THE PROBLEM

Millions of older adults—they could be our relatives, friends, neighbors, and even co-workers—are victims of financial exploitation every year.

These Crimes Have Devastating Consequences:

  • Seniors can lose much or even all of their life savings from a single scam
  • After being conned, seniors may not have enough left to afford daily necessities like food, transportation, housing, and medicine
  • Most seniors do not work and therefore cannot replenish money they lost
  • Money lost to fraud is often not recoverable
  • Being victimized by such crimes can cause emotional distress, isolation, and depression

Elderly Victims Usually Do Not Report Financial Abuse For A Number Of Reasons:

  • They may not know they were scammed
  • They are too embarrassed to tell others about it
  • They are scared the abuser may harm them or their loved ones
  • They do not know what to do about it or who to contact

Seniors Are At Higher Risk If They Suffer From:

  • Dementia or other cognitive challenges
  • Physical impairment
  • Isolation
  • Lack of trusted family members
  • Depression

KEYS TO PREVENTION

Fortunately, there are ways to guard against elder financial exploitation. Four Keys to Prevention are below.

Know What It Is

Elder financial exploitation is the illegal or improper use of an elder’s money, property, or other resources for the monetary or personal gain of another individual(s). It includes the use of deception, intimidation, or undue influence to obtain a senior citizen’s money or other assets.

While there are many kinds of financial scams, the main scope of Safeguarding Our Seniors is to focus those that are frequently used on the elderly.

Understand the Root Cause

Unethical individuals target older adults for three main reasons:

  • Scammers follow the money. Senior citizens often have nest eggs and other assets and receive monthly social security checks.
  • Scammers see the elderly as vulnerable, forgetful, and easy to manipulate, confuse and scare. They think they have a better chance of exploiting seniors as compared to other segments of society.
  • Senior citizens can be compromised cognitively and more likely to make bad decisions. Cognitive decline is a reality of older age, and medications prescribed for conditions like Alzheimer’s and Parkinson’s can cause impulsive decision making as a side effect.

Recognize Common Scams

Below are eight scams fraudsters commonly use on seniors:

This involves financial advisors who trick seniors into buying financial products that are not in their best interest (e.g., annuities, stocks, mutual funds, insurance policies). This scam is insidious because these advisors often work for bona fide organizations, like large insurance companies. They use the legitimacy of their companies to get their foot in the door with seniors—and then convince them to buy products for their own financial benefit, not the senior’s. One trick is a sales pitch that focuses only on the positives of a product without disclosing the negatives.

This scam happens when handymen or building contractors sell their services to seniors and require payments upfront—but then do not start or complete the work.

These schemes involve people using unethical sales tactics to sell health-related products. This is devious as seniors are often concerned about their health and willing to invest big money to improve it. A common example is a person or a website making extreme claims about a product’s health benefits—like a product that “reverses aging,” “cures diseases,” “does it all for older adults,” or “is a scientific breakthrough based on Nobel Prize winning research.”

Using fake names and credentials, fraudsters pretend to be employees of well-known companies or officials from law enforcement, the Social Security Administration, IRS, or some other government agency. They concoct stories—often using fear or high pressure tactics—and convince seniors to pay fines to get out of trouble or buy products under false pretenses.

Scammers pretend to be a family member of an elder—usually a grandchild—and ask for money. These scams often take place over the phone or via texts or emails. The imposters act like they are in trouble and need money urgently and confidentially.

Some scammers start romantic relationships with elders so that they can take advantage of them financially. They act affectionately towards them to gain their trust, and then begin to influence them in unscrupulous ways. Sweetheart scams are also perpetrated through online dating apps or websites. These scammers develop fake relationships online and through phone conversations. Once they gain their target’s trust, they begin to run their scams.

Telemarketers call claiming that the target won a lottery, a free vacation, or other type of prize. The fake reward can be hundreds of thousands or even millions of dollars or an exotic vacation abroad. Scammers ask for personal information and ask that the senior pays for shipping, insurance, and taxes on the “prize” with the promise to receive it after those costs are paid.

An unknown caller claims that the senior has a virus or malware on their computer, and convinces them to give remote access to fix the “problem.” They use this access to gather personal information, download malware, or convince them to buy a corrupt product or service.

Safeguard Seniors (and Yourself)

Below are tips that you can use right away to reduce risk:

  • Identify Red Flags:
    • Odd financial transactions (e.g., unpaid bills, checks made out to “cash,” cashing out of CDs, unusual use of credit cards, frequent trips to the bank)
    • Conversations about too-good-to-be-true investments or lotteries
    • Excessive or unnecessary products in the home
    • Sudden changes in your loved one’s daily routine, appearance, or buying habits
    • Sudden changes in communication style (e.g., secretive, withdrawn, defensive, anxious, unavailable)
    • Constant presence of a new companion who bugs your gut
    • Frequent purchases of gift cards or prepaid cards
    • Loss of valuables such as cash, watches, and jewelry
    • Signs of disorientation, confusion, or loss of memory of financial transactions
  • If you see warning signs, communicate and find out more. The sooner you learn about a possible scam, the more likely it will be caught early and prevented.
  • Talk about common scams with your loved one. Ask them to be cautious and to contact you or another trusted person before making major financial decisions. 
  • Provide them with educational materials such as newsletters and flyers.
  • Meet and get to know anyone providing financial advice to your loved one. Verify with the BBB and others that the person/company is legitimate.
  • Isolation increases the risk of scams. So encourage plenty of social interaction with family, friends, and neighbors.
  • Report fraud when you see it to protect your loved ones and others.
  • Be cautious! According to the FTC, scams usually have four signs.
    • Scammers PRETEND to be from an organization you know – like the IRS, Medicare, Police Department, or a well-known company
    • Scammers say there’s a PROBLEM or a PRIZE – like you owe money, are in trouble with the law, have a computer virus, or won a lottery or sweepstakes but have to pay a fee to collect your winnings
    • Scammers PRESSURE you to act immediately – they want you to act before you can think it through
    • Scammers tell you to PAY in a specific way – like getting a prepaid card and giving them the number on the back, writing a physical check out to “cash,” or sending money through a money transfer company
  • Remember that if something sounds too good to be true, it probably is.
  • Never make a financial decision quickly. Resist any pressure to “act now!”
  • Block unwanted calls and text messages.
  • Never give personal or financial information over texts or to random cold callers.
  • Build a good social network of people you like and trust.
  • Look at your credit card statements and bank statements closely. Be on the lookout for any charges or withdrawals you did not make.
  • Shred bank statements and credit card receipts before throwing them away.
  • Check the BBB and online reviews of companies to confirm they are reputable.
  • Talk with a trusted family member, friend and/or attorney before making major financial decisions. And consult with them before signing any documents.
  • Ask for identification/credentials to verify a salesperson’s identity.
  • Report fraud when you see it to protect yourself and others. 
  • You may have loving relationships with grandparents or other older adults and want them to be safe from scams. Talking about financial exploitation with an elder isn’t always easy though, especially for a teen. Initiate these conversations only if you have a close relationship with an elder and you are comfortable doing so. 
  • If you are comfortable, we recommend bringing up the topic casually instead of somberly.
  • If you are not comfortable but want them to be vigilant, you can talk with your parents about elder financial exploitation and ask them to talk about it with your grandparents.  
  • If you notice any Red Flags listed above, notify your parents about it.

A final tip for everyone: resources are available to help you at any time! If you or a loved one have been scammed or have an uneasy feeling that you are being scammed, click here for a list of helpful resources.

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