It started by filling out a sweepstakes form.
What could go wrong? She sent in a little information on a card, nothing that could assist in stealing her identity, and maybe just maybe she’d win a little money.
By the time we figured out Mom had been experiencing fraud and scam abuse, she had been receiving threatening phone calls for weeks and had already given away several thousands of dollars. In the rush of the holiday chaos, she had not wanted to bother us and hoped to fix the situation herself, only to give away more money.
We ended up calling and filing reports with the police, changing her phone number and making a formal complaint with the Federal Trade Commission. Then we had a heart to heart talk with Mom to help her understand how often this happens and what can be done to prevent the same thing from happening in the future.
The money was unfortunately never recovered, and many hard lessons were learned through that situation.
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Financial scams against seniors
According to the Federal Bureau of Investigation, people over 65 are more vulnerable to these types of attacks, especially around the holidays. Retirement age individuals are specifically targeted because of the amount of assets they have accumulated as well as their good credit score. Since seniors are known to suffer more from cognitive changes and often live alone, they make easier targets.
So what do you need to look out for to help your loved one this season?
According to the National Council on Aging (NCOA), a few of the top scams targeting seniors include:
Phone scams are the most common scams used against the elderly. It is not unheard of for scammers to get seniors to wire money or send checks or even pass along credit card information after pretending to be a family member in need (also called the “grandparents scam”). Another common approach is calling as a telemarketer hoping to sell the lonely senior citizen a product. This common tactic works since you typically pay first and receive your order later.
Fake sweepstakes or lottery winnings
It is pretty straight forward but oh so clever- a sweepstakes card comes in the mail that offers the incentive for a big prize. All that needs to be done is fill out the questionnaire. No personal information is requested- typically a name, address, and a good phone number to call when you win. So the card is sent back and forgotten about until one day a call is received to congratulate you on your good fortune! This is where the scam really comes in to play- sometimes it is a large lump sum that has been “won” and other times smaller sums supposedly distributed out over time. All that your loved ones have to do is pay the processing or tax fees and the prize is theirs. It’s wrapped up in the guise of taxes and laws and for many it seems perfectly logical. It’s a quick and efficient way to scam someone out of thousands of dollars.
Fake Gift Cards
This particular scam can get the best of all of us as it is easy to tamper with gift cards on displays without attracting a ton of attention. When purchasing gift cards it is always best to get them straight from the source- directly at the retailer via register or on their official website.
This time of year, many feel extra giving and that is ok! Keep in mind that it is very easy for someone to say that they work with a reputable charity only to try solicit donations for an often made up cause. The easiest way to avoid getting duped is to confirm the information. Get the person’s name, the charity they “work” for, the address and phone number, and the cause they are attempting to raise funds for. It is not recommended that you call that number but rather check the information online to confirm at a website such as the BBB to confirm the legitimacy of the program. It is also recommended that instead of giving funds directly to a person- that you do it through the charity itself.
So how do you help your loved ones avoid these scams?
First and foremost you talk to your family and help them understand key phrases to look out for or questions they should ask before committing their money to anything.
- If someone calls pretending to be a family member- have them confirm the information. Often someone will call and start out the conversation with a “Guess who?” and once a guess is offered, the scammer rolls with that. Best practice when money is being requested from a potential friend or family member is to hang up the phone and call that person on their direct line, not from the phone number that was just used and make sure you actually spoke with the person they claimed to be.
- Be on the lookout for anything that requires you to pay something in order to receive your gift or winnings. You will never have to pay processing or tax fees directly to a company when you have won something. If someone is requesting money before you can collect your prize- odds are it is a scam.
- When it comes to telemarketing scams- remember that legitimate companies won’t pressure you to make a snap decision.
- Don’t pay for any advance services on anything- always pay after they are delivered or service is rendered to your satisfaction.
- Never give out personal information such as credit card numbers, bank account numbers, date of birth, or social security numbers to unfamiliar companies or persons and check your private information frequently to ensure that nothing is out of place.
- Credit Freezing. A Credit Freeze is also known as a security freeze and it prevents anyone from opening credit accounts in your name, even you. When a new credit account is applied for, the creditor will first need to see your credit report. If your credit is frozen the creditor cannot access your credit report so no new accounts can be open.
Don’t just help them avoid fake scams but also keep a look out for legitimate companies that focus their marketing on seniors. For every fake sweepstakes or telemarketer that is out in the world attempting to gain access to the elderly through cons and imaginary products, there are equally as many companies that specifically market to that age bracket for the same reason. What they sell might be under the guise of a well-known company, but that doesn’t mean your loved one can’t lose a large amount of money over time.
When it comes to spending habits and whether or not a purchase might be in your best interest- the old adage “if it sounds too good to be true, it probably is” comes to mind. If you or a loved one happens to fall prey to one of these schemes don’t beat yourself up over it. Contact your bank right away and ensure that your private information remains safe and most importantly, keep up to date on the most recent scams targeting seniors by checking with the Federal Trade Commission.