Financial scams that prey on seniors are common and extremely expensive. According to the FBI, seniors lose more than $3 billion each year as a result of identity theft. Scammers target seniors because they believe older adults have a significant amount of money sitting in their bank accounts waiting to be taken advantage of them.
However, it is not only wealthy seniors who are being targeted. Low-income older adults are particularly vulnerable to financial exploitation. And it is not always strangers who are responsible for these heinous crimes. Over 90% of all reported elder abuse is perpetrated by a senior's own family members, most often their adult children, followed by grandchildren, nieces and nephews, and other family members.
Because financial scams are frequently unreported and difficult to prosecute, they are regarded as a "low-risk" criminal offense. These policies, on the other hand, are devastating to many older adults, placing them in a vulnerable position with little time to recover their losses.
Recognize and avoid the most common scams so that you can protect yourself and your loved ones from becoming victims of financial fraud.
1. Scams involving impersonating government officials
Callers posing as representatives of the Internal Revenue Service (IRS), the Social Security Administration, or Medicare make unsuspecting victims believe they are speaking with representatives of the government agencies. In some cases, they may claim you owe back taxes and threaten you with arrest or deportation if you don't pay up right away. Alternatively, they may claim that your Social Security or Medicare benefits are at risk of being terminated if you do not provide personal identifying information (that can then be used to commit fraud). Government impersonators frequently "spoof" the actual phone numbers of government agencies, or they call from the same zip code as the government agency in question (202 for Washington, DC).
2. The grandparent deception.
The grandparent scam is both simple and devious because it takes advantage of one of older adults' most reliable assets, their hearts, to carry out its deception. Calling an elderly person and saying something along the lines of "Hi Grandma, do you know who this is" is a common scam tactic. When the unsuspecting grandparent correctly guesses the name of the grandchild the scammer most resembles, the scammer has successfully established a fictitious identity without having conducted any background research. Once "in," the fictitious grandchild will ask for money to help with an unexpected financial problem (such as past-due rent, car repairs, or a jail bond), and will beg the grandparent not to tell anyone about the situation. Because scammers request payment via gift cards or money transfers, which do not always necessitate the presentation of identification in order to be collected, the senior may have no way of ever seeing that money again.
Scams involving Medicare and health insurance
Every citizen or permanent resident of the United States over the age of 65 is eligible for Medicare, so it is rarely necessary for a scam artist to research which private health insurance company older people are members of in order to defraud them of their hard-earned money. The perpetrators of these scams may pose as Medicare representatives in order to coerce older people into providing them with personal information, or they may provide bogus services to elderly people at makeshift mobile clinics, after which they will bill Medicare and pocket the funds. Medicare scams frequently follow the most recent medical research trends, such as genetic testing fraud and the use of COVID-19 vaccines, among others.
4. Scams involving computer technical support
Scammers prey on people's lack of knowledge about computers and cybersecurity by posing as technical support representatives. In most cases, a pop-up message or a blank screen appears on your computer or phone, informing you that your device has been compromised and needs to be repaired. Depending on how you contact the support number for assistance, the scammer may either request remote access to your computer or demand that you pay a fee to have your computer repaired. As reported by the Federal Trade Commission (FTC), seniors who fell prey to this scam in 2018 lost an average of $500 each to computer tech support scams.
5. Scams involving sweepstakes and lotteries
This straightforward scam is one that many people are familiar with, and it takes advantage of the common misconception that "there is no such thing as a free lunch." In this scenario, scammers inform their victims that they have won a lottery or sweepstakes of some sort and that they must make a payment in order to receive the allegedly won prize. When seniors receive a check, they should deposit it in their bank account immediately, knowing that the check (which is a forgery) will be rejected after a few days. As soon as the check bounces, the criminals will quickly collect money for alleged fees or taxes on the prize, which they will keep in their pockets while the victim has the "prize money" removed from his or her account. When compared to some of the other types of scams mentioned here, lottery and sweepstakes scammers have the potential to make thousands of dollars from their unsuspecting victims.
6. Robocalls and other phone scams
Robocalls are automated phone calls that take advantage of sophisticated phone technology to call large numbers of households from any location on the planet. Robocallers employ a variety of deception techniques to defraud their victims. Some customers may claim that their vehicle's or electronic product's warranty has expired and that they must pay to have it renewed. An example of a popular robocall is the "Can you hear me?" call, in which, if the senior responds affirmatively, the scammer hangs up after recording their voice, allowing the scammer to use the voice signature to authorize unwanted charges on items such as stolen credit cards.
7. Scams involving romantic relationships
The increase in the number of people who use the Internet for dating provides con artists with an opportunity to find their next victim. Romance scammers create elaborate fake profiles, which they often post on social media, and prey on seniors' feelings of loneliness in order to make money. In some cases, romance scammers may be (or pretend to be) located overseas, and they may ask for money to cover the costs of visas, medical emergencies, and travel expenses in order to come to the United States. Because romance scams can last for a long period of time, they can extract a significant amount of money from seniors. According to the Federal Trade Commission, seniors lost nearly $84 million to romance scams in 2019.
8. Phishing on the internet and through email
However, while using the Internet is an excellent skill to have at any age, the slower rate of adoption among some older people makes them more vulnerable targets for automated Internet scams that are prevalent on the web and in email programs such as Outlook. In order to trick victims into downloading a fake anti-virus program (at a significant cost) or an actual virus that will open up whatever information is on the user's computer to scammers, pop-up browser windows that impersonate virus-scanning software will appear on their computers. Seniors are particularly vulnerable to such traps because they are unfamiliar with the less visible aspects of web browsing (such as firewalls and built-in virus protection, for example), making them particularly vulnerable.
Phishing emails and text messages may appear to be from a company you are familiar with or believe to be trustworthy. They may appear to be from a financial institution, a credit card company, or an online retailer. Phishing emails ask for your personal information, such as a log-in or Social Security number, in order to verify your account, or they ask you to update your credit card payment information, among other things. These individuals then utilize your personal and financial information to steal it for their own gain.
9. Financial exploitation of the elderly
Elder financial abuse, in contrast to many other scams, is perpetrated by someone who is familiar to the senior. This can be a family member, a friend, a power of attorney, or an individual who provides care. These well-meaning individuals attempt to gain control over a senior's money, assets, and credit history. They may also refuse to provide necessary care in order to maintain control over the individual and their assets. Seniors who have a disability or cognitive impairment (such as dementia) may be particularly vulnerable to this type of attack.
10. Scams involving charitable organizations
The goodwill of seniors is exploited by charity scammers who pocket the money they claim to be raising for a good cause. Some scammers may use a name that is similar to that of a legitimate charitable organization. They frequently take advantage of current events, such as natural disasters, and may set up a fundraising page on a crowdsourcing website, which does not always have the resources to investigate fraud allegations. Charity scammers may insist on receiving your donation right away, and they may use a payment method that should raise red flags, such as gift cards or money transfers.
If you believe you've been a victim of a scam, you should...
Don't be afraid or embarrassed to talk about it with someone you trust if you're feeling uncomfortable. You are not alone, and there are people who are willing to assist you. Doing nothing will only make the situation worse. Keep a list of the phone numbers and resources you can use to get help, such as the local police department, your bank (if money has been taken from your accounts), and Adult Protective Services, close at hand at all times. Obtaining information about Adult Protective Services in your area can be accomplished by calling the Eldercare Locator at 1-800-677-1116, which is a government-sponsored national resource line. Alternatively, you can visit their website at https://eldercare.acl.gov.
Scams can also be reported to the Federal Trade Commission through their website.
