6 Warning Signs of Financial Scams Targeting Seniors
Don’t be a victim. Educate yourself about the most popular scams targeting older adults.
In today's world, everyone is a potential victim of scammers. However, there are specific tactics used on older adults. According to the FBI's most recent Internet Crime Report, Americans over 60 lost $1.7 billion to fraud last year – the highest reported loss out of any age group. "These days, cyber scams abound and frequently target seniors, a vulnerable population with less technology knowledge," explains Dr. Zulfikar Ramzan, Chief Scientist at Aura.com, an AI-powered consumer security platform. "Typically, scammers deceive senior citizens with false promises of products or services. After they gain the senior's trust, these scam artists go after financial details, health insurance, or even possibly even physical possessions. Here are 6 warning signs of financial scams that target seniors.
WARNING SIGN: Unexpected, disconcerting news about a loved one. The "grandparent scam" is where scammers will contact the senior to claim the victim's grandchild is in trouble, explains Ramzan. "Imposters may pretend to be the police, call, and say that the grandchild has been in an accident or was involved in a crime. The scammers will ask their targets to retrieve large sums of money or make a wire transfer to 'save' their grandchild. This is especially dangerous because the scammer may even know the grandchild's name and other identifying information to make the situation seem more real," he explains.
WARNING SIGN: Unfamiliar financial charges, new accounts and loans, or credit inquiries that the senior did not create. Here, commonly referred to as "elder financial abuse," someone the victim knows and trusts attempts to gain access to the senior's assets, credit, or savings. "The scammer could trick their victim into signing over access or power of attorney," says Ramzan.
WARNING SIGN: Unsolicited phone calls about tech support. In a "tech support" scam, the aggressor masquerades as a tech support representative from a company you trust like Apple or Microsoft. "Companies like Apple will never proactively call you about these issues, but this person will claim that the senior's computer or device is at risk of being infected by viruses and then trick them into granting remote access or paying for software," claims Ramzan. The goal? "To trick the victim into downloading "what they think is helpful software that actually turns out to be malware, opening the door for cyber attacks that target the victim's banking information," he says.
WARNING SIGN: a notification about winning a large sum of money from a contest the senior never entered. In this scam, fraudsters reach out to a senior and claim that the person has won a contest, lottery, or sweepstakes that they don't remember entering, "but to receive winnings, the senior is required to pay upfront fees or taxes, supplying banking information for the transfer," says Ramzan. "Scammers can even string along these victims for months or years, claiming that they need to make additional payments."
WARNING SIGN: A budding romance may have some major red flags, such as the "relationship" moving at a frantic pace, the other person promising to meet in person but then doesn't show up OR the "date" asking for money/financial help. "In this scam, the perpetrator will create a fake persona on a dating app or social media to lure their targets, who are often lonely and extremely vulnerable," explains Ramzan. "Con artists will research online and find details that the senior has shared publicly to entangle with more skill." Once the scammer establishes a rapport, they request money, often in the form of gift cards, travel expenses, or healthcare costs.
WARNING SIGN: A sudden push or request for the senior to consent to a reverse mortgage. Lots of seniors have built equity in their homes. Reverse mortgages are available to those homeowners over age 62 as a method to access this home equity, "but scammers take advantage of this through billboards, ads, and fliers for reverse mortgage scams," explains Ramzan. "The scammer will claim to want to help the senior access the equity, but they either steal the money or even engage in deed fraud and 'steal' the senior's home. Other warning signs include:
–High-pressure sales tactics that try to get a senior to consent to a reverse mortgage without doing any due diligence.
–Contact from someone who claims they need power of attorney to finalize a reverse mortgage.
–Vendors suggest the senior take out a reverse mortgage to pay for costly repairs.