According to the Federal Bureau of Investigation, senior citizens are particularly vulnerable to certain types of fraud. Scammers prey on the elderly for a variety of reasons. Below is a list of reasons why scammers target seniors, as well as the most common elderly scams, and how to avoid them.
What Are Common Scams That Target Seniors
According to a 2017 Federal Reserve study, the average net worth for American households headed by someone age 65 and older is $1.067 million — 1.5 times as high as the average for all households.
However, while many older adults are wealthy, many others are poor. A 2018 Kaiser Family Foundation report calculates that 14 percent of all seniors are living in poverty. Scams that target the elderly can be a disaster for people living on fixed incomes who can’t afford the financial loss.
Seniors are More Trusting
Rich or poor, senior citizens are often lonely. Many seniors are empty nesters whose kids have grown up and moved out. The older these senior citizens get, the more likely they are to become isolated as their friends die or move into nursing homes.
This loneliness makes seniors prime targets for telephone scammers. They’re often happy to get a call and willing to listen to whatever the scammer has to say. When older people have no close connections, it’s easier for con artists to form a bond with them and gain their trust.
Also, older people are often more inclined to trust strangers to begin with. People who grew up before 1960 were often raised to be polite and to assume other people are honest. This makes them less willing to interrupt a sales pitch or hang up on a scammer.
According to a 2018 report from the Federal Trade Commission (FTC), senior citizens are actually more likely to report scams than younger people. However, con artists know that even if their elderly victims report the crime, there’s a good chance they won’t remember the details.
Because memory and cognitive function often decline with age, older victims are likely to have trouble providing investigators with the details they need to find and charge the criminals. Adding to the problem, many people don’t figure out they’ve been conned until weeks or months after the crime took place. By that point, their memories are even hazier.
Some scams specifically target seniors who are known to suffer from memory loss. For instance, True Link Financial outlines a scam in which victims receive three free issues of a popular magazine, followed by a bill for the “subscription” they never requested.
Another scam involves calling up seniors to request donations to real charities. However, the fraudsters call several times over the course of one day, counting on the victim to forget about the earlier calls. They then pass on 10 percent of the money collected to the charity and pocket the rest.
Many health scams focus on seniors because they’re more likely to suffer from specific health problems. This makes them prime targets for fake remedies that promise to do a variety of things, such as:
- Treat or prevent cancer
- Treat arthritis
- Improve cognitive function
- Improve sexual function
- Reverse visible signs of aging
- Improve overall physical condition
Older adults are also vulnerable to scams that center on other needs they have. These include scams related to fake Social Security and Medicare representatives, fake investments to provide income in retirement, and cons that prey on the recently widowed.
Some of the most common senior scams include:
- Charity scams
- Funeral scams
- Government imposter scams
- Grandparent scams
- Internet scams
- Investment scams
- Medicare scams
- Reverse mortgage scams
- Romance scams
- Lottery or sweepstakes scams
- Natural disaster scams
- Social media scams
How to Avoid Senior Scams
The best way to defend against scams is to be aware of the common types of scams and how they work so you can be on your guard. Here are some general tips that can protect you from all types of scams, including the ones aimed at seniors.
Whenever someone contacts you out of the blue, whether by mail, email, or phone, be wary. Take the time to check out the business, charity, or whatever it is before trusting it with any of your money. This goes double for anything that looks like an unbeatable deal. If it seems too good to be true, it probably is.
Don’t Trust Phone Numbers
If your caller ID tells you a phone call is coming from a trusted business or organization, such as the IRS, don’t assume it’s true. Nowadays, it’s extremely easy for scammers to spoof a real company or organization’s phone number.
Protect Your Personal Information
Never give out any personal or financial information to someone who calls or emails you. This includes your social security number (SSN), Medicare number, banking or bank account information, home address, and credit card numbers. In order to prevent identity theft, provide this info only when you initiated the call yourself to a business you know is legitimate.
Read the Fine Print
Never respond to any offer without knowing all the details. Read all contracts and sales agreements carefully, including the fine print. This includes purchases you make online or from a TV ad.
Do Your Homework
Before agreeing to do business with any new company — including sales providers, investments, and charities — do some due diligence. Ask for the salesperson’s name, the name of the business, contact info, and their license number. Then, take the time to review the company’s website and check its ratings with the Better Business Bureau.
Take Your Time
Never make a financial decision under pressure. If a marketer tries to push you into spending or investing money before you’ve had time to do your research, hang up on them immediately.
Talk It Over
Before making a large investment, talk it over with someone you trust. If you don’t have a financial advisor, run the investment by a trusted friend or family member to see if it sounds reasonable.
Don’t Pay to Play
Don’t pay in advance for any service, such as home repairs. You have no guarantee the services will actually be provided. Never pay a fee to collect a prize that’s supposed to be free. Any sweepstakes or lottery that charges a fee to collect your winnings is guaranteed to be a scam.
Use Traceable Payments
Automatically be suspicious of any business or organization that requests payment in an untraceable form. For example, a wire transfer, gift card, or cash in an envelope. Stick to traceable forms of payment, such as credit cards and payment apps.
If you or a loved one has been the victim of a scam, report it. Contact your local police department to file a report, and file a complaint with the FTC. You can also notify the FBI about the scam through the FBI tips website. Even if it’s too late to recover your money, you can still protect others from the same kind of fraud.
How to Protect Older Relatives
Protecting yourself against senior scams is one thing, but protecting your older relatives is quite a bit harder. Monitoring all your aged parents’ mail, emails, and phone calls to screen out scams is awkward enough if you live with them. If you don’t live with them, then it is virtually impossible.
Of course, you can always lecture your relatives after the fact if they get scammed. You might even threaten to take over their finances if they aren’t more careful. However, according to AARP, this strategy is likely to backfire.
If you make them feel ashamed or scared of losing their independence, they’re less likely to admit it if they fall for another scam in the future. That makes it even harder for you to protect them.
AARP recommends the following approaches:
Talk to your relatives regularly about what kind of mail and phone calls they get. If you hear about lots of calls or messages that are obvious scams, it could be a sign they’re on a sucker list. They — or you — will have to be extra vigilant about guarding against fraud.
Unlist Their Phone Number
Help your parents unlist their home phone number so scammers can’t get it as easily. Also, take steps to reduce robocalls, such as using a call-blocking registry or app.
Cut out Junk Mail
Another way to reduce your relatives’ exposure to scams is to help them get less junk mail. For a small fee, they can register with DMAchoice to block direct mail from legitimate vendors. That way, they’ll know any sales pitches that still make it into their mailboxes are likely to be scams.
Check Credit Reports
If you can’t persuade your relatives to check their annual credit reports, check them yourself on their behalf. It will enable you to spot any new, fake accounts opened in their names and close them before too much damage is done.
Explain the Scam
If your relative tells you about an offer that sounds like a scam, don’t say, “That’s a scam” and tell them to hang up the phone or toss the letter. Instead, explain to them how you can tell. For instance, point out that you can’t win a contest you never entered, or that government agencies don’t need to ask for your SSN because they already have it on file. Information like this helps arm your relatives against future scams.
Use Reverse Psychology
If you see a parent putting money into something that seems like a scam, such as a “guaranteed” high-yield investment, try asking how you can get in on the action too. According to psychologists, parents who are willing to put their own money at risk sometimes become warier when they see a child doing the same. If they warn you of the investment, you can ask why they’re willing to risk their money on it. Talking it through with you can help them recognize the investment as a scam.
Don’t Blame the Victim
If a relative has become the victim of a scam, don’t put the blame on them or make them feel stupid. Instead, put the focus on helping them avoid these scams in the future.
Help Them Help Others
If parents are unwilling to share the details of a scam they’ve fallen for, explain how their experience could help stop the scammers from victimizing others. Telling their story could be the key to catching the scammer or stopping them from striking again. You can make them feel like heroes instead of hapless victims.
If your parents have fallen prey to senior scams in the past, consider asking for online access to their bank and credit card accounts. It will allow you to keep an eye on them and spot any unusual or suspicious activity.
Additional Reading: Scams and Safety – fbi.gov
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