It’s A Dangerous World Out There
The U.S. Justice Department recently released the 2022 FBI Elder Fraud Report. It does not make for enjoyable reading. There were almost 90,000 victims of fraud over the age of 60 last year. And they lost in aggregate over $3.1 billion, an increase of 84% over 2021. What are some of the biggest scams and what can you do to protect yourself?
Call center fraud, involving fake technology support as well as government official impersonation, involved the most victims. These scammers take advantage of seniors’ unfamiliarity with technology to convince them they need to pay for (and allow access to) their computers and/or cell phones. Alternatively they represent themselves as an IRS or other government agent, demanding money and threatening jail if the victim does not comply. Over 20,000 people lost almost $600 million to this type of fraud in 2022.
The second biggest category was investment fraud. Although a lesser number of seniors (4,500) fell victim to it, their losses were greater – almost $1 billion. These include selling Ponzi and pyramid schemes, advance fees, and other fraudulent investments. A growing number have involved cryptocurrencies.
Romance is another popular scam targeting seniors. The scammer, an accomplished actor, establishes a relationship with a lonely, vulnerable elderly victim over social media and/or by phone. Seemingly genuine, caring, and believable, they gain the victim’s trust before asking for money for a medical or legal emergency. These and grandparent scams – in which a panicked-sounding loved one claims to be in trouble and needs money immediately – caused over 7,000 seniors to part with more than $400 million.
Lottery scams – congratulating you for having won a contest or sweepstakes that you did not enter and requiring money in order to claim your prize – cheated over 2,300 elderly victims out of some $70 million last year.
Is there a way to protect yourself? The best way is to be highly skeptical of anyone reaching out to you with any and all unsolicited offers. If the contact is by phone, just hang up, and be sure not to call any phone number left in voicemail. If via email or text, do not click on any link in the message and do not respond. If it’s on social media, ignore it. If you do receive a message with an offer in which you are interested, rather than clicking on the link, use Google to search for the company or provider and follow up that way. Searching on “Is [Company Name] legit?” might also provide some useful insights.
If you receive a message purporting to be from a financial institution, government agency, or other organization, especially one with which you have had no previous contact, follow the same approach. If they are asking you for money or for personal information or asserting that you have some problem that you didn’t know about, that should be a huge red flag.
What about grandparent scams? If you receive a phone message that sounds like someone you know asking for money or personal information, hang up and call them back at their regular number. If such a message comes by email or text, ignore it and reach back out by phone.
The best way to avoid romance scams is to avoid meeting strangers online. If you’re looking for romance, do it face-to-face.
In general, always use a credit card if possible when sending money to someone you don’t know. Never use gift cards and only use wire transfers from your bank if you’re absolutely sure the transaction is legitimate.
Here’s a link to the FBI report: https://www.ic3.gov/Media/PDF/AnnualReport/2022_IC3ElderFraudReport.pdf