According to the Senate Special Committee on Aging, American seniors lose almost $3 billion annually to financial scammers. The Federal Trade Commission puts the median amount stolen at between $600 to $1,000 (the lower figure for seniors aged 70 to 79, the higher figure for seniors over 80), but there are many cases where people lose much, much more—hundreds of thousands of dollars and sometimes their entire life’s savings.
The people who perpetrate these crimes are the worst kind of criminals—people who take advantage of peoples’ vulnerabilities in a most heinous example of “preying on the weak.”
The best way to stay safe from such financial predators is to get up to speed on what kinds of scams are out there, the kinds of language to look for, and how to handle the situation if you are targeted. As the saying goes, forewarned is forearmed.
Why Con Artists Target Older Adults
Older adults are targeted by telemarketing scams for a variety of reasons, some logistical and some emotional. Here are a few of the key attributes that make seniors such attractive targets for con artists looking to commit financial fraud.
- They are most likely to have a nest egg. Older people often own their own home, have paid down debt, and have excellent credit. This means they have more liquid assets at their fingertips for scammers to access.
- They may have money problems. On the other hand, many have serious financial troubles, which can make them more susceptible to falling for scams that promise huge returns with little risk or investment.
- They grew up in an era that valued good manners and encouraged people to be trusting. The generations who grew up in the 30s, 40s, and 50s tend to be more trusting and are more concerned about being polite, even with strangers who are trying to extort money from them. They will not always feel comfortable asking questions, which helps the con artist avoid close scrutiny.
- They may be suffering from the effects of age on memory or cognition. Older adults who suffer from dementia may have trouble discerning what’s real from what’s not, even mistaking a scammer for a family member. Even older people who don’t have specific neurological conditions may have trouble remembering details, which makes them poor witnesses in legal cases against scammers.
- They are often very interested in learning about products that make big promises about health or financial rewards. When people start to feel desperate about something, they are more likely to hear what they want to hear and believe even the most fantastic claims. Criminals use this fact to lure seniors with promises of being able to improve cognitive function, physical strength, or stave off age-related diseases.
- They may be lonely. Isolation is a very real and dangerous part of aging for many Americans. Without regular social contact with family or friends, seniors are more easily influenced by scammers who cultivate false relationships in order to get close to and manipulate their victims.
- They may not be capable of standing up for themselves. Finally, the tactics of many scammers involve hardline bullying techniques designed to wear people down or even scare them into providing financial information or payments.
4 Common Scam Tactics
Con artists use a wide variety of ploys and techniques to steal money from people. Here are a few of the scams that were most prevalent in 2019:
Impersonating the IRS (or other government agency like the Social Security Administration)
According to the Treasury Inspector General for Tax Administration, this scam has robbed taxpayers of more than $72.8 million since 2013. These calls can either be threatening—telling the senior that they must hand over private financial information or face penalties or legal action—or pretend to be helpful by offering, for instance, to activate a suspended Social Security number. Using modern technology, sophisticated criminals can “spoof” actual government agency phone numbers so that it looks like the call is coming from a legitimate source.
Impersonating a Grandchild
This con has been around for ages and involves the caller pretending to be the individual’s grandchild who is in dire need of cash due to a car accident, other medical bills, or legal trouble. While the details may vary, the end game is the same—get the person to send money by wire transfer, gift card, or even by sending cash via the U.S. Postal Service. This scam aims to take advantage of older people who may be suffering a loss of cognitive function due to dementia or general aging.
The FCC found that the number of sweepstakes scams increased almost 46% between 2013 and 2017, and many of these scams originate from Jamaica. The ruse is simple—the con artist tells the senior that they’ve won a lottery, but can only collect their winnings after paying a fee. Sadly, although this con has had a lot of press, it still manages to fool a lot of people.
A newer ploy of scammers is to impersonate a support person from a well-known computer company like Microsoft or Apple. In this con, the scammer claims to be calling to help the victim remove a virus from their computer. The caller will then ask for personal information or bank account numbers.
And these are only a few of the many, many different cons that criminals use to separate seniors from their money. Other methods include things like contacting a senior through a dating site, developing a relationship, and then asking for money under false pretenses. Or, in a ploy that adds insult to injury, there’s the scam that targets people who have already been victimized. In this con, the scammer claims to be contacting the victim to help them file a claim to recoup their lost money.
Tips for Staying Safe
Staying safe isn’t always easy. Mostly it has to do with paying attention, not making any quick decisions, and almost never giving out personal or financial information over the phone. Here are a few common warning signs to watch for:
Listen for these key phrases, which are swindlers’ stock in trade:
- You must act now/Only available today/There isn’t time to think about it
- You can’t afford to pass up this offer/opportunity
- There’s no risk
- You’ve won a free prize, but in order to redeem it you have to pay …
- You have to pay (by credit card, digital bank transfer, or courier pickup) before we can provide services/products
- If you don’t give me the information I need, there will be dire consequences (from the IRS, Social Security, a credit card company, etc.)
Unfamiliar Companies or Organizations:
It’s always a danger sign when the person is unwilling to provide details about their organization such as a website, address, phone number, etc. It’s safest to only buy from and interact with companies that you know and trust. Be aware, however, that sophisticated scamming operations sometimes create entire websites made to look like official organizations. Always check your sources directly. Just because it’s on the internet doesn’t mean it’s real.
Paying for something “Free”
If it sounds too good to be true, it probably is. Many fraud tactics involve telling the victim they’ve won something (a lottery, sweepstakes, etc.), but in order to collect their prize, they have to pay taxes or processing fees. Similarly, scammers may offer highly valued products or services for “free,” with the caveat that the buyer must pay shipping and handling or other administrative fees. Any time someone asks you to pay for something that’s supposedly free, that’s a bad sign.
The Bottom Line: Stay Vigilant, Ask Questions, Take Your Time
Telemarketing fraud works because it feeds on people’s fears and hopes. Using threats and promises and other types of manipulation, con artists try to catch people in a weak moment. But you can avoid falling into scammers’ traps by following a few simple, logical steps:
Stay Vigilant —Refuse to take anything at face value or accept a stranger’s word as truth. You should listen for that red-flag language, and if they hear it hang up.
Ask Questions — Criminals hate questions. If you start asking direct questions, the scammer will often just hang up to try their luck elsewhere.
Take Their Time — Perhaps the most valuable advice is to avoid making quick decisions or commitments. No legitimate company or other organization will require immediate action or information. Sometimes, the best defense against possible fraud is just to take a moment to think things over and maybe talk with a trusted family member of friend about the situation.