Loss of memory leads to loss of money as dementia patients get scammed

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Loss of memory leads to loss of money as dementia patients get scammed

Published: 06 May. 2025, 19:24 Updated: 06 May. 2025, 19:27

Audio report: written by reporters, read by AI

Patients play with instruments at a hospital in Eunpyeong District, northern Seoul, on April 4, 2024. [NEWS1]

For the past four years, hundreds of dollars oftentimes disappeared from the account of a dementia patient in their 80s living in Seoul. The patient's son found it strange as his parent had been known for frugality and the withdrawals were out of character. Later, it turned out that a "friend" had taken advantage of their dementia, obtained their bank credentials and pocketed the money.

Though the son managed to block further withdrawals, the worries remain.

“I looked into the legal guardianship system, but it was too complicated to use,” the son said. “There’s tension in the family too — I’m worried we’ll face inheritance disputes in the future.”

Cases like this are becoming more common — and more concerning. New data show that Korea’s elderly dementia patients now collectively hold 154 trillion won ($110.55 billion) in assets, equivalent to over 6 percent of the country’s GDP. With the pace of population aging accelerating, the value of so-called dementia money is projected to rise rapidly, prompting calls for better asset protection and management systems.

On Tuesday, the Presidential Committee on Aging Society and Population Policy released the findings of the country’s first full-scale survey on the finances of elderly dementia patients. The committee worked with the National Health Insurance Service and Seoul National University’s Center for Health and Finance to analyze five years’ worth of data — including medical expense claims, income from pensions and other sources and real estate ownership — to assess the financial standing of this demographic.

As of 2023, Korea had 1,240,398 dementia patients aged 65 or older. Of those, 61.6 percent — or 764,689 individuals — had assets or income. The combined value of their holdings was estimated at 153.5 trillion won, about 6.4 percent of GDP. While dementia patients account for just 2.4 percent of Korea’s total population, making up 1.24 million of 51 million, they control a disproportionate share of private assets.

Asset composition was heavily weighted toward real estate, which made up 74.1 percent of total holdings at 113.8 trillion won, followed by financial assets at 21.7 percent, or 33.4 trillion won.

Demographic projections show a steep rise in dementia cases — 1.79 million by 2030, 2.85 million by 2040 and 3.97 million by 2050. At that pace, dementia money could grow more than three times to 488 trillion won by 2050, equivalent to 15.6 percent of that year’s projected GDP.

The increase in dementia money has troubling implications. On an individual level, patients are vulnerable to financial exploitation by those who abuse their impaired decision-making.

Recent cases have raised alarms. In 2021, a caregiver was arrested for stealing 1.2 billion won from a patient’s bank account. Last September, a man in his 20s was sentenced to two years in prison for impersonating a grandson and stealing 141 million won.

When banks detect signs of dementia in customers, they often restrict withdrawals — a safeguard that can lead to financial hardship for patients and families and ultimately leads to a broader social and economic loss as the funds no longer circulates through consumption or investment.

A senior citizen eats juk (Korean porridge) on the side of the road in Jongno District, central Seoul, on March 24. [NEWS1]

Japan, which has long grappled with this issue, offers cautionary examples. In one case, a welfare recipient was found to have more than 11 million yen ($76,840) in a bank account after death. In other cases, adult children have gone bankrupt because they were unable to access the assets of the parents they were caring for.

Despite the urgency, Korea’s response remains inadequate. The public guardianship program is underused, and the public trust system — in which the government manages assets on behalf of patients — is still in its pilot phase.

“There’s been little social discussion about how to maintain self-determination when individuals become vulnerable to dementia,” said Seok Jae-eun, a professor of social welfare at Hallym University. “Beyond expanding public and private trust systems, people entering old age need an opportunity to evaluate and restructure their assets. We need retirement asset planning services with stronger professional support.”

The committee plans to update its dementia money data annually.

“This first comprehensive estimate of dementia money is an important starting point for creating systematic policy responses,” said Joo Hyung-hwan, vice chair of the committee. “We will follow up with commissioned research and include asset protection measures in the Fifth Basic Plan on Aging and Low Fertility, to be released at the end of the year.”

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.
BY NAM SOO-HYOUN [[email protected]]