Alarming rise in elder fraud - up 74%: Internet Scambusters #1,032
Elder fraud - scams targeting the over-60s - costs Americans billions of dollars every year, and it's rising fast.
Crooks are exploiting older folks' accumulated wealth and sense of trust to steal on a vast scale using scams ranging from fake investments to bogus lonely-hearts.
In this week's issue, we explain the biggest risks seniors face and give you the single most important rule to spike the scammers' guns.
Let's get started…
The Number One Way To Prevent Elder Fraud
A sharp rise in elder fraud - scams and theft targeting older folk - is causing alarm across the US.
In its latest annual report, the Internet Crime Complaint Center (IC3) declares: "The number of elderly victims has risen at an alarming rate, while the loss amounts are even more staggering."
If you're in this population group or have older family members, would you be able to spot a scam and know what action to take?
The Scale of Elder Fraud Abuse
Scams and other forms of financial exploitation cost 3.5 million American seniors almost $1.7 billion last year. That's up 74% from the prior year, and security experts fear this year's number will be significantly higher.
And because seniors are afraid or embarrassed to admit they've been duped, the real figures are thought to be much higher, with losses perhaps as much as $3 billion.
The scale of individual losses is also worrying. While some younger age groups fall victim almost as often as older people, their losses run into merely the hundreds or thousands of dollars bracket, whereas the average amount scammed out of seniors is more than $30,000. In some widely reported cases, they've even been tricked out of hundreds of thousands or even millions.
Those aged 80 or over are the biggest losers.
The Most Common Scams Targeting Seniors
The previously mentioned IC3 report lists 28 con tricks that scammers use to target seniors.
One of the most worrying is the number of seniors being duped by romance scams - an area that has only come to the fore because of social media, online dating apps and, in some cases, the use and popularity of cryptocurrencies like Bitcoin.
Other big, elder abuse crimes include:
- Tech support scams. Because older folk tend to be less tech savvy than younger people, they're more easily taken in by messages, phone calls and on-screen pop-ups claiming their computers have been infected by a virus. Losses in 2021 were more than double those of the prior year.
- Timeshare sale and resale scams. Often with the time and money that allows for travel, and a misguided sense of trust that allows them to fall for a salesperson's patter, seniors are more likely to succumb to the exaggerated or even dishonest claims about the financial attractions of buying into a timeshare. When they realize their mistake, they're taken for a ride again by some (but not all) companies that claim to be able to get them out of the deal but which, in reality, just charge astronomical fees and do little or nothing.
- Imposter scams and identity theft. All of us are potential targets for scammers pretending to be from government, law enforcement, utility firms or distressed family members. But older folk may be more inclined to panic when told they owe money or that a relative is in desperate financial need. They're also especially vulnerable to scams relating to Medicare. Often, victims don't just hand over money they don't owe, but also confidential information that can be used for ID theft.
- Lottery winnings and inheritances. Although most of us know of this scam by now, the amounts scammed from older victims thinking they're on the receiving end of a big money windfall continues to climb, rising by about 40% last year.
- Investment fraud. Cryptocurrency has opened the floodgates to scammers who exploit two key facts: You can make big money, if you know what you're doing, and most investors don't know what they're doing! But that's just the tip of the iceberg. Crooked financial advisers are on the prowl for older folk struggling to manage their investments.
The Number 1 Way to Protect Against Senior Financial Scams
Awareness of scam risks is the number one way of protecting everyone from falling victim. Seniors who take the time to educate themselves about scams are less likely to fall victim. A simple shortcut is to read up on the topic, for example, the AARP book Outsmarting the Scam Artist. Of course, subscribing to Scambusters and other consumer champions will help keep you up to date with latest tricks.
Family members can also play an important role by drawing attention to the latest risks and monitoring the spending and activities of elderly relatives. For example, one thing older people tend to do without thinking is to pick up the phone every time it rings. Helping them to block calls and encouraging them to use voicemail could cut the risk of being caught out.
It's Not Just the Scammers
Before we go, it's important to note that elder fraud abuse isn't just about scams. Theft by family members and caregivers is a major concern. It takes many forms. For example - cashing checks without knowledge or approval, stealing money and other valuables, tricking victims into handing over money or responsibility for managing it.
If you suspect you or a family member is being tricked in this way, either by another family member or a caregiver, speak to an attorney or other trusted person.
In a recent alert, the FBI noted: "Criminals target people over 60 because they are often financially stable, more trusting, and less likely to report crimes. As the older population in this country grows, scammers are likely to continue targeting older Americans."
This Week's Scam Alert
Not Norton: Internet security firm Norton warns about fake emails pretending to come from them and warning recipients their account is about to expire or there's another security issue. Victims are asked to call a number where they're supposed to provide their sign-on details. Often the messages use bad spelling and threats. If you get one of these messages, go directly to your account at Norton.com and check there.
That's it for today -- we hope you enjoy your week!