Generation Theft: Huge rise in fraud predicted as Baby Boomers die off

The passing of the Baby Boomer generation (those born between 1946-1964) is leading to the largest intergenerational transfer of wealth in history.

This unprecedented shift of assets has a darker side, though, with a potential sharp rise in conflicts between family members over the division of estate assets.

These disputes between potential heirs can involve accusations of fraud, forgery and wrongdoing. The claims might be genuine. Or they can come from those who feel slighted and are determined to disrupt the probate process.

As a firm that specialises in investigating and litigating asset recovery matters, we have seen a sharp increase in cases where warring family members have fought over a parent’s assets. Some of the skullduggery employed is astonishing in its breadth and brazenness.

In many families, one sibling may exploit the situation to defraud others, using tactics ranging from undue influence over an elderly parent to outright forgery of a Will.

Such inheritance fraud can take many forms, including coercing or manipulating a vulnerable elder, misusing a power of attorney, or even committing elder abuse to gain control of assets (when the elderly relative is still alive).

On two of the high-family office, succession fraud cases on which we’ve worked, the eldest sibling got hold of their late father’s holding company’s Register of Shares. In each case, the eldest sibling then issued a large number of shares to themselves – thereby substantially diluting their younger siblings’ stake in the wealth of the family.

There are obviously legal aspects to this developing problem, but these are intertwined with sociological and psychological dimensions. 

Rising incidence of elder abuse

In the United States alone, tens of trillions of dollars are expected to pass between generations in the coming years.

Baby Boomers are living longer, and many are suffering age-related cognitive impairments (such as Alzheimer’s disease) that make them vulnerable to fraud and adverse influence. The complexity only increases where there have been multiple marriages and offspring.

Current economic pressures only serve to heighten the stakes. In the UK, for example, inheritance disputes have surged in regions with high property values, as skyrocketing real estate prices have made even unexceptional homes a lucrative asset. The “Silver Economy”, as it is known, saw Boomers spend in the region of $15 trillion in 2020, up from $8 trillion in the decade prior.

The National Council on Aging estimates that elder financial abuse costs Americans $36.5 billion annually, and this figure will likely only increase. The National Centre on Elder Abuse estimates that almost 60% of those perpetrating these crimes are family members.

In fact, according to a 2022 study of contentious probate cases in the UK, “inheritance disputes among siblings are the most common form of [Will] dispute”. 

Cross-national data on elder financial abuse further underscores the scope of the problem. These figures confirm that inheritance-related fraud is most often an “inside job,” committed by those closest to the elderly victim, frequently a son or daughter abusing trust or authority. 

Inheritance fraud within families can be broadly categorised by the tactics used. Common scenarios include undue influence over a vulnerable parent, the forgery or falsification of Wills and documents, and the misuse of powers of attorney during a parent’s life. Often these tactics overlap, and a determined fraudster may employ several in combination. 

From a psychological viewpoint, undue influence exploits the elder’s mental frailty and emotional dependence. The influencer often plays on their fears or loneliness.

One Australian case involved an elderly father repeatedly changing his Will under the “guidance” of one of his daughters, who was a care provider. The other siblings suspected their sister was pressuring the father each time his dementia advanced, reflecting a pattern of undue influence that courts see frequently (though each case turns on its facts). 

When influence alone is not enough, some unscrupulous siblings turn to forgery or fraud to seize an estate. In one case an English barrister allegedly forged a signature on his mother’s Will to steal his brother’s share of the estate.

While the judge stopped short of explicitly naming the surviving son as the forger (he did not appear in court to defend himself), the outcome voided the fraudulent instruments and protected the other sibling’s rights.

This case highlights how forged documents and last-minute Will changes are red flags that courts can (and should) scrutinise closely.

In a separate case in India, the estate of the Maharajah of Faridkot (worth £2 billion) was tied up for over three decades in court due to a suspected forged Will. The Maharajah’s 1989 Will oddly left all his wealth to a trust controlled by his servants and lawyers, disinheriting his own daughters.

In 2022, a court invalidated the Will as a forgery, returning the vast fortune to the Maharajah’s surviving children. Such dramatic cases underscore that inheritance fraud is a global issue, affecting families from ordinary middle-class households to erstwhile royal dynasties. 

Other forms of elder abuse

Another avenue for intra-family fraud is the misuse of a power of attorney (POA) or other fiduciary authority while the parent is still alive.

It is common for an elderly person to appoint one of their adult children as an agent or attorney-in-fact to handle financial matters This creates a fiduciary duty: the appointed child must act in the parent’s best interest. 

Unfortunately, this fiduciary position can be abused. A sibling with a POA might start siphoning funds, transferring property to themselves, or dissipating assets whilst allegedly managing the parent’s financial affairs.

Unlike Will forgery, which happens after death, POA abuse occurs during the elder’s lifetime – effectively it is theft or fraud against the living parent, but it directly impacts the inheritance of siblings. 

Often this abuse only becomes known later, once the estate is found to be depleted. Misusing a POA is a breach of fiduciary duty and can be addressed in court. In many jurisdictions, an aggrieved sibling can sue the abuser for an accounting and recovery of misappropriated assets, which is where we as lawyers enter the fray. 

The most disturbing scenarios involve outright elder abuse or neglect perpetrated for financial gain. Such elder abuse can be physical, emotional or psychological.

For example, an abusive sibling might intimidate or physically harm a parent to pressure them into giving access to bank accounts, or might deliberately provide substandard care – or no care at all – to conserve the parent’s funds for the inheritance. In some cases, neglect itself is used as a weapon: an heir may isolate a vulnerable parent and deny them proper medical treatment or comforts.

This form of abuse is commonly witnessed by nursing home managers. In multiple cases across the globe, nursing home officials have told investigators that they have seen children pull a parent out of care while complaining about the cost, only to keep the parent at home in poor conditions, solely to avoid spending funds from the estate on care (preserving it for themselves).

Financially-motivated elder abuse is often called the “hidden face of domestic violence” and can often go unreported or unresolved – it’s a hidden crime that takes place behind closed doors.

A few U.S. states have already enacted laws to combat this problem, disqualifying an heir who is convicted of elder abuse from receiving the benefits of the victim’s estate. This is a legal recognition that extreme elder abuse, like murder, violates the fundamental expectations of family and equity.

Psychological toll

The psychological toll of this type of fraud is severe. The victims are often aware on some level that their child is exploiting them, but see it was a trade-off between safety and family love. They may tolerate a level of financial abuse by a child just to maintain that child’s attention or so that they can remain in their own home. 

When one sibling defrauds others in the course of an inheritance, the aggrieved parties usually have a number of avenues for recourse. The primary remedy is through probate litigation: challenging the validity of a Will or transfer in court. If undue influence, fraud, or forgery is proven in a Will contest, the offending Will is voided.

For example, courts in many jurisdictions will invalidate a Will that was the product of undue influence or lack of testamentary capacity, as seen in the Grierson case where the mother’s final Will was set aside for mental incapacity and suspicious circumstances.

A Will found to be forged or signed without proper witnesses is null and void ab initio. In such cases, the estate might revert to a prior Will that reflected the true intent, or if none, to intestacy, where statutes determine the shares for children equally.

Beyond nullifying tainted documents, courts can impose constructive trusts or other equitable remedies to recover assets that were wrongfully obtained.

For instance, if a sibling used a power of attorney to transfer the parent’s house to themselves before the parent’s death, a court can declare that transfer is void, due to breach of fiduciary duty and order the property or its proceeds brought back into the estate. In egregious cases, judges may also surcharge an executor (force them to repay losses to the estate).

In some jurisdictions, victims of inheritance fraud may pursue legal action, separate from the Will contest, where the plaintiff (defrauded heir) can seek damages from the sibling committing the fraud or causing duress.

For example, if a sibling destroyed a Will that would have given someone else a share of the estate, or tricked a parent into disinheriting someone, they could be sued for the value of the lost inheritance. Not all jurisdictions permit this cause of action, however: some require sticking to probate remedies. 

It’s important to note that legal systems vary. Civil law countries (like France, Germany, Japan) have forced heirship rules that guarantee children a fixed share of an estate. In those systems, one sibling cannot easily cut out another via undue influence, because the law itself entitles each child to a portion.

However, even there, fraud can occur through tactics such as convincing a parent to make large lifetime gifts to deplete the estate or forging documents to prove one sibling received their share already.

Transparency is key

In any system, transparency and oversight are key to prevention. England and Wales now has a register for lasting powers of attorney and encourages certificate providers or lawyers to verify that an elder isn’t under duress when signing a Will.

Courts, too, are adapting, developing clearer guidelines and multidisciplinary approaches. In short, the legal framework is evolving to meet the rise in intra-family inheritance fraud, though challenges remain in enforcement and detection.

Sadly, sibling rivalry is a deeply ingrained human experience; conflicts and competition among siblings often span decades, shaped by childhood perceptions of fairness and parental love. When an inheritance comes into play, these latent tensions can explode.

These issues are exacerbated as parents live longer, and offspring struggle to make ends meet, with some children almost willing their parents demise. Greed and envy are powerful motivators, and the prospect of a large inheritance can tap into base human instincts.

The rise in sibling inheritance fraud thus calls for both awareness and preventative action. Legally, one clear message from experts is that early estate planning and transparency can avert many of these issues. 

Parents (the Baby Boomers themselves in this context) are encouraged to make their Wills and estate plans while they are healthy and of sound mind, and to communicate their decisions openly to all children.

Secrecy or last-minute changes breed suspicion, and clear, professional drafting of documents and possibly including no-contest clauses (where lawful) can deter frivolous challenges. Some families use trusts with independent trustees to remove direct control from any one sibling.

From a protective standpoint, elders should be cautious about any one individual (even a child) gaining complete control over finances – measures like requiring dual signatures, or periodic accounting to another family member or to an attorney are advised.

Financial institutions and care providers are increasingly trained to spot signs of undue influence or exploitation, such as unusual account activity or a domineering relative who won’t leave the elder alone during consultations. In many places, banks have protocols to report suspected elder financial abuse to authorities or adult protective services. These safety nets, however, are only part of the solution.

Ultimately, inheritance fraud by siblings is a multifaceted problem at the crossroads of law, family, and psychology. The Baby Boomer legacy will not just be in the wealth they leave behind, but also the conflicts that follow from contested Wills.