[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
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                       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
    
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    [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:]
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    [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:]
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    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:]
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    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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