I must be so special! Nigerian princes. Colonel Ghaddafi’s wife. Saddam Hussein’s daughter. Imelda Marcos. All of them wanted to give me huge a percentage of millions that they have secretly stolen/found/inherited if I just give them my bank account number and, as a goodwill gesture, pay a small fee to create the transfer! Just think, all these generous strangers picked me to help them and they would, in the process, make me rich. BALONEY!
In Part 1 of this series, we explored how scammers identify seniors to target, how they groom their marks and what factors create a perfect target. In Part 2, we’ll explore the top 10 scams currently being used on seniors throughout the country as identified by The National Council on Aging www.ncoa.org/economic-security/money-management/scams-security/top-10-scams-targeting-seniors/:
1. Medicare/health insurance scams: In these types of scams, scammers most often pose as a Medicare or health insurance representative. They ask for personal information (full name, date of birth, social security and/or Medicare number, etc). A variation of this scam involves crooks setting up bogus services for elderly people at makeshift mobile clinics/kiosks or even visiting the seniors home to do a free blood pressure checkup, say they are with the county health department conducting free checkups, etc. The purpose of this scam is to get the personal information. They can then use the information to send bogus bills to Medicare/insurance and pocket the money or they will sell the information to identity thieves.
2. Counterfeit prescription drugs: Ads pop up on the Internet and cable TV stations that promise drugs that are cheaper, don’t require a doctors visit and are delivered discreetly to your home. Scammers are looking for marks who, for whatever reason, would rather not go the traditional route to get medications – whether that is for convenience or cost. This particular scam can be both dangerous and costly. The danger is that the medication is not regulated, may or may not treat the person’s medical condition, and may or may not contain harmful substances. These scammers, like all others, are looking for money. They will either pocket the money or sell the credit card number and personal information to ID thieves. This scam hit both the health and wealth of the seniors.
3. Funeral and cemetery scams: In one approach, scammers troll obituaries then call or attend (less likely as it would be easier for law enforcement to identify them) the funeral service of complete strangers to take advantage of the grieving widow or widower. They may call to claim that the deceased had an outstanding debt with them and try to extort money from relatives. They may call and say they are from the funeral home and need more information. They may call and say they are with the life insurance company, the bank calling about the retirement account, the county calling to complete the death certificate, etc. These crooks will target every facet of the funeral/burial/death process to try to get money and take advantage of the family’s grief.
4. Fraudulent anti-aging products: Anti-aging cures – the holy grail that entices many older Americans to seek out new treatments and medications to maintain a youthful appearance – create a perfect scenario for scammers. Whether it’s fake Botox like the one in Arizona that netted its distributors $1.5 million in barely a year before they were convicted and jailed in 2006 or completely bogus homeopathic remedies that do absolutely nothing, there is money in the anti-aging business. Scammers in these scenarios often sell ‘subscriptions’ to monthly/periodic renewals so that the one time ‘let’s try it’ purchase becomes an ongoing cost that is continually charged to the credit card. Canceling these subscriptions is nearly impossible and almost always requires canceling the credit card to stop the re-charges. As with all other scams, personal information and credit card numbers are also sold to other thieves.
5. Telemarketing/phone scams: With no face-to-face interaction, and no paper trail, these scams are incredibly hard to trace. Once a successful deal has been made, the mark’s name is then shared with similar schemers looking for easy targets, defrauding the same person repeatedly. Once a mark’s name is out there, it is next to impossible to stop the scamming.
Most often used telemarketing scams include:
The pigeon drop-The scammer tells the mark that he/she has found a large sum of money and is willing to split it if the person will make a “good faith” payment by withdrawing funds from his/her bank account. Often, a second scammer is involved, posing as a lawyer, banker, or some other trustworthy stranger. The scammers will ask for the mark to send them the money in the form of gift cards, online money transfers or money grams.
The fake accident ploy -The scammer reaches out the mark on the pretext that the person’s child or another relative has been in a horrendous accident and needs the money. A variation of this play is the ‘i got mugged overseas and I can’t get home – send money’. The same tactic is used – relative is in need of the mark’s financial help.
Charity scams –These scammers often surface after natural disasters. Callers will say they are collecting donations for the disaster stricken area, the devasted families, the military veterans, etc. The money goes directly into the scammers pocket.
6. Internet fraud: Automated Internet scams are nearly ubiquitous on the web and email programs. One of the most common (but certainly not the only) is the email/phishing scam. This scam works when a senior receives email messages that appear to be from a legitimate company or institution asking them to “update” or “verify” their personal information. Or the senior receives emails that appear to be from a government agency, such as the IRS, saying there’s a problem with a tax refund, social security benefits, etc. In all cases, the scammers are looking for personal information.
7. Investment schemes: From pyramid schemes like Bernie Madoff’s (which counted a number of senior citizens among its victims) to fables of a Nigerian prince looking for a partner to claim inheritance money investment schemes have long been a successful way to take advantage of older people. Scammers in these schemes are usually well-versed in investment terms, can speak intelligently about options, and may sound very legitimate. They may even have ‘real’ looking bond certificates. The mark’s money will never be seen again in this type of scam – the thieves will pocket everything and the mark usually only finds out about this when they don’t receive a statement or they try to withdraw money.
8. Homeowner/reverse mortgage scams: Scammers like to take advantage of the fact that many people above a certain age own their homes, a valuable asset that increases the potential dollar value of the scam. While reverse mortgages are actual financial options, scammers will set up bogus companies to pretend to be true RM providers. Other homeowner scams can be posing as repairment, landscapers, home maintenance warranty providers – the list is endless. These scammers are typically in person and may come unsolicited to the door.
9. Sweepstakes & lottery scams: You’ve won the lottery! A call we wish we all received but it is never, ever, real! This simple scam, one that many are familiar with, capitalizes on the notion that “there’s no such thing as a free lunch.” Scammers inform their mark that they have won a lottery or a sweepstakes of some kind and need to make some sort of payment to unlock the supposed prize. Scammers are looking for credit card numbers to sell.
10. The grandparent scam: This scam is truly heartless. Scammers will call an older person and, when the mark picks up, the scammer will say something along the lines of: “Hi Grandma, do you know who this is?” When the unsuspecting grandparent guesses the name of the grandchild (Sarah, is that you?) the scammer has established a fake identity without having done a lick of background research. Once “in,” the fake grandchild will usually ask for money to solve some unexpected financial problem (overdue rent, payment for car repairs, college tuition, etc.), to be paid via Western Union or MoneyGram, which don’t always require identification to collect. To add authenticity to this scam, the crook will beg the grandparent “please don’t tell my parents, they would kill me.”
Fraudsters and scammers know that it is often almost impossible to find them or prosecute their crimes. They count on that as they continue to develop and define ways of scheming and scamming. They also rely on that fact that many Seniors don’t know how to go about reporting fraud or may be ashamed to admit they got taken. Even if they are reported, so many of these criminals are based overseas. Even if the crimes are charged, it may take years to get to court during which time the victims may forget details making prosecution unlikely.
The best advice to avoiding being a victim of a scam is to educate yourself now. Research via the internet ‘scams against the elderly’ and review the information from reliable resources. The FBI has valuable tips about avoiding telemarketing fraud www.fbi.gov/scams-and-safety/common-fraud-schemes/telemarketing-fraud as well insight into all the common scams that they often deal with at www.fbi.gov/scams-and-safety/common-fraud-schemes . The National Council on Aging offers some logical tips on protecting yourself from financial scams at www.ncoa.org/economic-security/money-management/scams-security/protection-from-scams/ . There is a lot of information available, so get a big mug of coffee and settle into your favorite chair and read! It may help you from becoming a victim.
Know what to do if you suspect a scam or fraudulent scheme, or have unfortunately become the victim of one. Don’t be embarrassed. By reporting it, you may have the chance to recover your losses and certainly might help prevent others from the same fate. Call the police if you’ve had any type of financial loss due to nefarious reasons. They will create a case file and investigate. Call your lawyer. Go to the National Adult Protective Services Association http://www.napsa-now.org/get-help/help-in-your-area/ for more suggestions on what to do.
Education is the number one key in prevention. The more we learn about how scammers think and scheme, the less they’ll have to work with. One of the well-known rules-of-thumb seems to apply here – If it sounds too good to be true, it probably is. Don’t be a victim. Educate yourself starting today.