Retirement Planning, Elder Law, and Senior Finance

8/10/2021 | By Annie Tobey

Your caller ID says the U.S. Drug Enforcement Administration is calling, so you pick up. The caller says he is a D.E.A. agent and claims your bank records were found. Inside a car. Far, far away. And with your bank records was a stash of illegal cocaine. So you’re in big trouble! The only way to clear your “criminal” record is to send cash. By mail. Immediately. Oh, dear! A senior Virginia woman received such a call and was swindled out of more than $400,000. Seniors – or anyone interested in protecting seniors from scams – should learn the risks and tips for resisting scammers.

Masterful manipulators

Even many intelligent and skeptical individuals have been targets and victims of these savvy scammers.

In 2020, the Federal Trade Commission received more than 2.1 million fraud reports from consumers in 2020. That’s a lot of shysters looking to rope in innocent people. Although not all fraud was successful, Americans lost more than $1.9 billion to fraud and scams in 2019.

Early this year, a fraudster who had been nabbed by the FBI pleaded guilty to conspiracy to commit mail and wire fraud and aggravated identity theft. According to the Richmond Times-Dispatch, the U.S. attorney’s office said of the crime:

Conspirators defrauded more than 4,000 victims of over $10 million dollars. Thousands of victims wired money in amounts ranging from $300 to $3,000. Those victims believed that they had been approved for personal loans and were making first payments or providing earnest money.

Other victims were tricked or coerced into believing that there were outstanding warrants for their arrest, or that their Social Security benefits account had been emptied, or that they had substantial unpaid tax liabilities. More than 180 of those victims shipped parcels of cash to addresses they believed were associated with the U.S. government. Those cash shipments typically ranged in amount from $5,000 to more than $100,000. The total losses from these cash parcels exceeded $5 million.

“These are sophisticated scammers who set up transnational fraud operations using methods that have been refined and perfected over time to prey on vulnerabilities and threaten victims into compliance,” Raj Parekh, acting U.S. attorney for the Eastern District of Virginia, told the Times-Dispatch.

“If this is your first encounter with this type of sociopathology, the most dangerous thing you can do is think you’re too smart to fall for it,” warns Bob Sullivan, host of AARP’s The Perfect Scam podcast told tech columnist Jennifer Jolly, after Jolly’s mother had been scammed. “They’re really good at these quick emotional flips and putting you in a panic state very quickly. That’s when you’re ripe for the taking.”

The vulnerability of seniors

Although we all are vulnerable to being duped, seniors can be especially gullible; and protecting seniors online is particularly important.

“Data suggest that, as we get older, we become more vulnerable to fraud in so many of its forms,” reported David Brancaccio on Marketplace. Even people who “have no diagnosable cognitive impairment … may still be at special risk from those who want to take their money.” Similar research published by the Brookings Institution revealed that the peak age for handling money matters was 53 years old.

One of the victims in the recent FBI case was a woman in her late 60s. She withdrew $238,400 in cash from her accounts and sent out $23,000 in gift cards. In all, she lost 95 percent of her savings. “I can’t tell you how deeply ashamed I feel because I’m a smart person,” June said, “but smart people supposedly don’t let this happen to themselves.”

The BBB Scam Tracker shows the prevalence of the issue across the nation.

Loneliness factors in when some older adults fall prey. Peter Lichtenberg, director of the Institute of Gerontology at Wayne State University in Michigan, told Brancaccio that 20 percent of older people talk to others about money because they’re lonely. “That is, people might engage with a scammer because they want to talk to someone, anyone.”

To add to their “appeal” to scammers, older adults typically have greater financial resources.

Although not all older adults are at risk, it’s wise for vulnerable seniors to be aware and take measures to avoid being duped – and sometimes for their loved ones to help safeguard them.

7 Common Senior Scams

Protecting seniors from scams if you’re concerned

Boomer writer Ray McAllister’s mother fell for the grandparent scam. She bought and mailed $2,000 worth of gift cards to help her grandson who had been in a car accident – or so she thought. “The whole event made me angry,” McAllister recalled later.

Angry, for sure, at the scammers. But angry at my mother, too. We had talked often about scams. She knew when someone says you’ve won a cruise, you haven’t won a cruise. You haven’t won the lottery. When someone calls to give you a credit card or ask for donations, you hang up. She knew.

Yet she gave $2,000 in gift cards to someone so her grandson can leave South Carolina. Who does that?

A lot of people, it seems. The mother-in-law of a friend was scammed twice by her ‘grandson,’ each time for thousands of dollars. Twice!

Are you concerned that your senior loved one could be scammed? Keeping them safe from fraud and respecting their autonomy can be a challenging balancing act. Ideally, you should begin taking safety measures while they’re still aware of the dangers and of their own increasing vulnerabilities.

Here are steps to consider in protecting seniors from scams, depending upon how vulnerable they are.

  • Help them understand the significance of the problem.
    • Show them this article, so they can see statistics, stories of everyday people who have been duped, and the vulnerabilities of all people – especially seniors.
  • Visit or call regularly to be attuned to suspicious changes: long-distance relationships, possible secrets, etc.
  • Suggest a mutual reporting pact. You will call them if you get a suspicious contact, and they will likewise call you.
  • Stop, drop, and roll. When tech writer Jennifer Jolly’s mother was swept up in a tech support scam, Jolly got advice from Sullivan of the AARP podcast. Sullivan advised, “‘Whenever you’re in one of those moments where you think, ‘Oh my God, something terrible might be happening,’ stop what you’re doing. Drop the mouse, and roll your chair away from the desk.’ Then, call someone you trust.”
  • Block unknown callers and screen incoming mail.
  • Set up safeguards on bank and credit card accounts. Financial institutions can set limits on debit and credit card purchases and notify you or another trusted advisor of irregular activity, such as large or frequent withdrawals.
  • Arrange for more formal account oversight. The web and app-based service EverSafe consolidates accounts, checks for suspicious activity, and sends alerts to family or trusted advocates. Service options range from $7.49 to $29.98 a month (with family and senior discounts).

If your loved one does get taken by a scam, don’t lecture or judge. They probably feel guilty and gullible enough already. But continue your vigilance in protecting seniors from scams.

After McAllister’s mother was duped, he recalled, “When the credit card bill came, she immediately paid the $2,000 – and has called herself ‘stupid, stupid, stupid’ repeatedly. She says she will never, ever fall for something again. No one will ever scam her again. She’s adamant. I believe her. But then I thought that before.”

To report a scam or other fraud, contact:

Annie Tobey

Annie Tobey has been a professional writer and editor for more than 30 years. As editor of BOOMER magazine, she explored a diversity of topics of particular interest to adult children of seniors. When she’s not writing, she can be found running the trails or enjoying a beer with friends.

Annie Tobey