Your parent or elderly relatives may be the target of fraud scams aimed at stealing their hard-earned retirement savings. On this page, I will discuss some common issues the elderly face when it comes to scams, and how to protect them.
Reasons for Elderly Scams
Seniors are frequently exploited by criminals for several reasons:
- Seniors are easier to intimidate and tend to be more trusting of others.
- Seniors are afraid to report being defrauded because of embarrassment or fear of losing their independence once other family members find out.
- Seniors are often home during the day, and many are alone during the daytime.
- Seniors who feel lonely will seek contact with other people, and this feeling can be exploited by thieves and con-artists.
- Seniors have accessible money through savings, retirement, home equity, and pensions.
These factors can create a “perfect storm” situation where your parent or elderly relative is susceptible to frauds and scams. You should consider warning your parents against these frauds and scams, so they know what to look out for.
Here are some of the most common frauds and scams against the elderly:
(1) Beware of Fake “IRS” Phone Calls. The mere thought of owing money to the IRS creates feelings of fear and dread. The con-artists exploit these feelings to intimidate seniors into either making immediate payments or to providing their private information, like social security numbers, birth dates, and bank account numbers. The caller will claim that the IRS is owed significant tax debt and threaten that if the bill isn’t paid immediately, massive fines and criminal penalties will be assessed. According to the U.S. Senate Aging Committee, the IRS Phone Scam was the #1 fraud perpetrated against seniors in 2018. Some of the most unscrupulous con-artists will even falsely claim to be IRS agents. This situation is a completely fraudulent scam. The real IRS does not call you when you owe tax debts (they send certified letters). And for what it’s worth, the real IRS already knows your birthdate and social security number!
(2) Beware of Fake Social Security Phone Calls. Just like with the IRS phone calls, con-artists are now pretending to work for the Social Security Administration. In these false phone calls, the caller will try to intimidate seniors into providing their private information by saying that they are trying to help “reactivate” a social security number or that they need to confirm bank account numbers for direct deposit of benefits. Some of the callers will threaten arrest or that retirement benefits will be stopped if the person doesn’t comply with the request. As with the IRS, the Social Security Administration will not contact you by phone for this type of situation. More importantly, the Social Security Administration will never threaten anyone with arrest or other legal action.
(3) Beware of the “Old” Grandparent Scam. This is a form of fraud committed again and again against every new generation of seniors. The caller will pretend to be a grandchild in trouble that needs money right away. The caller will ask for payment through gift cards, wire transfers, or mailed cash payments. Variations on this type of fraud are false charities and fake national disaster recovery schemes. Often it can be difficult to distinguish between the legitimate and illegitimate scenarios. These schemes are meant to pull at heartstrings and prompt quick payments based on emotional responses. The best way to defend against being defrauded in this situation is to resist doing anything immediately, and by taking time to verify the truth of the situation.
Tips to Avoid Scams
So, what are some helpful tips for seniors to avoid being scammed?
- Never provide your personal identifying or banking information over the phone.
- Don’t act out of emotion. Paying money should be based on reason and facts.
- Don’t be pressured into doing anything immediately or over the phone.
- Verify the claim being made against you by contacting the government agency or business on your own before you do anything. Call your grandchild or relative directly and ask them to confirm their situation.
- Never mail, deliver, or hand over cash payments. Legitimate businesses and government agencies will accept checks, money orders, or credit cards for legitimate debts.
- Talk openly about these scams with your family and try to be on guard against them.
- Report any suspected frauds or scams to the police, and to the appropriate agencies.
If your elderly loved one was fooled by a scam, you can take legal action. Contact me to discuss your situation. I am happy to provide resources to help.