The number of reports of financial crimes against the elderly is increasing:

Every year, more than $3 billion is taken from the retirement accounts of the elderly.

Every year, more than 3.5 million older adults become the victims of financial exploitation, according to the National Council on Aging.

Seniors who are targeted by fraudsters lose an average of $34,200 each year.

Scammers can prey on people of any age group, including children. Those over the age of 60, on the other hand, are frequently more vulnerable, and victims over the age of 80 report even greater financial losses.

Financial loss according to age group

Fraud losses are not uniform across age groups, and older people are more likely than younger people to suffer financial losses as a result of fraud. In the year 2019:

People between the ages of 20 and 59 experienced lower median losses than older people.

Those between the ages of 70 and 79 experienced a median loss of $600.

Adults over the age of 80 experience a median loss of $1,600.

Individual monetary loss reported by age group in the year 19 is $2,919 on average.

Top financial scams that prey on the elderly

Based on data from the Federal Trade Commission (FTC), the types of fraud that older Americans are most likely to fall victim to are as follows:

Scams involving online shopping

Scams involving technical support

Scams involving impersonators

Scams involving romantic relationships

Scams involving sweepstakes

Scams of a different nature

The Federal Trade Commission also maintains records of the methods used to perpetrate these scams, which include:

In 2016, 16,000 cases of scam phone calls were reported, with the average cost being $1,500.

10,000 cases of online theft were reported, with a median loss of $395 in each case.

A total of 6,000 cases of consumer-initiated contact resulted in a loss, with a median cost of $300.

Email scams resulted in a loss in 4,000 cases, with a median cost of $500 in each case.

Mail fraud caused a loss in 1,000 cases, with a median cost of $1,800 in each case.

According to this information, phone calls appear to be the preferred method of communication for scammers. Approximately 2.4 billion robocalls are made each month, according to the Federal Communications Commission (FCC). Spoofed area codes are frequently used by robocallers to make it appear as if they are calling from the victim's local area or with the caller ID of a government agency. Typically, an automated message will be sent to the victim informing them that they owe money or that they must take immediate action on a situation.

1. Scams involving online shopping

Despite the fact that online shopping fraud is the most commonly reported type of fraud among older Americans, people over the age of 60 report that they have lost less money as a result of this type of fraud than they have with many other types of fraud. Despite this, people over the age of 60 are said to have lost at least $14 million to online shopping scams in the past year.

While the internet has surpassed traditional shopping methods for many people, it has also become a haven for scammers posing as legitimate online retailers. Occasionally, these websites will appear to be legitimate, and the domain name may even be a slight variation of a well-known company's trademark. These websites attract customers with their low prices, but the products they advertise are often drastically different from what the buyer receives — when the buyer receives anything at all, as is often the case.

These scams, on the other hand, can be difficult to spot. Make use of third-party websites to research the company's reputation, and be wary if an online merchant requests that you make a payment in an unusual manner, such as via a check or wire transfer.

2. Scams involving computer technical support

Scammers claim that their victims' computers are infected with viruses or have other issues that they can help them with. It is then possible for them to make money by asking victims to pay for services that aren't actually required. In the year 2019, scammers preyed on elderly victims, stealing $24 million from them.

Though they may call people directly to warn them about "computer problems," the most common way for tech support scammers to contact victims is through the internet. It is possible that on certain websites, pop-up warnings will appear, informing users that their computers have a virus or a security issue. Despite the fact that the message appears to be urgent and may contain official-looking logos, it is simply a ruse to trick the recipient into making contact and sending money.

Tech scammers frequently pose as representatives from well-known companies such as Microsoft or Apple. Most major technology companies, on the other hand, claim that they do not contact customers about these issues. Simply close out the tab and ignore the warning that appears when one of these pop-ups appears.

Scammers may also request access to your computer through a remote connection. However, while legitimate computer care companies may use remote access to resolve technical issues, you should avoid granting access if you haven't thoroughly checked out the person on the other end.

3. Scams involving imposters

In imposter scams, fraudsters may pose as officials from government agencies, banks, friends or family members in order to trick people into disclosing bank account numbers, passwords, and other personally identifiable information.

Scams involving impersonating family members

In family imposter scams, fraudsters pose as a loved one, either by creating an online profile that looks like them or by hacking personal emails or social media accounts to gain access to their information. They will frequently claim that they are in desperate need of money as a result of an emergency and will request that funds be transferred immediately.

If a family member asks you to send them money via the internet, it's important to thoroughly vet the person you're communicating with and ask them questions that only your loved one would know the answers to. It's also important to refrain from sending money right away if possible. Scammers prey on your fear and anxiety, but if you take the time to speak with your relative directly, you can determine whether or not they truly require your assistance.

Scams involving impersonating government officials

According to the Federal Trade Commission, only 6 percent of those who report government imposter scams claim to have lost money. People over the age of 80, on the other hand, suffered an average loss of $2,700 as a result of these types of scams.

Seniors are frequently targeted due to the fact that they typically have good credit.

Scams involving impersonating the Social Security Administration

If a victim's Social Security number has been linked to criminal activity and/or suspended, the imposter may inform them of this. Once the victim provides their SSN, the scammer will claim that they will be able to reactivate the number. Other Social Security scams may inform victims that they are eligible for a benefit increase and ask them to confirm their identity by providing their name, date of birth, and Social Security number. Using either of these methods, you can gain access to personal information that can be used to gain access to private accounts and financial information.

Actual representatives from the Social Security Administration will never ask for your Social Security number over the phone, and they will never contact you if you haven't recently communicated with them about anything. Notifications of impending arrest, the suspension of your Social Security number, or the loss of benefits are all indications that the notice is a hoax.

Scams involving impersonating the Internal Revenue Service

The impersonation of the Internal Revenue Service (IRS) is yet another popular government scam. A typical example of this type of scam involves calling victims directly and telling them that they owe taxes that, if they do not pay, could result in their arrest or other legal action. In order to intimidate victims into immediately sending the requested money or providing personal information such as bank account or Social Security numbers, the scammer must first gain their trust.

If you receive a phone call with any of these characteristics, the Department of the Treasury recommends that you hang up immediately. If there's a problem with your taxes, the IRS will usually send you a notice in the mail first to alert you of the problem. Personal financial information such as PINs, passwords, or credit card numbers will never be requested by the Internal Revenue Service (IRS).

According to the Treasury Inspector General for Tax Administration (TIGTA), the following states have suffered the most losses as a result of IRS scams:

California has suffered a loss of more than $10 million.

More than $4 million has been lost in New York.

Texas has suffered a $4 million loss.

Illinois suffers a loss of over $3 million.

More than $2 million has been lost in Florida.

By sending cease-and-desist letters, requesting that telephone companies deactivate the numbers involved in these crimes, publishing phone numbers associated with this fraud, and educating the general public on how to recognize these scams, the TIGTA has been working to thwart the efforts of these scammers.

4. Scams involving romantic relationships

A new high of $304 million in reported losses to romance scams is expected in 2020, making them the leading cause of fraudulent financial loss across all age groups. Because of the increasing popularity of online dating, the number of people who fall victim to romance scams has increased significantly in recent years. Since 2016, there has been a nearly threefold increase in the reported number of romance scams. People aged 70 and older had the highest median loss from this type of fraud, with a total of $9,475. Despite the fact that they are the least vulnerable age group to romance scams.

In this type of fraud, people over the age of 70 had the highest median loss, with a loss of $9,475."

Scammers typically create a fake profile on dating websites or social media platforms, then reach out to vulnerable individuals and develop a relationship through chatting or texting. Scammers frequently make up reasons for why they are unable to meet in person. This was made possible by COVID-19, according to the Federal Trade Commission, which stated that some scammers claimed they were unable to meet due to the COVID-19 test.

At some point, romance scammers will approach their victims and ask them for money. Last year, reports of gift card requests increased by 70%, indicating that gift cards are becoming a more popular method of receiving funds in general. The Federal Trade Commission also warns that scammers may send money to victims first and then ask for it back, implying that the scammer is harboring stolen funds, according to the FTC.

It is recommended that people never send money to someone they haven't met in person in order to avoid falling victim to a romance scam. Additionally, a reverse image search of the photos on a suspicious profile can reveal whether the photos are stock photography or the work of another individual.

5. Scams involving sweepstakes

In 2020, the Federal Trade Commission received more than 116,000 reports of scams involving sweepstakes and lotteries. victims of any age suffered losses totaling at least $166 million, with the average loss standing at $1,000. According to the Better Business Bureau (BBB), this type of scam, on the other hand, typically targets elderly people.

Sweepstakes fraudsters frequently communicate with their victims through the mail, phone calls, email, or social media. According to the Better Business Bureau, social media is now responsible for one-third of all reported lottery scams. The typical pattern of a sweepstakes fraud is for the victim to be congratulated on winning a large sum of money, which is not the case. However, in order to receive it, they must first pay a processing fee or tax, which varies by country. Even if a victim pays the amount requested by the scammer, the scammer will usually contact them to request additional funds in order to deliver the prize to them.

In most cases, true sweepstakes state that "no purchase is necessary," and winners should never be required to send money to claim their prize. Even though legitimate lottery games like Mega Millions or Powerball sell tickets, they will never charge participants any money in order to receive their prizes, according to the Federal Trade Commission.

6. There are various other types of financial scams.

Scams involving the purchase and resale of timeshares, investment fraud, and health insurance fraud are all common among people over the age of 60. In 2019, timeshare sales and resale scams defrauded people over the age of 60 out of a total of more than $30 million. People in this age group have also reported a total loss of $25 million as a result of investment scams.

In other scams, criminals may appear in person and claim that they can fix any problem that the victim is experiencing in their home. These con artists will request an advance payment but will either never return or will steal the identities of their victims.

Fraudsters are constantly coming up with new ways to deceive people into handing over their money. Regardless of whether or not the method is listed here, it is important to be wary of anyone who requests payment in advance or immediately, especially if the payment is made by gift card or wire transfer. When in doubt, don't send any of the money that has been requested, and instead speak with someone you trust about the potential scammer who has approached you.

Discover what consumers need to know about identity theft, how to find the best identity theft protection services, and how to find the best credit monitoring services in our comprehensive resource guide.

Prevention and response to financial crimes against the elderly are two important objectives.

It is beneficial to file a complaint if you have been contacted by a fraudster, regardless of whether or not you have lost money. The Better Business Bureau, the Federal Trade Commission, and the FBI's Internet Crime Complaint Center are among the organizations that respond to these types of crimes.

If you have lost money as a result of a scam, you may be able to contact your bank or credit/debit card company and request that the payment be canceled. The recovery of funds from scams that make use of gift cards or wire transfers, on the other hand, is much more difficult.

If you have been a victim of a scam, other individuals or groups may attempt to con you again. Do not send money to anyone who calls you with a suspicious story that sounds similar to yours. Additionally, you should continue to report these fraud attempts to the appropriate authorities, as necessary.

You can also register your phone number with the National Do Not Call Registry to avoid receiving unsolicited calls. This list was compiled in 2003 in response to an increasing number of direct-sales companies that were clogging up people's phone lines and interfering with their lives. Despite the fact that robocallers are likely to disregard whether or not you are on this list, it can still be a useful first step in reducing these types of calls.

Statistics on financial fraud among the elderly

We can't get a sense of how widespread fraud is because data is frequently underreported, particularly among the elderly population. According to one study conducted in New York State, only one fraud case is reported for every 44 that occurs, and according to data from the Federal Trade Commission, seniors are 94 percent more likely to report fraud attempts if they haven't suffered any financial losses. This reluctance to report can be due to feelings of embarrassment or the fact that older people do not want to alert family members about their inability to manage their financial affairs.

In the year 2020 alone, the Federal Trade Commission documented 4,720,743 incidents across all age groups, according to the agency. Approximately 221 percent increase in the number of reports of fraud, identity theft, and other similar crimes has occurred since 2010. It is possible that more victims are reporting fraud than in previous years, even if this does not necessarily imply that there are more scams being perpetrated in general.

Furthermore, only about half of the scams reported to the FTC include information about the victim's age. According to the most recent report available at the time of publication, there were 318,850 reported cases of people over 60 being victimized among consumers who included their age in their purchase.

The bottom line is this:

In recent elderly poverty statistics, it has been discovered that seniors are particularly vulnerable to financial scams because the majority of them are on a fixed income. Check out our resources on elder care planning if you want to learn more about how to navigate life after retirement.