Frauds & Scams
Every year, millions of adults age 65 and older fall victim to senior scams. The best way to avoid losing money or confidential information to a scammer is by learning to recognize the different types of fraud and when you may be the target.
Contrary to popular belief, recent data from the Federal Trade Commission shows that seniors are 20 percent less likely than younger people to fall for scams. However, when senior scams do occur, the median loss is often much greater.
Losing large sums of money as a senior is typically more detrimental than losing small amounts in your 20s, as most older adults are retired and living off of their nest egg rather than continuing funds from employment.
Once you understand the main warning signs and different types of fraudulent practices, you’ll be better able to protect yourself and maintain your financial wellness. Click the following link or the image below to learn more about identifying and avoiding scams:
According to the Better Business Bureau and the FTC, here's how you can reduce your risk of becoming a victim of telemarketing fraud: Be skeptical of "too good to be true" telephone offers Resist pressure for an immediate decision and ask for written follow-up materials that explain the offer. Agree to pay no more than the price of a postage stamp when notified about "winning" a sweepstakes.
All legitimate sweepstakes must allow a "no purchase necessary" way to play the game and collect the prize. Never provide your credit card or checking account numbers to a caller from an unfamiliar company without first checking the company out with the Better Business Bureau, state consumer protection agency or state Attorney General. Ask to be placed on the company's "do not call" list to reduce the number of unwanted telephone solicitations you receive. Learn more about how not to become a victim of telemarketing fraud (PDF).
Home Diversion Burglary
This scam usually occurs during the spring, summer or fall when residents are working outside. Most individuals working in their yard do not lock their homes. One individual will approach the victim and occupy his/her attention while a second subject enters the victim's home and steals cash, jewelry and silver.
Another home diversion technique is for perpetrators to come to a residence and ask for a drink of water, use a bathroom, or use a telephone for an emergency to gain entrance to a home. The subjects will then attempt to divert the victim's attention while an accomplice searches for valuables. If an unknown subject comes to your home seeking directions, the phone, the bathroom, etc., keep the subjects outside the home and at least one locked door between you and them. If they need water, direct them to an outside faucet. If they need to contact someone, offer to make the call for them. When working in the yard only leave a door unlocked that you can visibly monitor at all times.
The Pigeon Drop
In the most common variation of this scheme, a person is approached by strangers who claim to have found a large bag containing cash. The victim is convinced to put up "good faith" money to share in the find and is driven to his/her bank to obtain the money. The good faith money is then put in a purse or parcel for safekeeping The victim is then distracted while the parcel containing his/her money is switched. The bogus parcel is later given to the victim for safe keeping and the strangers leave to make final arrangements and never return Obviously, if a deal sounds too good to be true, it is. Anyone that asks for a person to put up money for "good faith" is not trustworthy.
Bank Examiner Scam
The con-artist portrays himself as a good Samaritan in this scheme and generally poses as a bank official, police officer, or FBI agent flashing a badge or other identification. The perpetrator requests the assistance of the victim in checking on an employee suspected of defrauding the victim's bank or indicates there is reason to believe the victim's records are inaccurate and should be checked. Once the swindler has the victim's confidence, he persuades the victim to withdrew large sums of cash from his bank account. The victim is then assured his money will be returned and the swindler will ultimately take the money, never to be seen again.
Real professionals have other ways to resolve investigations rather than involving innocent subjects. Each of these groups has their own officers and money for covert operations to check for bank fraud. If you are approached by any of these individuals, contact their employer to verify their employment. If the person claims to be a detective or FBI agent, ask the person for a uniformed officer to come to your location to verify their identity.
The perpetrator in this scheme claims to be from India, Africa, or another country, and has just inherited a large sum of money. He then displays a letter that states that under the law in their country he cannot return with more than a small amount of U.S. Currency. The swindler then solicits the victim's assistance and either asks the victim to keep the money and periodically send small amounts of it back to them in their home country or make a small donation.
In either case, the victim is given the impression that this person will return to their country leaving his money behind. The con-artist tells his victim that he trusts him; however, it will be necessary for him to prove he has money of his own so he won't be tempted to keep this money. When the victim withdraws a large sum of money from his bank, the money is placed into a handkerchief or envelope along with the con-artist's money and a switch is made. The victim is later given an identical envelope or handkerchief containing cut up paper and the con-artist departs never to be seen again.