From Suspicion to Action: Helping credit unions spot cognitive decline earlier

By Jenny Leight, Business Strategy, Carefull

Every day, credit unions across the country process transactions that tell a story no doctor has heard yet.

A longtime member who paid her bills like clockwork starts missing payments. An 80-year-old calls three times in a week about the same charge he doesn't recognize. A client who hasn't touched his savings in a decade suddenly withdraws $15,000 in cash. A woman who has managed her own finances for 40 years asks a branch associate to help her understand why her balance is so low – and can't recall the large transfers she made herself.

These moments happen constantly. They are, in many cases, the earliest observable signs of cognitive decline – surfacing in account activity and branch interactions long before a family notices anything at home, and years before any clinical diagnosis is made.

A Widening Gap

In 2024, older adults reported $4.9 billion in losses to the FBI's Internet Crime Complaint Center – a 43% jump from the year before. The FTC estimates the real figure, once underreporting is factored in, could be as high as $81.5 billion.

That gap between what's reported and what actually happens is the whole problem. And it doesn't stop at the victim level.

Fewer than 28% of suspected exploitation cases observed by frontline bank and credit union staff are ever reported to adult protective services, law enforcement, or other authorities. That means most of the time, a teller who senses something is wrong finishes the transaction anyway. A branch manager who notices a pattern files it away. A member service rep who hears confusion on the other end of the line wraps up the call.

Not because they don't care. Because they don't have a clear path forward – no protocol, no trusted contact to call, no tool that helps them name what they're seeing and do something about it.

Why the Institution Is Always First

Here's the structural reality that makes this problem so urgent, and the opportunity so significant: financial institutions are positioned to detect cognitive decline before almost anyone else.

Doctors see patients episodically, maybe once a year for a wellness visit, maybe more often if something is clearly wrong. Family members often live at a distance, visit on holidays, and normalize changes in a parent they see gradually. Friends and neighbors may notice but don't have access to the financial picture.

Your institution, by contrast, has a continuous, longitudinal record of exactly how this person manages money: what they spend, when they pay, how often they call, which channels they use, and when any of that changes. A 2025 study published in JAMA Network Open, drawing on data from more than 66,000 adults, found that behavioral changes in banking data like fewer logins, more PIN resets, reduced spending on travel and hobbies can signal early cognitive decline up to a decade before someone formally loses the capacity to manage their own finances.

A decade. That is not a small window. That is years of opportunity to intervene, to involve a trusted contact, to have a supportive conversation with a family member, to protect what a client has spent a lifetime building.

Most institutions are letting that window close without acting.

The Infrastructure Problem

The gap between seeing and doing isn't a training problem alone, although training is definitely a critical component. It's an infrastructure problem. Frontline staff who suspect something is wrong often face a set of obstacles that make inaction feel safer than action:

• They don't have a trusted contact on file to call, so even if they want to flag a concern, there's no designated person to reach

• They're uncertain about privacy rules and worry about doing something wrong by raising an issue

• They lack a clear escalation protocol, so the moment of concern passes and the transaction goes through

• And they're not equipped with monitoring tools that would help them see patterns over time rather than reacting to isolated incidents

The result is that interventions happen late – after significant money has moved, after a scammer has established trust, after a client's cognitive decline has progressed to the point where family can no longer deny it.

AARP's BankSafe research found that when frontline employees are trained and empowered to intervene, they stop exploitation in one out of every two attempts. Trained employees saved 16 times more money from exploitation than untrained peers. The capacity to protect clients is clearly there. What's missing is the structure that lets it happen consistently.

The Regulatory Environment

For institutions that have treated elder financial protection as a values issue but not yet a compliance priority, that calculus is shifting.

In December 2024, the OCC, FDIC, CFPB, Federal Reserve, NCUA, FinCEN, and state financial regulators issued a joint Interagency Statement on Elder Financial Exploitation, one of the clearest signals yet that regulators are urging institutions to have active, documented practices in place for identifying, preventing, and responding to exploitation. It outlines specific recommended risk management practices and makes clear that elder financial protection is a safety issue.

The Financial Exploitation Prevention Act, which would allow financial institutions to delay suspicious transactions and require the SEC to issue regulatory recommendations on elder fraud, was reintroduced in both chambers in 2025 and passed the House Financial Services Committee with a unanimous 50-to-0 vote. Broad bipartisan support suggests this is a matter of when, not if.

At the state level, the picture is already clearer. Four states passed new elder financial exploitation laws in 2024 alone. As of now, 26 states and Washington, D.C. mandate reporting of suspected exploitation by financial institutions, and 40 states give broker-dealers and advisors specific authority to delay disbursements when exploitation is suspected.

The direction is unmistakable. Institutions that build the infrastructure now, trusted contacts, transaction monitoring, staff training, clear escalation pathways, will be ahead of requirements that are increasingly likely to become mandatory.

The Other Side of the Ledger

There's a business case here that goes beyond compliance, and it's one that doesn't get discussed enough in the context of elder financial protection.

Households over 60 control roughly 65% of all U.S. household wealth, according to Federal Reserve data, and their adult children are watching closely how institutions treat their parents. Research consistently shows that four in five consumers prefer banking with institutions that actively work to combat exploitation and that trust increases 41% when an institution successfully resolves an exploitation incident. The AARP estimates that financial institutions lose $1 billion in deposits annually as a direct result of exploitation.

The wealth transfer from older generations to their children represents one of the largest intergenerational asset movements in history. The institutions that demonstrate they genuinely protected mom or dad are the ones that retain the next generation. The ones that missed the warning signs, or saw them and did nothing, are the ones that lose the relationship at the most consequential moment.

Closing the Gap

What does it actually look like to build the infrastructure that turns observation into action?

It starts with trusted contacts, collected proactively, not as an afterthought. FINRA Rule 4512 requires member firms to make reasonable efforts to collect trusted contact information for retail accounts. NCUA guidance encourages the same for credit unions. A trusted contact doesn't have account access or legal authority; they're simply the person your team can call when something seems off. FINRA has found that having a trusted contact on file allows firms to resolve potential exploitation cases 65% faster.

It requires monitoring tools that surface behavioral anomalies over time, not just individual transactions, but patterns that only become visible by analyzing someone's financial footprint. This helps to switch to proactive notifications directly to the person being protected, and their family members, so intervention can often occur before the problem ever shows up in branch.

It depends on clear protocols that tell staff what to do in the moment, how to slow a transaction down without accusation, what questions to ask, who to escalate to, and how to document a concern.

And it benefits enormously from caregiver coordination tools, platforms that allow a designated family member or trusted contact to have monitored, view-only visibility into an aging parent's finances, so that the institution isn't the only set of eyes watching.

None of this is about restricting autonomy. It's about building a system that catches what individual interactions miss, and gives everyone involved, the member, the family, and the institution, a better chance of catching problems early enough to matter.

What's Already in Your Data

The warning signs are already there. The behavioral signals that precede cognitive decline, the transaction patterns that precede exploitation, the member interactions that precede a crisis – they're passing through your institution every day.

The question is whether you have the infrastructure to recognize it, the protocols to act on it, and the tools to connect the dots before the damage is done.

The window to protect your clients, and your institution, is open. The institutions that act now will define what responsible financial services looks like for an aging America. Carefull’s AI platform identifies the early signs of cognitive decline and can alert members, and their families, to these signs up to seven years before they are diagnosed in a doctor’s office.

Connect with Carefull to learn more.