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Regarding your Dad being verbally and physically abusive to you, has your Dad been tested for an urinary tract infection? Such an infection can cause such problems.
As for telling your Dad about your neighbors past history, I wouldn't tell Dad anything. With dementia your Dad's mind may start to believe in things that aren't happening, with him calling 911, etc.
That said, your father is not capable of living on his own. I most certainly would tell him the neighbors' history -- after you get him the hell out of there. As he has dementia, telling him while he's next to them isn't a good idea because he may blab to them what you said, or it won't matter that you told him because he'll forget you told him.
Bottom line -- he is not capable of living on his own. He'd actually do very well in a memory care facility where mental stimulation is the primary focus. He'd make friends with a lot of people, and would likely do better than he is now.
Could dad get out of his side of the property completely on his own if there was a fire?
Can dad totally on his own lock all his doors and windows and open them as well?
Can dad use the phone and call 911 or 311 or the fire Dept totally on his own and be able to give his address and stay on the line?
If not, he needs to be someplace with 24/7 oversight. it’s for his own safety & security.
Your dad is renting, right? Is his landlord aware of his blindness? Usually renting to the blind is something most won’t want to do, due to liability issues as most apts are not handicapped compliant but his landlord sounds like he ok with renting to folks that others would not ever rent to. Is the neighborhood real real sketchy?
On telling him that the neighbor is a sex offender. There is a required Notification by mail on these & done by the Sheriffs department. The notification will have a photo and details on the type of conviction and date of offenses. It’s not a secret, you should tell tell your dad imo. Personally I’d call the Sheriffs Dept to get them to email it to you so you have it &make sure that the address is clearly not your dads. Duplex’s often share the # but followed by an “A” or .5. You don’t want dad associated by a shared address.
You are fortunate that you already have guardianship on him. That should thwart them from trying to get control over his Social Security as you should be getting it as his representative payee and there's a court order on this. That is what is happening, right?
If you are new to guardianships, find out exactly what the required reporting is to the court and what the forms are. It could be that you as guardian have to report $ spent on caregivers or aides or in home health worker. $ he pays the neighbors may need to be documented & reported. I bet that if you tell them you are going to need them to submit a receipt of $ received by them with name and address & SS#, and that’s it’s going to be filed in court, they will stop doing things.
If her gran has moved in with them, that may be a lucky break for dad. They will have her Grans SS $ to use so not as needy to grift off him.
He is not safe living alone for a variety of reasons, not just b/c his neighbors are convicted felons & sex offenders. Your father will benefit from the social interaction he gets in a Memory Care Assisted Living, plus he'll be safe from con artists and he will get help with all of his daily needs, plus 3 hot meals a day & 3 snacks. If he's aggressive and physically abusive due to his dementia, he'll need to be seen by his doctor and get medication to control that behavior before you place him, however. The goal of Assisted Living is for all of the residents to feel safe and happy.
Good luck!