Ann Wiggins-Williams, 64, received a robotic call from the ‘IRS’ about monies owed to Uncle Sam. The voice explained how she and her husband, Carl are delinquent on their taxes and how they would be arrested if they failed to provide their credit or debit card info to pay the bill. “The first time I received the phone call, I thought it was real and almost fainted when I heard that IRS threat,” Ann recalls. “Even though I was afraid, my instinct kicked in as I listened to the call further and I became suspicious. I immediately called my husband who was at work. He assured me that all was fine with our tax situation and that it was probably a scam. For further piece of mind, I called the IRS myself and was informed that they never make phone calls about taxes owed. A written notification is a route they take in order to let people know about their tax issues. I was assured that the IRS does not make shake-down calls and would not threaten a taxpayer via phone with arrest for non-payment. These types of scams are so just so scary!”
Scams are run every day on unsuspecting folks like Ann and unfortunately, those who are AARP-eligible usually fall for them. According to statistics, people north of age 65 are swindled out of nearly $3 billion a year due to scams. Many of the cons are done via phone and these callers may demand money, or state you have a refund due, and try to trick you into sharing private information. These scammers can sound real convincing when they call. They may know a lot about you, and can even alter the caller ID to make it look like a valid organization is calling. They use fake names and identification badge numbers. If you don’t answer, they often leave an “urgent” callback request.
Why are older people easy marks for fraudsters? After a lifetime of working and investing, seniors possess an enormous concentration of wealth. One study says baby-boomers control more than $13 trillion in assets. According to the FBI, older folks are just easy prey. “People who grew up in the 1930s, 1940s, and 1950s were generally raised to be polite and trusting. Con artists exploit these traits,” notes the FBI in a warning about senior fraud.
Research suggests that older adults are less likely than other consumer age groups to report becoming victims. Sometimes they are too afraid or embarrassed to tell anyone they have lost their money. In some cases, they do not even realize they were victimized. The damage can be as minimal as a few unwanted magazine subscriptions or as extreme as the loss of an entire life’s savings.
How can you protect yourself from becoming a victim of a con game? Check out these top 10 fraud scams culled together by the National Council on Aging that you should be aware of:
- Health Care/Medicare/Health Insurance Fraud: There are endless varieties of this scam aimed at getting the personal information of seniors by scam artists who promise bogus services for elderly people and then use the information to bill Medicare and then pocket the money.
- Counterfeit Prescription Drugs: This is most often perpetrated via the internet when seniors search for better prices on specialized medications. Not only is there a danger of paying for meds that will not help the senior’s medical condition, but victims may purchase unsafe substances that can cause harm.
- Funeral and Cemetery Scams: Scammers read the obituaries and take advantage of the grieving widow or widower by claiming the deceased owes an outstanding debt and then extorts money to settle the false claim. Another scam perpetuated by disreputable funeral homes preys on the unfamiliarity of family members with the considerable costs of services by adding unnecessary charges to the bill.
- Fraudulent Anti-Aging Products: There is big money in the anti-aging business and many older people seek new treatments and medications to remain looking youthful. Scammers sell senior bogus homeopathic remedies that do nothing.
- Telemarketing: Scammers commonly use fake telemarketing calls to prey on older people. Seniors make twice as many purchases by phone than the national average. With no paper trail or face-to-face interaction, these scams are incredibly difficult to trace. To add insult to injury, once a successful deal has been made, the buyer’s name is shared with other scammers who are on the prowl for easy marks.
- Internet Fraud: Seniors who are not computer savvy can be easy prey for scams that cause computer viruses that open information on the user’s computer to scammers.
- Investment schemes: Because many seniors find themselves planning for retirement and managing their savings after retirement, investment schemes have long been a successful way to take advantage of seniors. They can range everywhere from pyramid schemes like the one that Bernie Madoff perpetrated, to complex financial products that many economists don’t even understand.
- Homeowner/Reverse Mortgages: The reverse mortgage has mushroomed in recent years. Unsecured reverse mortgages can lead property owners to lose their homes when perpetrators offer money or a free house somewhere else in exchange for the title to the property.
- Sweepstakes and Lottery Scams: Here scammers inform their mark that they have won a lottery or sweepstakes and need to make some kind of payment to unlock the prize. Often, this scam involves having the senior deposit the fake prize check into their bank account. The prize amount shows up in their account immediately and takes a few days before it is rejected. In the meantime, the scammers collect money for supposed taxes or fees on the prize as the victim has the ‘prize money’ removed from their account as the check bounces.
- The Grandparent Scam: This simple scam involves a call to an older person by an imposter grandchild who asks for money to resolve an unexpected financial problem. The money is usually paid to the Western Union or MoneyGram which don’t always require identification to collect.
4 Ways To Prevent Senior Fraud
Help protect yourself and reduce your risk of financial abuse by following these tips:
- Avoid isolation by staying involved with friends, family, and community activities.
- Refuse to engage with anyone who calls or comes to the door selling anything or looking for donations.
- Use direct deposit for checks ensures that they go right into your account and are protected.
- Never give credit card, social security number, banking, or other personal information out over the phone unless you initiate the call.
Report ALL scams!
Better Business Bureau–www.bbb.org/scam-stopper
Consumer Financial Protection Bureau–They protect consumers from unfair, deceptive, or abusive practices and take action against companies that break the law, 1-855-411-2372; www.consumerfinance.gov
FTC Do Not Call Registry–register scam numbers and stop the calls to your home,
Major Credit Bureaus—Stay on top of your credit profile, get a free annual credit report, 1-877-322-8228; www.annualcreditreport.com
Social Security Administration–1-800-269-0271; www.ssa.gov
Treasury Inspector General for Tax Administration (TIGTA)–If you know you don’t owe taxes or have no reason to believe that you do, report the incident. 1-800-366-4484; www.tigta.gov