Playing Defense Against Elderly Financial Fraud
By: Scott Willman, Compliance, BSA, Fraud Intervention
Content modified from: https://www.fbi.gov/scams-and-safety/common-scams-and-crimes/elder-fraud
At an increasing pace, seniors are falling victim to financial fraud scams that include romance, lottery & sweepstakes, and tech support, to name a few. These types of criminals prey on vulnerable seniors’ emotions, and ultimately exert wrongful influence over their finances. Scammers most often use computers, phones, and the postal service. However, there is no shortage of scams perpetrated by family members and friends of seniors.
Local trends suggest social media and dating apps are used by scammers to initiate long-distance relationships with unsuspecting seniors. A common scenario involves a recently widowed senior who is looking for human connection. These victims are becoming easier to spot in advance, as obituaries or legal filings are accessible to the public on the internet. Once scammers gain trust and succeed in demanding small payments, they escalate and seek to drain the senior of their life savings—before ultimately vanishing with the funds in search of a new victim.
While the nature of seniors is often gentle and trusting, they also have accumulated substantial funds, own homes, and have a developed credit history. Seniors are often less inclined to report fraud because they don’t know how, don’t want their fantasy shattered, or they’re too ashamed of having been scammed. They might also be concerned that their relatives will restrict their abilities to manage their own financial affairs. And when an elderly victim does report a crime, they may be unable to supply detailed information to banks or investigators.
With the elderly population growing in numbers and seniors racking up more than $3 billion in losses annually, elder fraud is likely to trend upwards dramatically.
If you believe you or someone you know may have been a victim of elder fraud, contact your bank and local FBI field office or submit a tip online. You can also file a complaint with the FBI’s Internet Crime Complaint Center.
Common Elder Fraud Schemes
- Romance scam: Criminals pose as interested romantic partners on social media or dating websites to capitalize on their elderly victims’ desire to find companionship.
- McAfee or Norton scam: Criminals send an email appearing to be from McAfee or Norton Antivirus. The email claims that the recipient will be billed for the renewal of their McAfee or Norton subscription. The recipient is instructed to call a company representative to cancel the subscription. The criminal pretending to be the company representative asks for personal information, including bank account number, and then requests remote access to the victim's computer.
- Amazon scam: Criminals posing as Amazon representatives call victims, claiming that they are about to be charged for large Amazon purchases. The criminals then ask for bank account and debit card details.
- Tech support scam: Criminals pose as technology support representatives and offer to fix non-existent computer issues. The scammers gain remote access to victims’ devices and sensitive information.
- Grandparent scam: Criminals pose as a relative—usually a child or grandchild—claiming to be in immediate financial need.
- Government impersonation scam: Criminals pose as government employees and threaten to arrest or prosecute victims unless they agree to provide funds or other payments.
- Sweepstakes/charity/lottery scam: Criminals claim to work for legitimate charitable organizations to gain victims’ trust. Or they claim their targets have won a foreign lottery or sweepstake, which they can collect for a “fee.”
- Home repair scam: Criminals appear in person and charge homeowners in advance for home improvement services that they never provide.
- TV/radio scam: Criminals target potential victims using illegitimate advertisements about legitimate services, such as reverse mortgages or credit repair.
- Family/caregiver scam: Relatives or acquaintances of the elderly victims take advantage of them or otherwise steal their money.
Best Practice Tips to Protect Yourself
- Add Powers of Attorney to your account so trusted friends and family can play a part in protecting your funds before they’re stolen.
- If you recognize scam attempts, end all communication with the perpetrator immediately.
- Did you know Google Images can run a reverse-image search? It’s easy. Upload the picture of the person into the Google Image search field to see if they're using someone else's photo. This works great against the scam known as “catfishing.”
- Search online for the contact information (name, email, phone number, addresses) and the proposed offer. I like the Federal Trade Commission’s Fraud Page for this tactic. Other people have posted information online about individuals and businesses trying to run scams. Faking it — scammers’ tricks to steal your heart and money | FTC Consumer Information
- Resist the pressure to act quickly. Scammers create a sense of urgency to produce fear and lure victims into immediate action, demanding funds immediately by cash or wire. Call the police immediately if you feel there is a danger to yourself or a loved one.
- Be cautious of unsolicited phone calls, mailings, and door-to-door services offers.
- Never give or send any personally identifiable information, money, jewelry, gift cards, checks, or wire information to unverified people or businesses.
- Make sure all computer antivirus and security software and malware protections are up-to-date. Use reputable antivirus software and firewalls.
- Disconnect from the internet and shut down your device if you see a pop-up message or locked screen. Pop-ups are regularly used by perpetrators to spread malicious software. Enable pop-up blockers to avoid accidentally clicking on a pop-up.
- Be careful what you download. Never open an email attachment from someone you don't know and be wary of email attachments forwarded to you.
- Take precautions to protect your identity if a criminal gains access to your device or account. Immediately contact your financial institutions to place protections on your accounts and monitor your accounts and personal information for suspicious activity.
How to Report
If you believe you or someone you know may have been a victim of elder fraud, contact your closest FBI field office. You can also submit a tip online to the FBI. As a next step, I encourage you to contact us at Iowa State Bank so we can install protections on your accounts.
When reporting a scam—regardless of dollar amount—include as many of the following details as possible:
- Names of the scammer and/or company
- Dates of contact
- Methods of communication
- Phone numbers, email addresses, mailing addresses, and websites used by the perpetrator
- Methods of payment
- Where you sent funds, including wire transfers and prepaid cards (provide financial institution names, account names, and account numbers)
- Descriptions of your interactions with the scammer and the instructions you were given
You are also encouraged to keep original documentation, emails, faxes, and logs of all communications.