Common Elderly Scams & Fraud Tactics You Should Know
Every year, it’s estimated that seniors lose $2.9 billion to scammers that cheat them out of their money. Impersonating the IRS, posing as charities, robocalls, claiming fake accidents to their loved ones and more, fraudsters target the elderly in a number of ways to exploit their naivete, snag some cash, or steal their identity. Even worse, instances of fraud among the elderly are under-reported. Attorney General Derek Schmidt claims that only 1 in every 24 cases of elder exploitation is reported and documented.
What makes the elderly such a common target, and how can we protect our loved ones? What fraud tactics do scammers employ, so that we can know a sham when we see one? We’ll cover everything you need to know so you can be better prepared when it comes to identifying impostors and schemes.
Why are the elderly targeted?
Seniors fall victim to scammers more than any other age group, and there’s a few reasons why. First, the aging population grew up with much less technology than what is at our fingertips today. Their lack of tech-savviness makes it difficult for them to recognize what channels should be used to communicate certain sensitive information. For example, the IRS mainly delivers notices to taxpayers through regular mail, and rarely by phone or text. Seniors who lack that judgement may receive a call from someone impersonating an IRS official and think it’s legitimate. The unfamiliarity with modern tech makes seniors more gullible, and thus more vulnerable to scams.
Not only are seniors more naive, but many live alone or are limited due to declining physical or mental abilities. Living with less mobility or access to others can lend itself to a lonely and isolating environment. When someone feels alone, any attention or company is welcome, including phone calls from complete strangers. The elderly are generally more willing to listen, patient, and more trusting as a result. These traits, coupled with their higher financial savings, make seniors an easy mark for fraudsters.
What are the different types of scams out there?
Most scams occur over the phone or computer and can impersonate a number of individuals or organizations. Below we’ve rounded up the most common scams and what they entail:
Health Insurance Scams
In the U.S., every citizen over the age of 65 is Medicare-eligible, making it an easy topic to abuse since scammers don’t need to do much research on private insurance providers. Health insurance scams are usually carried out over the phone, but can also occur at your doorstep.
Solicitors typically claim to be a Medicare representative and use a number of baiting tactics such as:
- Asking for their social security number in order to receive a new Medicare card
- Requesting their personal information to bill Medicare and pocketing the money for themselves
- Running fake mobile clinics where they provide phony “medical services” and use their information to bill Medicare and cheat them out of money
Phone scams targeting U.S. citizens are extremely prevalent, with nearly 49 billion robocalls placed in 2019. Telemarketing scams employ different tactics and scenarios to lure in the elderly.
The Pigeon Drop is a trick where the fraudster informs the individual that they’ve come across a large sum of money and are willing to share their profits with the individual. The only catch is that the individual hands over a certain amount of personal funds as a “good faith” measure. Usually, there is another con artist in on the trick, often posing as a lawyer, banker, or reliable intermediary to gain the individual’s trust.
Individuals will receive a phone call claiming that someone they know has been in an accident. Scammers will say that the individual’s loved one is in the hospital, and needs emergency funds for their care. The con artist will often pressure the individual without verifying any information. Like the Pigeon Drop scheme, for this scenario the fraudster involves another scammer who poses as an authority figure, such as a police officer, doctor, or lawyer, to appear more convincing.
Robocalls are automated calls that attempt to lure the individual into saying “Yes” through a number of questions, such as asking “Are you there?” The goal in this scheme is to record the individual’s response “yes” and use their voice to place charges on credit cards and gain access to other information.
Fraudsters prey on victims by posing as a charity seeking donations for disaster relief efforts, veterans foundations, and other causes. Scammers will go so far as creating a website for their fake non-profit, and will try to appear as legitimate as possible with well-designed marketing materials. Charity scams tend to occur more frequently around the holidays, and after a natural disaster happens.
Internet fraud takes advantage of elderly people’s lack of tech savviness through pop-up windows and internet notifications of anti-virus software. Through simulating anti-virus scans and luring individuals into downloading fake anti-virus programs, scammers can access personal information stored on their computer.
In other cases, scammers will call claiming to be tech or computer support, and offer to scan their computer or device for a “senior citizen discount”. Luring elderly individuals in to give up their payment information, con artists will access personal information and either disappear or download bogus software to the individual’s computer.
Phishing attacks over email, text, and other methods are prevalent in the U.S. and claim millions of dollars from victims each year. With phishing, scammers pose as a reputable company, such as a bank, credit card company, or online store that you’re familiar with and trust. They’ll send an email or text message looking as if the correspondence is from this company, tricking the individual to open a link or provide their personal information. They ask recipients to do this in a number of ways, like saying they need to update their payment details, confirm personal information, or offer a coupon.
Lottery & Prize Scams
Scammers call an individual informing them that they’ve won a prize or large sum of money like a lottery. However, in order to free up the grand prize, individuals must pay “taxes and fees” first. Once someone falls for this scam, the fraudster disappears with their money or sends a check that bounces.
Scammers pretend to be one of the individual’s grandchildren, often tricking elderly people into guessing who it is. Con artists will call a senior and ask “Grandma, do you know who this is?” and let the individual guess which “grandchild” is on the phone. The scammer then plays along, pretending to be that grandchild, and proceeds to ask for money for an emergency. Sometimes, scammers will even go so far as to say “Please don’t tell my parents” to ensure there’s no chance of getting caught.
Financial Advisor Scam
Fraudsters call the individual pretending to be a financial advisor to access their retirement funds. Once they gain access to their savings, they take their money and disappear.
This list is not exhaustive. Here are some other fraud tactics you should know:
- Counterfeit prescription drugs
- Anti-aging products
- Pyramid Schemes
- Census Bureau
How do I protect myself and loved ones from scammers?
There are some easy ways you can identify scams and protect your personal information. The number one rule? Educate yourself. Read about current scams going around and familiarize yourself with the channels legitimate companies and organizations should be communicating through. By understanding the common tactics and scenarios con artists employ, you can raise a flag when you receive a phone call or mail that seems suspicious. When in doubt, take extra steps to verify the identity of the caller. For example, if you receive a call claiming to be a charity, check with the Better Business Bureau before providing a donation. You can also access free additional resources and information about protecting yourself from AARP’s ElderWatch website.
Finally, reporting scams can help inform others and investigate the parties carrying out the schemes. Here are a number of ways to report scams:
- Forward phishing emails to the Federal Trade Commission (FTC) at firstname.lastname@example.org
- Contact your state consumer protection office to report fake charity scams and other fraudulent consumer products
- File a complaint with the FTC
- Report fake checks in the mail to the US Postal Inspection Service and/or FTC
- Submit your complaint to the Better Business Bureau Scam Tracker
If you receive a phone call, email, personal visit, or letter that seems the slightest bit suspect, trust your gut and conduct a quick search on Google. Usually scams are documented online and Google should be able to provide an answer, however not always. We strongly recommend that you and your loved ones stay educated and aware of the scams out there to safeguard your information, identity, and finances.