Scams are a commonplace part of 21st century life. Unfortunately, in the digital age, it is easy for scammers to get access to our information and use it to sell ideas that are harmful. Famous examples of scams include the Nigerian email scam (which asked victims to send money overseas with the promise of the money being returned plus interest), weight loss scams that promise huge results in small periods of time if you only spend hundreds of dollars on pills, and phishing scams which find your information as you use the computer, especially for online purchases. These can affect anyone at any time, and can result in the loss of thousands of dollars. Many scammers seek to target specific groups of people in our society that are most vulnerable--children, those who have limited intellectual ability or development, and seniors.
Most of the resources in this article come from the Federal Bureau of Investigation, or FBI, whose work to combat fraud extends to offering many tips to protect yourself or your loved ones from scams. These tips are backed up (and often repeated) by the Consumer Financial Protection Bureau (CFPB) and National Council on Aging (NCOA), amongst others. Following their suggestions and making sure seniors understand these tips will go a long way toward ensuring that scammers do not get a hold of their information or money.
Seniors are vulnerable to healthcare promises...
The FBI notes that seniors are targets for scams for several reasons. For one thing, they may have assets, such as the equity in their homes, savings or retirement nest eggs, good credit, healthy checking accounts, et cetera. For another--and this is something scam artists count on--age often affects memory negatively, and older people are more likely to be afflicted with dementia or other cognitive difficulties. This makes reporting details, or even realizing one has been a victim of a scam, more difficult and time-consuming for them. Seniors are vulnerable to healthcare promises, which also makes them attractive targets to scammers, says the FBI. Many seniors are interested in alternative healthcare treatments or medical equipment that purports to cure diseases such as cancer, Alzheimer's, or diabetes. The FBI notes also that social expectations, for many seniors, require them to be polite and accommodating to strangers. This may make them more trusting of people's intentions and more reluctant to challenge the scam artist's credibility or to state a firm refusal and cut off a smooth- or fast-talking scam artist.
The Internet may be a danger zone for seniors. Often seniors have a lack of familiarity with digital resources, which may mean that seniors using computers and the Internet are more likely to give away unsafe information, and also may not be using enough software to protect themselves.
Beyond that, many seniors are unaware of the sophisticated nature of scammers today. This leaves them vulnerable to predators.
There is plenty of anecdotal evidence to support people taking advantage of the elderly. Whether they choose to exploit them through Medicare coverage, spyware, telemarketing, fake medical cures or treatments, or real estate scams, these scammers are relentless in their pursuit of victims, and they are willing to take everything they can.
Big Financial Schemes that Target Seniors
Schemes come in all shapes and sizes. Some affect only a few people, some affect thousands. Some seek a few dollars from unsuspecting victims; others aim to get millions. But there are specific kinds of schemes that affect and prey upon seniors. Knowing what they are, how they commonly operate, and how we can work with seniors to protect themselves will decrease the likelihood that scammers will be able to harm them.
There are many ways that scammers fool their victims into giving away their information, but a popular way is to capitalize on the confusion some feel in regard to new healthcare legislation. Callers will find a senior's telephone number and pose as Medicare or Healthcare.gov employees searching for information or announcing a problem with the person's insurance coverage. Once they have the person's account information, they can access all kinds of data and make false claims to the person's insurance or even track down a bank account number.
The Women's Institute for a Secure Retirement (WISER) notes that medical fraud may also take place when a provider bills you for a more complicated or expensive procedure, or one that was not performed at all. Many bill Medicare or other insurance providers without the victim of the scam even knowing, and it results in Medicare paying money to scammers (leaving less money for necessary programs and medicines) and the victim often paying a portion of money they didn't actually need to pay. Without careful review of medical documents and transparency and documentation from medical professionals, this type of fraud can happen easily and frequently, with everyone but the scammer losing money.
Similar to Medicare scams that cold-call seniors in order to capitalize on confusion involving changes in healthcare law, telemarketers use the confusion over what is legally promised by a sales call to rip off seniors. By promising items for sale, taking credit card or bank account information, and then never shipping the item, these scammers make sure they take as much money as quickly as possible.
This happens using internet resources as well. Take, for example, the evidence unearthed by YouTube filmmaker Jack Vale, who called the number listed on a website that came up when he mistyped a web address. The company claimed to be available to fix his computer, despite there being nothing wrong with it. He posed as an elderly couple, showed clear signs of confusion and distraction to the salesperson, and was asked for his credit card information, $399, and for him to grant them access to his personal computer for up to eight hours while the company remotely "fixed" a problem that did not exist.
A good rule of thumb for seniors is that whenever there is pressure to act quickly or without proper and reasonable consideration, there is a good chance they are being approached by a telemarketing scammer. The FBI notes that being pressured to act now or lose a chance at the offer is a common tactic. Being pressured to send money, give a credit card or bank account number over the phone, or to write a check to be picked up by someone are tactics respectable companies do not use. The caller may also be dismissive of the senior's expressed wishes to talk things over with friends, family members, or the Better Business Bureau.
Reverse mortgages are more popular now than ever, increasing 1,300% between 1999 and 2008 (FBI.gov). Their sudden spike in popularity, but relative obscurity when it comes to the public's knowledge of how they work, leaves many seniors vulnerable to scammers posing as people offering these options.
These scammers may cold-call and offer these fake services...
Seniors are offered real estate or property gains, such as a free home or assistance with refinancing a home. Once they have enough account information, scammers will take money from seniors and use it for their own projects. Seniors do not see a return on this investment or may find their bank accounts cleared of all cash. These scammers may cold-call and offer these fake services, or they may encounter scammers posing as legitimate professionals through churches or through free investment or retirement seminars, says the FBI. They may also use trusted advertising venues, such as televisions or radio ads, direct mail campaigns, or advertisements on billboard.
How to Protect Yourself and Your Loved Ones
The FBI and Consumer Protection Bureau have specific lists of how to avoid scams of various types. Utilizing these tips and tricks will help you and your loved one avoid being taken advantage of by scammers.
The FBI has several tips on how to avoid healthcare-related fraud for seniors. They advise that seniors not sign (or authorize others to sign on their behalf) insurance-related forms without ensuring that they understand the content of the forms. Having them reviewed by another professional or legal help is advisable. This transparency should also extend to doctors; asking what kinds of procedures will be performed and what they will cost before agreeing to them, and having them documented in writing, will help avoid fraudulent treatment or procedures from medical professionals. (Medical professionals should be happy to provide more information and documentation on any medication, treatment, or procedure. Anyone who does not wish to share information about any medical procedure is a potential scammer, says WISER.)
Insurers should be happy to answer questions, just like other businesses; anyone who calls and claims to be from an insurance company but cannot or will not answer questions is not, the FBI says, a trustworthy person. By the same token, you should be wary of anyone selling "free" services or claiming that your insurance will cover equipment or procedures unless they are from your insurance company. Door-to-door salesmen, the FBI says, may claim to be giving you free items which are not actually free.
Avoiding telemarketing fraud can be difficult because it allows scammers to interact directly with their victims in a way that makes them seem less likely to be the villains they are. Scammers are often very charismatic, and will even sound kind over the phone despite their intentions. The FBI says to always check out unfamiliar companies with your local consumer protection agency, Better Business Bureau, state attorney general, the National Fraud Information Center, or other watchdog groups. Unfortunately, not all bad businesses can be identified through these organizations.
The FBI also advises that you obtain a salesperson's name, business identity, telephone number, street address, mailing address, and business license number before you transact business. Some con artists give out false names, telephone numbers, addresses, and business license numbers. Verify the accuracy of these items.
Look for suspicious activity surrounding money. Anyone that needs to send a messenger or courier, demands payment before services are rendered, or wants your credit card information to periodically charge you is suspect. A way to make sure you or your loved one is not being scammed is to check bank accounts and credit scores regularly online, which will allow you to spot financial fraud and dispute claims, says the AARP. The CFPB seconds this claim and adds that sudden changes in financial ability--a lack of funding for bills or medications, for example--could be a sign that someone is taking advantage of a senior.
Paying for any service or good with a check or card allows the money to be traced. If you pay with checks as opposed to cash and you are scammed, investigators can trace the money to the account into which it was deposited, says WISER. This means that they can catch the scammer more readily than if payments are made in cash and therefore remain virtually untraceable. This may be dangerous, however, because payment via check or card means that the scammer will have your account information and could make fraudulent charges, so be on the lookout for unauthorized changes to your account after purchases from a new salesperson, business, or medical professional.
Set limits on budgets, information, etc. If you know you will not give your bank account information over the phone under any circumstances, and someone calls to ask for it, refuse to give it out. If someone calls to sell something and it isn't in your budget, do not even take the risk of being scammed. Also know the difference between a trusted business and an unknown one; a doctor's office calling for payment of a bill and can verify who they are and why they are calling.They could simply be trying to make it more convenient for you to pay. However, if anyone declines to give more information, verify their identity, or give you time to make a decision, they are likely a scammer. Using social pressure and forcing you to "feel rude" by avoiding them or making them wait or by asking them to repeat themselves so you can better understand their message, is one way scammers pressure seniors to give them money and information. Anyone that cannot take "no" for an answer or becomes rude in the face of it is a scammer.Beware of fast and smooth talkers too. Some scammers inundate a person with rapid-fire information until the person is too confused (and ashamed to admit he or she does not understand) to say no. Others prey upon senior's loneliness by offering friendliness and interest that seem sincere but is only proffered to get the senior's money.
...legitimate vendors won't be calling or sending junk mail...
If you have information about a fraud, report it to state, local, or federal law enforcement agencies. The NCOA and AARP suggest that you also put yourself on the Do Not Call list, which means that legitimate vendors won't be calling or sending junk mail. That means that people who do are definitely not legitimate. This list means that telemarketers are not allowed to contact you! They may still attempt to do so, but you can very easily reply with the fact that your name is on the list, and politely hang up.
Something that sounds too good to be true very likely is not true at all. Anyone who calls, emails, or mails you advertisements is looking to sell something. They are not just good-hearted folks looking to offer a helpful service. Do not sign anything you do not understand; the pressure to sign or agree immediately is part of a scam. Allow yourself time to review terms and conditions, consult with a lawyer, see another financial officer, or make calls to family members/caregivers. Trust a financial adviser by their credentials and not by their personality. Do your homework on them and their certifications before deciding to invest through them..
In general, the Consumer Financial Protection Bureau has four simple steps to follow regarding scammers, especially when you are a caregiver educating and protecting a senior from scams:
Another important note from the CFPB is to take into account that not all scammers are strangers. Unfortunately, caregivers and other family members are often involved in financially abusing and scamming seniors, many as a result of mental instability or substance abuse addiction. If you know someone close to your senior that may be victimizing them, keep a close eye and report misconduct. (Many seniors choose not to report this type of abuse because they do not wish to harm a family member, so keep in mind that this can and likely will cause tension!)
The National Council on Aging also suggests that seniors who are less socially isolated are less likely to be taken advantage of. Make sure that your senior gets as much social interaction as they can, either within a facility, amongst family members, or with the larger community, since this means they are more likely to feel confident and respected. This means that scammers will have a hard time making them feel obligated to follow commands or suggestions, since their self-esteem will be high.
If your loved one is a potential victim, do not shame them for being confused by a scammer...
Remember also that being scammed is often a shameful experience. If your loved one is a potential victim, do not shame them for being confused by a scammer, says AARP. Avoiding victim-blaming (blaming the senior themselves for being scammed) is important; it is not the senior's fault that, no matter how clear the scam may be to you, someone else decided to take advantage.
Taking these steps and following tips from the FBI, CFPB, AARP, and NCOA should ensure the safety of your loved one's financial assets, but always be on the lookout for new types of scams, especially ones that take advantage of possibly age-related confusion in the elderly. Watching the news and regularly checking various organization's fraud resources will alert you to potential threats and how to protect your loved one from them, so get on mailing lists and talk to others in your community about any strange phone calls or particularly suspect persons in the area. An overall vigilance and communal reporting can take a scammer from a threat to a nobody in no time.
Federal Bureau of Investigation (FBI). Common Fraud Schemes. Available at https://www.fbi.gov/scams-safety/fraud. Retrieved February 17, 2016.
Karp, Naomi and Freeman, Iris. C. (August 26, 2014). Tips and Tools for Protecting Residents from Financial Exploitation. Consumer Financial Protection Bureau. Webinar. Retrieved February 17, 2016.
Kirchheimer, Sid. (August 20, 2013). Protect Your Parents From Scams. American Association of Retired Persons (AARP). Available at http://www.aarp.org/money/scams-fraud/info-08-2013/protect-your-parents-from-scams.html. Retrieved February 17, 2016.
List25.com. 25 Most Popular Scams You Should Watch Out For. Available at http://list25.com/25-most-popular-scams-you-should-watch-out-for/2/. Retrieved February 17, 2016.
National Council on Aging (NCOA). How Seniors Can Protect Themselves Against Money Scams. Available at https://www.ncoa.org/economic-security/money-management/scams-security/protection-from-scams/. Retrieved February 17, 2016.
Vale, Jack. Scamming the Elderly Online. Available at https://www.youtube.com/watch?v=tjTim5OR3dI. Retrieved February 17, 2016.
Women's Institute for a Secure Retirement (WISER). Protecting Your Income: Tips for Elders. Available at http://www.wiserwomen.org/index.php?id=173&page=Protecting_Your_Income:_Tips_for_Elders. Retrieved February 17, 2016.