The Cooneys walked into the office to hear their test results. Matt Cooney, a 79-year-old retired television sportscaster, was informed that his financial decision-making capacity was in jeopardy. Dobe Cooney admitted that her husband had lost track of their bills a few times lately. "We don't leave the teeth in the refrigerator or anything like that," said the 75-year-old former nurse. "But as we get older, we seem to forget a lot." The exam had not been administered by their doctor but by their financial advisor, Carolyn McClanahan. McClanahan, a certified financial planner and a medical doctor, is the founder of Life Planning Partners in Jacksonville, Florida. At her recommendation, Matt went to his own physician with the findings. As it turned out, Matt indeed, had had a few silent strokes over the years. Matt and Dobe Cooney Such discoveries are coming to the surface in the offices of financial advisors across the country, as it becomes increasingly common for financial professionals to probe clients for signs that they are at risk of making poor decisions or turning into victims of fraud or abuse. "Advisors tend to be very close to their [clients]," said Jim Wrona, vice president and associate general counsel at the Financial Industry Regulatory Authority, a self-funded regulator of the brokerage industry. "They're in a fairly good position to know when something is out of the ordinary."

As we get older, we seem to forget a lot. Dobe Cooney

Demographic shifts are one of the reasons advisors are increasingly discussing memory alongside risk tolerance. By 2035, there will be some 78 million people in the U.S. aged 65 and older. Up to 20 percent of people over the age of 65 have some form of cognitive impairment, and more than half of people older than 85 have Alzheimer's disease or another kind of dementia. As a result, older investors are a prime target for exploitation. Seniors lose an estimated $2.9 billion annually from fraud or financial abuse, according to the Senate Special Committee on Aging. "Most advisors' clientele are in their 60s and 70s, and these types of issues are front in mind," said Chris Heye, the co-founder of Whealthcare Planning, a platform that helps people financially prepare for aging and tests their decision-making capacities.

Carolyn McClanahan Source: Carolyn McClanahan

A new spate of regulations is another reason advisors are keeping tabs on their clients' mental state. Two new FINRA rules aimed at protecting older investors went into effect last year. One of them requires that financial advisors ask their clients for a trusted contact in case they exhibit red flags, such as wanting to invest their lifetime savings in bitcoin. The other permits financial advisors to put a temporary hold on their clients' bank accounts if they suspect exploitation is occurring. To be sure, some elderly clients may find their advisors have overreached. Last year, a woman sued Fidelity, after the company froze her assets when it became concerned about her judgement. As a result, the woman claimed, she was unable to pay her electric bill, visit the dentist or take her dogs to the veterinarian. Still, Wrona said advisors often hear from their older clients with suspicious requests and are unsure of how to respond. "A [client] will say, 'I won the lottery, but I need to pay the taxes upfront before I can claim the award,'" Wrona said. If the client demands the money even after the advisor has explained that it's a scam, he or she can then temporarily pause their assets and investigate further. More than a dozen states have also passed laws that allow financial firms to pause disbursals when financial exploitation is suspected. Congress passed a law last year called The Senior Safe Act, which encourages advisors to get trained in spotting fraud or abuse and report any such instances to law enforcement. "Getting that training is going to stop a lot of financial exploitation," said Cristina Martin Firvida, vice president for financial security and consumer affairs at AARP.

Chris Heye Source: Chris Heye

Beyond looking out for obvious scams and threats, more advisors are proactively planning for the issues their clients could face as they climb up into their later decades. Gary Vawter, a financial advisor for more than 30 years and the owner of Vawter Financial in Columbus, Ohio, said he quizzes nearly all of his clients over 60 on their decision making abilities. (He uses the Whealthcare Planning platform to do so). One question on it asks, "What month is it?" There are also other math and financial literacy problems. "It's pretty neat when the client brags that their financial advisor is having them do these tests to find out how vulnerable they are," Vawter said. "Their friends are amazed that their doctor isn't doing it." Another reason Vawter does this: A new law in his state requires advisors to report instances of financial exploitation to the authorities.

Gary Vawter Source: Gary Vawter

After McClanahan and the Cooneys discussed their issues, they talked about how to protect themselves. Now, the couple review their bank accounts more frequently and pay their bills together. If both of them find their financial decision-making capacity declining, McClanahan has asked their children to pitch in. "The kids were just so relieved that we were looking out and that we had a plan in action," she said. Many of the financial plans for older people involve their family members. Yet often it's these relatives who are the problem.