can always spot a Traveler by his outfit, known as his
    truck. Most of them like fancy 1-ton's with fancy wheels and
    tinted windows, with the front plate off so you can't tell
    where he is from. They don't like older vehicles because they
    can't depend on them. When it is time to leave town, they want
    something dependable that will get them out real fast. Some of
    the Travelers like to put magnets on their license plates, so
    all they have to do is pull the plate off. When they get a job,
    they tell the senior citizens that they just bought the truck
    and haven't had time to put plates on it.
        Most of the Traveler girls are very beautiful women, and
    when it is time for them to marry, the fathers hook them up
    with good Travelers or ``hummiechill'' boys who will be good
    providers and will take care of her in the way that she is
    accustomed.
        Traveler girls are also sold to their husbands, and
    sometimes that is a very large sum, $20,000 to $30,000 if she
    is a good hustler and can make money every day. They do all
    kinds of scams but mostly shoplifting or conning old men out of
    hundreds of even thousands by playing with their hearts.
        The reason the elderly are a good target is because they
    are very trustworthy. They are very lonely and want someone to
    talk to. They also save their money more than younger people.
    The elderly like their house in good shape because of all the
    good memories they have with their family there. The main
    target of the Travelers is an elderly person who lives alone.
    There is no one they can confide to, so they are very easy to
    trick.
        When a Traveler or myself works for an elderly person, we
    try to quickly learn as much as we can about their lives. One
    way is by asking about their yard: ``Who does your yard work
    for you?'' ``You have a beautiful yard.'' They will tell you
    anything and everything about how they have to do it
    themselves, how their kids moved away, and how this new
    generation doesn't want to work and how lazy the kids are
    today. When you ask that one question, they usually tell it
    all.
        Fake IDs are a must when you do this kind of work because
    if you get caught scamming somebody out of their money, you
    don't want to bring heat on your real name. Nothing like a good
    piece of ID with a different name. Almost all of your Travelers
    have good driver's license numbers under a fake name. That is a
    very important tool. I myself had as many as 60 aliases, and
    once I used an alias just to get out of jail. When I got pulled
    over by the police, they would run a check on the alias. It
    would come back clean, and they would let me go. The aliases
    are very important, and I would use them more than my own name.
        The Travelers could make anywhere from $50,000 to $500,000
    a year, depending on how good he was. I know of a Traveler that
    got $50,000 from one mark in one day and probably about
    $250,000 in a year's time off the same mark. The most I ever
    made in one day on a job was about $8,400. I remember a lot of
    $2,000 days, and there were days I never made a cent. I am not
    sure what I made in a year's time, but if I was to guess, I
    would say probably $60,000 or $70,000 a year. I was too busy
    spending it to keep an account of it.
        There are many Traveler scams floating around the country,
    and when one gets burnt, they think of new ones to do. My
    favorite was getting into attics and spraying for termites. I
    would take an old piece of wood with me and put bugs in it. I
    would then show it to them and tell them that the wood came
    from their attic and that I could fix the problem by spraying
    and they could save a lot of money. Over the years, I have been
    involved in all kinds of scams: blacktop paving, blacktop seal
    coating, roofing, home repair, septic tank pumping, tree
    trimming, yard care, and pest control. There are probably a few
    more, but these are my favorite and the most common ones that
    the Travelers do to the senior citizens.
        What I would suggest to all senior citizens is to never
    hire anyone to do work for you that shows up on your doorstep.
    They are there to steal your money. They don't care about you
    at all. All they want is your money. Another thing I would
    suggest is to buy a few toys and lay them around in your front
    yard so it doesn't look like an old person lives there, like a
    tricycle or a swing set, a basketball or Tonka toys. Just a
    couple of these is enough to throw a Traveler off.
        Never have anything done on the spur of the moment. I
    suggest calling up friends, family, police, or your sheriff's
    office and ask them what they think. Never let anyone talk you
    into anything. If it sounds too good to be true, that is
    because it isn't true. Nothing is for free. Travelers don't get
    rich doing stuff for free. They get rich by the kindness and by
    you trusting them.
        [The prepared statement of Mr. White follows:]
        [GRAPHIC] [TIFF OMITTED] 80873.012

        [GRAPHIC] [TIFF OMITTED] 80873.013

        [GRAPHIC] [TIFF OMITTED] 80873.014

        The Chairman. Thank you, Mr. White, for your statement.
        Next we are going to hear from a retired detective of the
    Los Angeles Police Department and their Elder Person's Estate
    Unit, Mr. Cesario ``Chayo'' Reyes.

     STATEMENT OF CESARIO ``CHAYO'' REYES, RETIRED DETECTIVE, LOS
    ANGELES POLICE DEPARTMENT, ELDER PERSONS ESTATE UNIT, CURRENTLY
           ELDER FINANCIAL PROTECTIVE SERVICES, CERRITOS, CA

        Mr. Reyes. Again, thank you, Mr. Chairman. My name is
    Chayo, and I am a retired detective from the Los Angeles Police
    Department, and developed the Department's first Elder Estate
    Unit back in 1987. I am also a co-founder of the Los Angeles
    County Financial Abuse Specialist Team, and co-authored, along
    with Los Angeles attorney Marc Hankin and my former partner
    Dave Harned, California Senate Bill 1742, enacted in January
    2001, which enables investigators to secure the assets of
    vulnerable elder and dependent adults during the course of a
    criminal investigation in order to prevent further losses. I
    have remained active in this field as a consultant and
    instructor, and currently on the Board of Directors for the
    National Committee for the Prevention of Elder Abuse here in
    Washington, DC.
        Ever since vulnerable elders and dependent adults have had
    assets, there have been individuals to financially exploit
    them. Our elders are the fastest-growing segment of our
    society, and they are also the financial backbone of our
    country's economy. They are living longer. I should say ``we''
    are living longer, and saving more than ever before. But we as
    a society do not always recognize this population as being at
    risk. There are a number of circumstances that put an elderly
    person at risk. There are physical and mental health issues
    such as stroke, Alzheimer's, depression, isolationism and other
    causes still exist in spite of our best efforts to protect our
    seniors.
        Throughout my 15 years in working elder abuse cases, there
    has been a common theme. The victims generally live alone, may
    be in poor health, and in 95 percent of our cases, suffer from
    diminished mental capacity. These conditions make them at risk
    to exploitation through undue influence or duress. They are
    easily swayed and are likely to place their entire estate in
    the control of befriending suspects.
        It was not until medical experts such as Dr. Margaret
    Singer of Berkeley, CA shed light in the phenomenon of undue
    influence were we able to begin to understand how this all
    happens. Undue influence is when people use their role in power
    to exploit the trust, dependency and fears of an individual to
    gain control over the decisionmaking of that person. Training
    from medical experts in the field of undue influence is
    paramount for investigators of elder abuse cases.
        The most common suspects I have come across have been
    family members, in-home care providers, friends and neighbors,
    but anyone in a position of trust who can exert undue influence
    over a vulnerable person. It may be a fellow church member,
    attorneys, accountants, befriending strangers, ex-con
    caretakers and predators who specifically target the elderly.
    It is troubling to conclude that if there is an endless list of
    silent culprits. There is also an endless list of silent
    victims.
        The suspects often isolate and/or will relocate the victim
    in order to obtain complete control. The suspects then create
    what my former partner, Dave Harned, and I refer as a civil
    mirage, by coercing the victims into signing powers-of-
    attorneys, contracts, quit-claim deeds, wills, living trusts,
    and adding their names onto the victims' bank accounts and
    obtaining numerous credit cards under the victim's name. In
    some cases the suspects marry the vulnerable elder as another
    means of obtaining total control of their estate through
    community property.
        Once in so-called legal control of the estate, the suspects
    operate as though they have a license to steal. They withdraw
    the victim's life savings, obtain loans on the property, making
    it subject to foreclosure, and max out the credit cards. They
    may even file bankruptcy to conceal the theft.
        Ultimately, the elder becomes a double victim, first, by
    not having the benefit of their assets which were depleted by
    the suspect, and second, the victim is responsible for any
    accumulated debt and tax penalties.
        Most people who discover or suspect these matters, and that
    includes social workers, law enforcement and prosecutors, often
    do not have the training or experience in gathering evidence to
    support the allegation. They too often assume that the
    documents show the suspect had legal access to the elder's
    estate. For these reasons many reporting person are
    automatically misinformed by authorities that it is a civil
    matter, when in fact they are hidden and silent crimes. It is
    imperative that anyone in the position or recognizing elder
    abuse or exploitation be given specific training so they can
    adequately protect our vulnerable population.
        Due to the victim's age and poor health and the suspects'
    ability to quickly deplete the estate, timely preliminary
    investigations and court proceedings are extremely critical.
    Unlike other financial crime victims, these victims are not
    able to financially, and many times emotionally, recover. As a
    result of being swindled, the victim may go into depression and
    ultimately suffer from a condition known as self neglect. They
    start out as productive, self-sufficient citizens and
    ultimately end up relying on government and/or family aid for
    the rest of their lives. Financial abuse is also related to
    more elder homicides and suicides.
        Our mission at LAPD was to network with multiple government
    and private organizations in order to maximize resources and
    utilize experts from different fields in an effort to pro-
    actively put a halt to the exploitation, while at the same time
    address the elders' long-term needs to prevent them from
    falling victim again.
        From 1987 through 1999, along with members from the Los
    Angeles County Area Agency on Aging Financial Abuse Specialist
    Team or FAST, our unit prevented the loss of and/or recovered
    over $91 million in victims' assets, which includes homes,
    vehicles and life savings. This figure only reflects LAPD
    cases. It does not include the millions of losses prevented or
    recovered while networking with law enforcement agencies across
    the country. The LA FAST team was the first in the country,
    established in 1993 and is coordinated by WISE Senior Services
    in Santa Monica, CA.
        With the growing elder/dependent adult population, the
    abuse of this vulnerable population will continue to be a
    growing problem and major concern for social workers, law
    enforcement, prosecutors, financial institutions and health
    care providers.
        There is a nationwide lack of training, expertise and
    resources to properly investigate, prosecute and litigate these
    cases. For example, most states lack legislation to address
    consent by victims who may be subject to undue influence or
    duress.
        It is imperative that such matters involving victims
    suffering from dementia, subject to undue influence or duress
    be handled with the same attention, sensitivity and resources
    given to juvenile and domestic violence crime victims.
        This hearing, Mr. Chairman, it is a very important step to
    protect and serve those who have taken care of us, and I thank
    you for having me here today, sir.
        [The prepared statement of Mr. Reyes follows:]
        [GRAPHIC] [TIFF OMITTED] 80873.015

        [GRAPHIC] [TIFF OMITTED] 80873.016

        [GRAPHIC] [TIFF OMITTED] 80873.017

        The Chairman. Thank you very much, Mr. Reyes.
        We now will conclude and very honored to have the Attorney
    General of the State of Delaware with us, whose office did such
    good work on behalf of our first witness, Ms. Gingerich, when
    she testified, Ms. Jane Brady, Ms. Attorney General.

     STATEMENT OF JANE BRADY, ATTORNEY GENERAL, STATE OF DELAWARE,
                             WILMINGTON, DE

        Ms. Brady. Thank you, sir, and thank you for hosting this
    event and this hearing and for looking at this issue.
        It is a very, very secret and private crime that occurs,
    and we are glad to help shed some light on it. I do serve as
    the Attorney General of Delaware, and Delaware is one of three
    states in the country where the Attorney General is also the
    DA, so I actually handle the cases within my office of criminal
    acts against the seniors.
        This issue is a personal one for me. I moved in to help my
    grandmother for a few days when my grandfather died, and ended
    up staying 7 years and caring for her until just a few months
    before her death, and in that time we were the victims of a
    not-leaky-roof fix by some people who were Traveler scam
    artists while I was at work one day.
        She developed Alzheimer's and I understood what it meant to
    lose confidence in your capacity to manage your affairs, and
    she lost a son, and I understood what it meant to be isolated
    emotionally for her, and to try and help her with those things.
    So I think I have an appreciation personally of some of the
    issues our seniors face.
        Every state has a Medicaid Fraud Control Unit that has
    responsibility, in addition to any Medicaid fraud, to
    investigating patient abuse and neglect, and so we actually
    have some resources in the states to look at people who are
    residents in facilities receiving Medicare funds, but there
    really is no dedicated resource for the investigation,
    detection and prosecution of crimes against seniors who live in
    the community. One of the first things I did when I became
    Attorney General was seek Victim of Crime Act money, VOCA
    funds, to help hire Mr. Johnson, about whom you have heard and
    two others, into my office to investigate and work as a liaison
    with law enforcement for crimes against seniors. I have to say
    that I was not involved in Ms Gingerich's case during the time
    that it was pending, I was made aware of it after it had been
    resolved, but the program worked exactly as I had hoped,
    because we had a trained and dedicated law enforcement
    professional, and the people I hired into this job were retired
    police officers to liaison with the police. Mr. Johnson had
    worked at Troop 3, which is why when he made the phone call,
    Troop 3 came out to Ms. Gingerich's home.
        They liaison with law enforcement. They make sure they know
    about the social service agencies that are available and they
    coordinate the delivery of services on a very comprehensive
    basis to the seniors who are victims of crime in the community.
        With regard to financial exploitation, that most often
    happens in the community, and some of the stories you have
    heard today are unfortunately played out over and over in our
    country, day after day. Particularly, you saw the emotion
    during the press conference and during some of this testimony.
    That is because the people who victimize seniors in financial
    exploitation most largely either have a long-term relationship
    or have developed a relationship of trust that is breached.
    They question their judgment. They worry for fear of reporting
    it that they will lose confidence of their other family members
    in their ability to manage their affairs. They worry that they
    will be taken from their home and placed in a facility if they
    report the crime, and there are huge emotional issues tied to
    financial exploitation for the victims of those crimes that we
    cannot underestimate because it is part of the reason that you
    only see 16 percent of them, because people are embarrassed and
    they are afraid they will lose their independence if they
    report them.
        Let me talk about the police officer's response, or law
    enforcement responding. One of the problems is--and Chayo
    touched on this a little bit--is that in most cases involving
    dispute over who owns a piece of property, who had the right to
    write a check, who has the right to exercise the power of
    attorney and under what circumstances, most of the kinds of
    cases involving financial exploitation, whether there is rent
    owed, are related to matters that between any two other parties
    would be referred to a civil court. So it takes the training
    and attention to those specific facts relative to the financial
    exploitation of the elderly to take it out of the context out
    of if it were anyone else and put it into the context of the
    reality, that it is not just anyone else. It is someone with
    whom a person had responsibility, who had entrusted
    responsibility in care of their resources and assets. So it is
    one of the reasons law enforcement I think has been reluctant
    historically to become involved.
        I appreciate the opportunity also to talk about some of the
    things that we either can do or have done in Delaware, and we
    have not done everything, believe me, but we have worked really
    hard on this issue, because as I said, it is personal to me.
        I have brought a number of materials that are outside. Some
    of the brochures that we have developed to help with public
    education on financial abuse of the elderly, investment scams.
    We hold consumer universities and investment education
    seminars. We have developed a program for volunteer senior
    advocates. I handled a rape case in 1979 involving a 73-year-
    old rape victim, who said to me, when I told her I understood
    something about her story, said, ``You know, you are a very
    nice young lady, but you have no idea what I am going
    through.'' I brought senior peer advocates trained--we
    specially train them to work with seniors who are victims. They
    go out with Mr. Johnson and his peers into the community to the
    interviews. They are somebody that provides a little extra
    phone contact, sits with and accompanies these victims to court
    to make them feel more comfortable, one way to expand our
    resources without costing a lot of money.
        The other is we have a senior volunteer program. We are
    replicating one that Joe Hynes, the DA in Brooklyn has, where
    he has retired senior attorneys take the cases at the Grand
    Jury level for senior victims of crime, and provide extras
    services and a little better understanding for them of what the
    process is.
        We have put together a Senior Victim Task Force and brought
    everything from Meals on Wheels, who are great eyes and ears in
    the community on what is happening in the homes of seniors who
    are victims of crime, to the government agencies like Adult
    Protective Services, Division of Aging, the bank commissioner,
    private nonprofits that work for seniors, ER physicians, and
    put them all at the same table. We are developing a report. Law
    enforcement developed a model policy on how to respond to
    crimes involving seniors in their communities.
        Delaware has been fortunate. We have actually the
    Clearinghouse for the Abuse and Neglect of the Elderly for the
    country located at the University of Delaware. Karen Stein runs
    that, and it is a resource of information. They responded to
    nearly 300 inquiries last year for resources, journals and
    documents and things that have been done or relating to
    information about the abuse and the neglect of the elderly,
    which I think would be a great compliment to what you are doing
    with the training information, the training resources you want
    to provide.
        We also have adopted some good laws that help us, and we
    have revamped our home improvement laws and some of our
    mortgage laws, and our door-to-door sales laws and our
    charitable solicitation laws, to make them better. We have
    provided enhanced penalties for crimes when seniors are the
    victims of those offenses. We have, I think, one of the few
    laws in the country relating to emotional abuse of seniors and
    infirm adults, and we have a law that allows a hearsay
    exception in proving cases in court for seniors and infirm
    adults, also dealing with the mentally disabled. We have
    actually had one case where the victim never went to the
    courthouse, and we got a conviction.
        So those are the kinds of things we are doing. I think that
    this is the most secret of crimes, as I said, the kind of
    physical violence that occurs in the homes of some of these
    seniors is the most secret kind and hidden kind of domestic
    violence that there is.
        I appreciate the opportunity and the wonderful work that
    this committee has undertaken to try and help raise the
    national awareness, the professional expertise, and the
    integrity with which we look at these cases.
        [The prepared statement of Ms. Brady follows:]
        [GRAPHIC] [TIFF OMITTED] 80873.018

        [GRAPHIC] [TIFF OMITTED] 80873.019

        The Chairman. Well, thank you, Madam Attorney General, and
    obviously, Delaware is a real leader in this effort through
    your efforts, and we congratulate you for what you have done.
        I think that I want to particularly thank every one of the
    members of the panel who have been with us all afternoon, and
    many have come from long distances to present their stories. I
    think that what we have heard today, that a crime can be
    committed with a pencil as well as with a gun. It depends on
    the type of activity, but it is still a crime, whether it is
    with a pencil or a gun or by some other type of scam that is
    perpetrated on people who are very vulnerable.
        Ms. Gingerich, yours was a roof. How did you figure out
    that something was wrong, that these people were not really
    honest, what they were doing to you?
        Ms. Gingerich. Well, I do not know. I did not really figure
    it out. I just--well, it was a lot of money and I just did not
    say anything to my kids and my husband. I was talking with my
    sister, that is when it all started.
        The Chairman. I guess because of the efforts of the
    Delaware Attorney General's Office, I forgot--were these people
    prosecuted, or they gave you your money back?
        Ms. Gingerich. Yes.
        The Chairman. Do you know if they were prosecuted, Ms.
    Brady, do you know, Attorney General?
        Ms. Brady. They paid her back everything including no
    compensation for the work they had done, in lieu of prosecution
    in this particular case. One of them was, however, arrested and
    taken into custody because he was wanted out of the State of
    Florida for other crimes.
        The Chairman. Were they part of a pattern? This was not
    their first effort in this type of endeavor I take it?
        Ms. Brady. No. We do see them come through. As I say in
    1977, 1978 my grandmother was the victim of the same kind of
    thing, a roof, tar on the roof, not driveway sealer that time,
    but just goop on the roof.
        The Chairman. Well, Ms. Gingerich, we thank you very much.
    Do not feel bad about what happened to you. I mean do not blame
    yourself, because there are specialists out there that try to
    do that to an awful lot of people in your situation, so you
    should not feel bad. They were real professionals in what they
    were trying to do.
        Mr. Blevins, your story, thank goodness you were there for
    your 72-year-old cousin. I was really interested. Was there no
    other family there; I guess you were sort of it, or was not in
    a position to help or did not?
        Mr. Blevins. Vaughan's parents died in the late 1980's
    about 9 months apart, and we check on Vaughan. You have to
    remember he and his family was a very private, reclusive family
    and people that lived in a remote area, somewhat remote area of
    Fairfax County, a rural area. We checked on him from time to
    time, and to be honest, I feel terrible that I did not get an
    eye awakener at some point in time earlier.
        The Chairman. I think the most astounding thing that I got
    from your testimony, that when you first went to, I guess, the
    local police I guess in Fairfax County, that someone said to
    you, in essence, that it was not a crime for people to give
    their money away.
        Mr. Blevins. That is exactly what I was told. I just could
    not believe what I was hearing, to be honest about it.
        The Chairman. You were talking about the information that
    we need to get out there, and the training that we need to get
    to law enforcement officials. It is not a crime to give your
    money away, but if you are scammed out of it, it is a crime,
    and it is just like if you had a gun pointed at you, what they
    were doing to--Mr. Henderson was doing to your cousin.
        Mr. Blevins. We are talking about a person here with
    diminished capacity, who cannot reason with that particular
    line of thinking anyway. That logic means nothing to him or
    her.
        I would like to point out that in the past Mr. Henderson
    has run his various scams, et cetera. He took advantage of
    lawyers in the past. Two sitting judges in Northern Virginia
    were duped by Mr. Henderson in the past.
        The Chairman. Henderson must have been quite a character.
    He was a real pro, was he not, at this?
        Mr. Blevins. We are talking, and two members of a local
    city council, and I think a vice mayor, and members of a
    historical society. So when you look at that, the people, with
    elderly and the people with diminished capacity, did they
    really stand a chance with Mr. Larry Henderson?
        The Chairman. What did he pose as? What was his come-on to
    your cousin and others?
        Mr. Blevins. He developed a friendship with my cousin in
    the local--I have several eyewitness accounts and written
    accounts, where he would have these little coffee circles like
    at McDonald's or a drugstore, a little dairy bar or something
    of that nature, little meeting at hardware stores. There was 5.
    He got victims at every one of them.
        The Chairman. But he was not trying to sell anything to
    them. He was just becoming a friend and then getting money from
    them.
        Mr. Blevins. Isolating, studying his victim, and then he
    would maybe pick a victim out. Maybe he would not even cozy up
    to them at that point in time. Then he would find out where
    they live or reside or whatever. Then he would often go door-
    to-door and solicit his home improvement services. This was his
    usually main avenue to these people.
        The Chairman. Was that what he did to your cousin? Did he
    try to sell him services or what?
        Mr. Blevins. He did solicit, I was told one time, at his
    residence for home improvement repairs, yes.
        The Chairman. Well, thank you very much for telling us his
    story.
        Mr. Graham, as I said, the work that you did, the
    congratulations for performing the services that you did. I
    mean the conditions that that 81-year-old women was required to
    live in are just almost unbelievable. You think about something
    like that happening in America, you cannot imagine it happening
    anywhere in the world, but particularly in our country, that
    that was something that was so shocking. I mean the daughter,
    what was her problem? Was this woman a person who had any sense
    of being a human?
        Mr. Graham. She did. She said that is the way her mother
    wanted to live.
        The Chairman. Was she determined to be capable mentally to
    stand trial? Did she know what she was doing?
        Mr. Graham. She was found competent to stand trial, and a
    week ago a jury convicted her of both counts, criminal
    mistreatment and abandonment of a dependent adult. She awaits
    sentencing at the end of this month.
        The Chairman. Just out of curiosity, it sounds like a very
    technical thing, statute that she was tried under, criminal
    mistreatment of a dependent person and abandonment of a
    dependent person. To me it looked like this was a crime as
    violent as anything you can imagine. What is the potential
    sentencing for this? Is this a felony?
        Mr. Graham. It is a felony. It is a low-grade felony.
    Sadly, the standard sentencing range for this is 12 to 14
    months.
        The Chairman. This woman was killing that woman just as if
    she had taken a pistol and shot her, but it was probably much
    worse because it was gradual.
        Mr. Graham. We believe that she was trying to crawl out of
    there, and that is when the fall took place. Had that not
    happened, she most likely would have died in that residence.
        The Chairman. How old was the daughter?
        Mr. Graham. 42-years-old, sir.
        The Chairman. Did she have a family?
        Mr. Graham. She has a daughter and grandchildren of her
    own, and there were 3 adult male sons of the victim, who have
    moved out of the area. No one else in the family has had
    contact with the victim in years.
        The Chairman. That is, I mean we have had some tragic
    stories, and this is right up there with absolutely the worst
    that I have ever heard. It just shows you that this is, as I
    think Madam Attorney General mentioned in her statement early
    on, a silent crime in many cases.
        Mr. Graham. Right under our noses.
        The Chairman. How long had this been going on, maybe not to
    that extent; how long had this problem been in the condition
    that you found it in?
        Mr. Graham. In talking to neighbors and canvassing the
    neighborhood, nobody around her had seen or heard of her in
    years.
        The Chairman. Even next-door neighbors?
        Mr. Graham. Even the next-door neighbor. A gentleman across
    the street had indicated to us that he could not remember ever
    seeing a light on in this house.
        The Chairman. Well, this is just a horrible, horrible
    story, but the committee thanks you very much, Detective, for
    coming and sharing it, because it is only by making these type
    of silent crimes, if you will, public can we get the Congress
    and all of us to be involved in trying to find a solution. One
    of the press questions was why has it taken so long? I do not
    really have a good answer for that, but perhaps the public has
    not understood it. To the extent that we are now understanding
    it in the year 2002 and your story, and all of your stories
    certainly have contributed to making that case, as to the
    necessity of doing something about this. I mean we are very
    glad that you all were informed and took action. Two-thousand
    offenses you said reported?
        Mr. Graham. Yes, sir.
        The Chairman. Against elderly?
        Mr. Graham. Against people aged 63 and older.
        The Chairman. That is just in Tacoma?
        Mr. Graham. That is just our city.
        The Chairman. All right, Mr. White. We are glad to have you
    here. What is, if you can tell me, what are the Travelers? You
    used the term ``Travelers.'' What does that refer to?
        Mr. White. Well, what they are is they are American Gypsy,
    a lot of them. You have got some clans that are Scottish, and
    then you have got some of your Irish Travelers, and then you
    have got your regular American Travelers, and they just live
    here in the United States and travel around the United States.
        The Chairman. I said in my opening statement that we are
    not trying to indict all Travelers or Roamers or whatever term
    we use, but is there a large percentage of Travelers, in your
    opinion, that are engaged in the type of activities that you
    described?
        Mr. White. Why sure, there are thousands, I would say
    probably around 50,000.
        The Chairman. Of the ones that you knew, what percentage of
    them were engaged in the type of activities that you talked
    about, all of them, half of them?
        Mr. White. A good half of them.
        The Chairman. This is all you ever learned, was it not?
        Mr. White. Yes. Ever since I was a little kid, I have seen
    it all. I was brought up into it.
        The Chairman. Where did you learn it from?
        Mr. White. From my family mostly, my uncles, father, and
    cousins.
        The Chairman. Are you the first one in your family to be
    convicted of this type of activity?
        Mr. White. Yes.
        The Chairman. Are the rest of the ones that you associated
    with still doing their work?
        Mr. White. Yes, pretty much so. There are a lot of them,
    they got real businesses now that they work at, and then in the
    wintertime they take off and go out and do their scamming in
    home and repair work.
        The Chairman. Is there any type of activity that is done
    more than other type of activities? Is it repair work, I mean
    is that the basic?
        Mr. White. Yes. Repair work is mostly what is done. Usually
    the roof, a lot of them, they like to do roof work, driveways.
    But the roofing and the driveways is probably the biggest part
    of their scams.
        The Chairman. Did you all do enough to make it look like it
    was a normal job, or you just got the money and took off?
        Mr. White. Well, we would do enough on a job, and we kind
    of played a role like you were playing in a movie or something.
    You know, everybody had their own little part. You had your guy
    up on the roof. You had the guy inside the house, talking to
    the elderly, finding out what he could in information, and find
    out where the family was at, find out about how well they were
    financially wise. Then they would go ahead and go in there and
    charge a big amount of money, sometimes 4 or $5,000, and if
    they had seen that the money was easy to get in these cases
    down here, well, then they would go back. Well, that is too
    good to pass up. They would go back again and do it again. Then
    if it was really good that time, well, then they might start
    buddying up and being friendly and taking them out to eat, and
    the next thing you know, they are signing over houses and
    putting their name on accounts.
        The Chairman. You were convicted of what, Mr. White?
        Mr. White. I was convicted of grand theft. What my charge
    was, I was doing pest control work, and what I was doing is I
    was knocking on the doors, getting the elderly to the door and
    explaining to them that they had shingles out and they need to
    get them put in, and I had shingles that I could put in there
    if they would want it done. I would do it for free. I was
    around the corner putting on a new roof, and I was just
    finishing up, and if they wanted it, well, I would do it for
    free.
        The Chairman. You never finished high school?
        Mr. White. No, sir.
        The Chairman. You ever went to grammar school?
        Mr. White. No, sir.
        The Chairman. In a way you are a victim, are you not?
        Mr. White. Well, yeah, you might put it that way.
        The Chairman. Well, we appreciate you being here. I mean
    obviously you have done a great deal of damage to a large
    number of people, but hopefully your story can help enlighten a
    lot of people about the problems that are out there and for
    that we thank you for being with us.
        Mr. Reyes, I was interested in one of your comments about
    some of the law enforcement think that this is a civil matter,
    and the State's Attorney General also spoke to that same
    problem. Like I said it is theft with a pencil, but just as
    violent as a theft--I mean theft with a pencil is just as
    violent as theft with a gun. But a lot of people think that
    well it is just a civil matter because they did not use a
    pistol. This is sort of a scam, but it is not a crime, and go
    sue them for it. Is that--I guess that in itself is a problem
    because a lot of law enforcement people do not want to get
    involved.
        Mr. Reyes. It is true. Part of the problem is the way we
    are all trained because some of the elements of theft is to
    permanently deprive. Well, how do you permanently deprive when
    you have documents that show the suspect has legal access to
    everything, you see? The other part is, then who do we have to
    report the crime? Any of us in here, when we are victimized of
    a theft, we can report the elements regarding it, but what has
    been discussed here is we are talking about vulnerable elders
    or dependent adults, where because their own financial
    situation, house situation, their living conditions, well, they
    become vulnerable, and the suspects take the time to give that
    extra attention to them to explore, to find out what that
    situation is, the way Mr. White explained here, and use it to
    their advantage, and that is when they start finding out the
    likes, dislikes and start tapping into their heart, their
    feelings. The devastating side effect of this, Senator, Mr.
    Chairman, is that it is not only a theft that takes place, but
    because of that close relationship that is established in some
    of these cases, they feel as if it was their own daughter or
    son, someone that close that committed the theft from them.
        The Chairman. It is a personal thing as well.
        Mr. Reyes. Pardon me, sir?
        The Chairman. It is a personal involvement that causes
    problems in addition just to the loss of the money.
        Mr. Reyes. Right. So along with the pencil part, it is who
    has that pencil versus the gun? It is someone that they have
    that close relationship with.
        We have one suspect who was Hispanic and he was Catholic,
    and he got so close to his mark, his victim, that he changed
    faiths. He changed his last name, and became Jewish. He would
    accompany the victim to the synagogue for services, everything,
    and then hit him hard, hit him hard financially, and that was
    very devastating for the victim.
        The Chairman. You really make the point very well. I kept
    saying to Ms. Gingerich, do not feel bad about being a victim
    because there are literally thousands of people. I think people
    are sort of embarrassed by feeling that someone has scammed
    them out of perhaps their life savings, and they hesitate to
    report it, and they just say, you know, I should not have been
    that dumb, when they really were not, because they were being
    taken advantage of by a professional who in many cases, like
    this Mr. Henderson, was very good at what he did.
        Madam Attorney General, I guess the question for you, we
    talked about trying to outline what our legislation, the Elder
    Justice Act of 2002 was going to do, was to try to put into the
    Health and Human Services Administration and within the
    Department of Justice agencies that would be directing their
    activities at elder abuse, and one from the standpoint of
    defining it and from a health standpoint in the Health
    Department and the other from a prosecution standpoint in the
    Department of Justice. Do you think there is a legitimate role?
    Can you maybe comment on that, for Federal Government to play,
    or do we just let the states do it on their own?
        Ms. Brady. Well, I have to say that I generally believe
    that prosecution of crime belongs with the local jurisdictions,
    and firmly committed to that principle.
        I do believe that historically and also approximately, the
    Federal Government has a role with regard to research and
    development, technology support, training support, and in those
    roles I see the Federal Government as having a very legitimate
    and important role that it could play.
        I think that while I was able to get VOCA funds and made
    that a priority for me in developing the Elder Abuse and
    Exploitation Project within my office, there are many DA's
    offices that do not have access to as much of the VOCA money as
    I do because I am a statewide jurisdictional office and they
    are local county jurisdictional offices. So I think providing
    training through, even through the NDAA and the American
    Prosecutors Research Institute would be a wonderful way to
    assure that they get trained.
        I think too that there is a good avenue for training for
    law enforcement, and we have talked about that, but I do not
    think you can leave the prosecutors out of it. It is important
    that they have an understanding of the special emotional needs
    of these particular victims. The proof issues with regard to
    their ability to recall and relate events. We often, in a case
    involving a very elderly individual who is not mentally capable
    and may be incompetent to testify as a witness, have to
    evaluate the case much like we would a very young child who has
    never learned to speak, in terms of what we can prove, whether
    we can prove the elements, how we can use creativity to
    establish the elements of the crime, and portray a sense of the
    loss of the victim without the victim necessarily being a
    participant in the case.
        The Chairman. Well, that is exactly what we are
    envisioning, not to have Federal prosecution, but maybe a
    Federal information library and technical resources and
    training, so that people out there will know exactly what we
    are tackling here and what the challenge is and not to take
    over the prosecutions, but in order to better allow information
    to flow and funds to flow to the local jurisdictions to take
    whatever steps are necessary.
        I want to thank each and every one of you individually for
    being with us. Each one of you has made a unique and I think a
    very, very special contribution to this panel this afternoon. I
    want to thank the U.S. Marshals for their cooperation in
    providing Mr. White being with us, and for his statement as
    well. But each one of you had a very unique perspective on this
    and you have really clearly told a story, and that story needs
    to be heard by everyone in this country, and certainly everyone
    in this Congress in order to do more than just have another
    hearing.
        I pledge my total support to getting this done and not just
    having another hearing for the sake of a hearing, and you all
    can know that you all have made a major contribution in helping
    us reach that goal.
        With that, this committee will stand adjourned.
        [Whereupon, at 3:46 p.m., the committee was adjourned.]
                                A P P E N D I X

                                  ----------

      Statement of Thomas W. Richardson, Acting Deputy Assistant Director
                        Federal Bureau of Investigation

        Good Morning Mr. Chairman and Members on the Committee of
    Aging. I am pleased to appear today on behalf of the Federal
    Bureau of Investigation and share with your committee a brief
    overview of what are referred to as ``transient'' or
    ``nomadic'' criminals. The two groups that your committee
    especially requested be addressed are the ``Travelers'' and the
    ``Gypsies.''
        First of all, I would be remiss if I did not stress from
    the onset that there are no law enforcement  agencies  alleging
     or implying  that all  or even  a majority of either of these
    groups are criminals. Historically both groups have endured
    centuries of prejudices and persecution. In fact, the Gypsy
    race was targeted by Adolph Hitler for genocide. However, there
    are criminal enterprises have a preference for certain types of
    criminal activities. The criminal elements within the traveler
    groups and Gypsy  groups participate  in a  variety of
    fraudulent  schemes  to include  ones that target the elderly.
        The information I am providing was developed through a
    review of FBI investigative efforts, queries of other law
    enforcement agencies and from insurance investigators. Most of
    the FBI's investigative efforts concerning this crime problem
    has relied heavily on assistance from other law enforcement
    officials, particularly local and state, who have more
    extensive experience in crimes involving members of these
    transient criminal enterprises.
        The Travelers are an ethnic group whereas the United
    Nations recognizes the Gypsies as a race. The Travelers
    consists of three subgroups, the English Travelers, the
    Scottish Travelers and the Irish Travelers.\1\
    ---------------------------------------------------------------------------
        \1\ Source` ``Criminal and Consumer Fraud Activity of Nomadic
    Groups,'' South Carolina Department of Public Safety Booklet, April
    1995.
    ---------------------------------------------------------------------------
        Although, one Chicago tribune article alluded to a fourth
    group called Welsh Travelers.\2\
    ---------------------------------------------------------------------------
        \2\ Chicago Tribune Tempo, ``The highway is their home,'' March 17,
    2000.
    ---------------------------------------------------------------------------
        The majority of the traveler groups migrated to the United
    States in the mid to late 19th Century from the British Isles
    and are labeled according to ethnic background.
        The Gypsies have two subgroups, both of which operate in
    the United States. These are the American Gypsies, the majority
    of whom immigrated to the United States in the late 18
    hundreds, and the European Gypsies, who have been in North
    America for 30 years or less. The 1984 changes in the Canadian
    Refugee program resulted in an influx of Gypsies through
    Canada, particularly from Poland and Yugoslavia. The Anglicized
    pronunciations of the more accurate terms for Gypsies are
    ``Rahm,'' spelled ``R-O-M'' or ``Rahma,'' spelled ``R-O-M-A.''
    We were advised by a law enforcement officer, who is a Gypsy,
    that the term ``ROM'' is singular (usually for a male) and Roma
    is plural.\3\
    ---------------------------------------------------------------------------
        \3\ Source: John Nicholas, Jr., Special Deputy U.S. Marshal, Court
    Security Officer, U.S. Marshal's Service, Los Angeles, CA.
    ---------------------------------------------------------------------------
        However, among the law enforcement community the terms are
    becoming interchangeable. Consequently, I will refer to this
    group as either Rom or Gypsies.
        The Rom are believed to have originated in the Punjab
    Region of Northern India and then migrated to Europe beginning
    in the 14th Century. It is also thought they migrated through
    Egypt and, as a consequence, may have been called Gypsies as a
    form of the word ``Egyptian.''
        It is unknown how many Travelers and Rom are in the United
    States. Estimates for the Travelers range from 7,000 to as high
    as 50,000, depending on the source. The estimate for the Rom
    living in the Untied States is about 500,000, but there was
    also one estimate claiming the number could be as high as
    1,000,000. There is no accurate census data available so these
    figures are basically educated guesses.
        Some anthropologists believe that the English and Scottish
    Travelers may have Rom ancestors due to the slightly darker
    features of some members. The Rom were known to have traveled
    and settled in these regions several centuries ago. In fact,
    some the earliest Rom to migrate to America were those deported
    in the early 1700s from Scotland to Virginia. The Irish
    Travelers, on the other hand, may have predated the celts and
    are not believed to have evolved from any Rom migration into
    Ireland.
        The Travelers and Gypsies have similar cultural practices
    for example: both maintain a ``closed society'' wherein the
    family and group rules are more important than laws of the
    jurisdiction in which they live.
        Both have nomadic lifestyles. Most Travelers essentially
    are migrant workers who travel throughout the United States
    performing tasks such as painting, roofing, pressure-washing
    and home repair work. Many traveler groups have permanent
    residences, such as Murphy village in North Augusta, SC, but
    will spend between 40 and 70 percent of the time on the road.
    The traveler groups favor rural America for both legitimate and
    illegitimate work. The American Rom tend to live in or near the
    big cities. European Rom, many of whom are here illegally, are
    usually nomadic, but also favor the larger cities to travel to.
    Welfare and relief programs of the 1930s are believed to have
    been responsible for the American Rom establishing permanent
    residences in metropolitan areas. Additionally, it is easier
    for the Rom to blend into larger cities where there is
    cultural, ethnic and racial diversity.
        Both groups tend to marry within their own culture to
    include through arranged marriages. Many of the Rom women get
    married between the ages of 12 and 16.
        The Travelers and the Rom have a distinct language or
    dialect unique to each subgroup. The Gypsy language is often
    referred to as ``Romany.'' The Travelers have more Gaelic
    oriented dialects with a mixture of English and possibly some
    bastardized romany. The Travelers dialects are referred to as
    ``cant,'' ``gammon'' and ``shelta.''
        These transient cultures have patriarchal family structure
    with a male serving the head of each family or extended family.
        The family livelihood of these groups, to include criminal
    activity, is passed down among family members.
        The traveler children usually attend school for some of
    their early life, but seldom go beyond the high school level.
    The Rom, particularly the European Rom, tend to have little
    formal education.
        Those criminal enterprises within the various traveler and
    Gypsy groups participate in similar illegal activities which
    fall into, more or less, the categories of insurance fraud,
    burglary (and theft), and the one most applicable to the
    elderly, consumer fraud. Both groups typically avoid violence
    or the threat of violence.
        The goal of the insurance frauds and consumer frauds is
    usually to ``con'' rather than use a ``strong arm'' tactic.
    Both groups are aware that consumer frauds are not often a law
    enforcement priority, which reduces their risks of prosecution
    unless they aggravate a ``con'' with the use of violence or
    threats, or get too greedy. Related illegal activities that
    furthers the theft and fraud schemes include:
        Tax evasion. Travelers view themselves as U.S. citizens and
    many file tax returns, but usually understate their income. As
    a rule, the Rom do not consider themselves U.S. citizens and
    usually do not file taxes. Many of the Rom do not have
    legitimate social security numbers. Both groups prefer cash
    payments for their work, which facilitates the tax evasion.
    Many of the Rom groups, particularly the European Rom, do not
    maintain accurate records of births, marriages and deaths. They
    also avoid census efforts. Consequently, the transient nature
    and lack of accurate identification makes tracking of the
    suspected criminal elements of these groups all the more
    difficult.
        Both groups make use of fraudulent documents to include
    false identifications, Social Security numbers, date of births,
    business permits and so forth. The Travelers are known to
    practice identity theft to both elude police and effect other
    crimes.
        The Rom are known to use bribery of law enforcement
    officials to assist in getting cases dismissed or in learning
    of existing investigations.
        Travelers have impersonated government officials, such as
    posing as IRS agents to collect ``taxes'' in cash.
        Many European Rom as either illegal aliens and/or assist in
    smuggling other Rom into the United States, particularly from
    Canada.
        A known traveler scheme is to sell inferior products, such
    as travel trailers, at inflated prices with fraudulent bills of
    sale. This was particularly lucrative in the 1980s among the
    English and Scottish Travelers and appears now to be making a
    comeback.
        The Travelers are suspected of various forms of financial
    institution frauds to assist in other schemes, such as setting
    up accounts with phony names and/or addresses on a short term
    basis.
        The Rom are particularly adept at working as police
    informants in order to eliminate competition. For example, they
    may provide information on illegal fortuneteller activities of
    persons that have moved into their ``turf.''
        The insurance frauds typically are for staged accidents,
    false claims for weather damage to vehicles and trailers, and
    ``slip and fall'' scams.
        With respect to crimes involving the elderly. Older
    Americans are often targeted because they are vulnerable. The
    Travelers and Rom use salesmanship and pressure tactics to take
    advantage, particularly if it appears the victims suffer from
    any form of diminished capacity due to aging, senility or
    related ailments. Often the elderly do not know they have been
    swindled or are too embarrassed to report it. The uniform crime
    report does not have a vehicle in place to capture victims age
    date (except for murders), so it is unknown the percentage of
    elderly that comprise that portion of the population who are
    the victims of various consumer frauds. The primary crimes
    employed by the Travelers and Rom against the elderly include:
        Home repair scams wherein the transient criminals will use
    a variety of methods to approach the elderly and offer to make
    certain repairs or provide certain services. Home repair scams
    usually involve, painting, roofing, driveway projects, sealant
    type work, pest extermination or tree pruning. The work and/or
    materials used are inferior, or the work is not performed at
    all. If the victim seems particularly gullible, then the scam
    may continue over a period of time with claims of additional
    costs, telling the victim they need to collect taxes for the
    work, and so forth.
        Burglary is a common offense. Often the burglaries occur
    during home repair projects or by distracting the homeowner.
    The Rom will use Women and Children to gain access to a home
    through a ruse. The Women will distract the homeowner while
    other women and/or the children steal cash and jewelry. That
    is, they steal harder to trace items and usually try to leave
    the home undisturbed so that it may take a while for the
    victims to know they have been robbed.
        Fortuneteller scams (now referred to as ``psychic
    readings'') are commonly used against the elderly. The Rom
    manipulate clients, often by preying on any superstitions they
    may have. The concern over ``evil spirits'' is a prevalent
    theme among Gypsy fortunetellers. One scam is for the
    fortuneteller to ask for ``clean'' money to burn in a
    handkerchief and then through sleight of hand, substitute the
    original handkerchief and money for an identical handkerchief
    and paper. These are the easiest scams in many respects since
    the victim usually seeks out the psychic reader. In other
    words, the victim is predisposed to become a victim. There were
    reports of losses to single individuals in a Los Angeles case
    of nearly $500,000 and in Deland, FL of $350,000.
        Sweetheart swindles are a growing Rom favorite wherein
    young female Gypsies manipulate elderly men into providing
    money, extravagant gifts, access to bank accounts and so forth.
    These are difficult crimes to prosecute due to the victim
    frequently being ``willing'' participant. Law enforcement often
    has to be creative to find a prosecutive strategy.
        In respect to FBI cases and initiatives, there is no
    specific initiative or agenda targeting the transient criminals
    within the FBI. There have been cases opened against group
    members and there have been successful prosecutions for a
    variety of offenses. A New Orleans case resulted in the
    prosecution of two Irish Travelers, a third member is a
    fugitive, for the type of home repair fraud against the
    elderly. The Columbia, SC, office prosecuted seven members of
    the Irish Travelers for various insurance related fraud
    schemes. The Oklahoma City office helped in the prosecution of
    English Travelers who not only did a home repair scam, but
    later posed as IRS agents to obtain an additional $14,000 from
    the same elderly victims. The Newark office helped prosecute a
    Rom leader for attempting to bribe a police official. The
    Detroit FBI prosecuted a police officer and members of a Gypsy
    group for corruption and bribery. This particular Detroit case
    also helped solve a buffalo, New York, home burglary
    investigation with losses in excess of $400,000. The FBI had
    had recent cases in Omaha, Pittsburgh, Miami, Oklahoma City and
    several other cities. However, usually these types of FBI cases
    are in the smaller offices of within smaller resident agencies.
    Generally, FBI offices do not have the resources to pursue
    these scams and often do not have federal jurisdiction.
        The criminal elements of these groups are without a doubt a
    type of organized criminal enterprise usually comprised of
    family members related by blood and/or marriage. However, they
    are not typically targeted as organized crime by federal
    authorities. The overall losses to consumers are often very
    significant but the individual losses, with some exceptions,
    are comparatively small, and usually there is no violence.
    Consequently, the resources within the federal law enforcement
    community are most often devoted to other criminal enterprises
    where there are more significant monetary losses and/or the
    criminal enterprises are more prone to using violence.
        There are federal tools and statutes that have been and can
    be used to pursue the types of offenses peculiar to the
    transient criminals. These include: interstate transportation
    of stolen property, IRS violations, immigration violations,
    fraud by wire, mail fraud, unlawful flight to avoid
    prosecution, and fraudulent use of social security numbers. In
    particularly egregious circumstances, rico statutes could also
    be employed. The unlawful flight to avoid prosecution statutes
    could assist local law enforcement agencies pursuing major
    burglary cases, theft by deception matters and similar state
    law violations. Overall, Since 9-11 the FBI does not have the
    resource to pursue these groups as a national FBI initiative. A
    viable option however could be assistance to local agencies or
    as part of task forces in regions where these crimes are
    prevalent. As noted previously, in many of the FBI cases the
    matters were and are pursued jointly with other law enforcement
    entities.
        The FBI is cognizant of all the difficulties facing the
    Senate's Special Committee on Aging in protecting the elderly
    from persons who prey on them simply because they are
    vulnerable. It is hard not to feel personally outraged at
    persons who target older Americans in much the same vein as
    when persons target children. One recommendation for the
    committee would be to consider amending current sentencing
    guidelines that would include significant enhancements for
    criminal enterprises that target the elderly, or a person with
    mental or physical handicaps. California, and a few other
    states, have instituted such legislation.
        The FBI is committed to protecting all segments of society
    to the best of its abilities. However, in light of the many
    criminal enterprises, most of whom use violence and
    intimidation as part of their criminal activity, it would be
    difficult to institute a national initiative to target the
    transient criminals without more resources, particularly
    personnel, and without the assistance of other law enforcement
    agencies, both federal and state.
        Thank you.
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