Elder fraud is a big deal. It affects 1 in 5 people over the age of 65, leading seniors to be robbed of an accumulated $2.9 billion every year.
Financial exploitation isn’t an easy problem to tackle. Scams come in all shapes and sizes and financial fraudsters are constantly changing up their tactics to take advantage of elder adults’ vulnerabilities.
Why Target Senior Adults?
Elders aren’t simply an “easy” mark. The fact is, the senior years often include a number of big changes. Elder adults may move residence to be closer to family or to enter a care home; reorganize bank accounts and other financial assets following retirement or the death of a spouse; and start up new financial relationships with legal professionals, medical professionals and so on.
Fraudsters are very aware of what senior adults are facing. They know that retirement, estate planning and residency changes mean plenty of new financial admin to keep track of, not to mention unknown people and financial actors coming in and out of the picture. Scammers prey on this, hoping to slip unnoticed into that growing stack of bills and paperwork, without anyone realizing it.
Of course, the rapidly changing world of technology presents another opening for fraudsters to reach seniors; especially those who are less familiar with security protocol or uncertain when it’s safe to share certain information over the phone or via email.
Common Types of Elder Fraud
Scammers typically prey on senior adults in one of the following ways – but be vigilant. New scams are emerging all the time.
- Impersonation scam: Communicating over the phone or via email means a fraudster can pretend to be practically anybody; especially with spoofing technology that can mask or change their caller ID. The fraudster may claim to be a bank officer, a credit card employee or a family attorney and ask the victim to share personal information such as a social security number, date of birth or bank account number, which can then be used to access accounts or commit identity theft and open a line of credit in the victim’s name.
- Imminent danger scam: In this scam, the fraudster will pretend to be a relative and say they are in serious danger and desperately need financial help – fast. They’ll try to convince the victim to immediately transfer money to a bank account or to share a credit card number. Alternatively, the scammer might pose as a tax official or utility company employee and say the victim owes money, which must be paid immediately.
- Subscription scam: If you notice unusual charges to your account or the account of a loved one, it might be a subscription scam – meaning the fraudster is technically providing a service, but charging way too much money for it. The victim may end up spending hundreds of dollars per month to receive a magazine, e-newsletter, phone app or other service that’s being charged at a rate far, far higher than market value.
- Lottery scam: A classic example of fraud, the scammer will call or email the victim to say they’ve won a lottery or contest and that in order to collect their winnings, an up-front fee must be paid. Alternatively, the scammer could ask to “confirm” personal information such as a name, bank account and social security number, which would then be used to perform identity theft or get access to these accounts.
- Family or caregiver scam: Sadly, the Senior Investor Protection Resource Center reports that family members, friends, and caregivers are responsible for more than half of all known cases of elder fraud. Gaining and exploiting trust can happen slowly over a number of months or even years, as the scammer gradually encourages certain spending habits or gets more and more access to the victim’s accounts.
How to Fight Back
- Talk about elder fraud as a family. Mention scams you’ve read about in the news and maintain an open discussion about what scams are common in your area. The more you can talk candidly and without judgement about how scammers prey on different kinds of victims, the more likely it is that you or your loved ones will recognize fraud.
- Create a financial management system for older family members or devise your own, to avoid getting overwhelmed with all the new financial needs that will inevitably arise as the years go on. This process will likely include granting power of attorney to a trusted family member or friend.
- Streamline financial assets wherever possible for yourself or the elder adults in your life, including automating bill pay and cancelling credit cards that aren’t being used, so that there are fewer opportunities for scammers to find an opening for fraud.
- Monitor bank statements and credit reports more closely, keeping an eye out for large or recurring debits and paying particular attention to any sudden changes in credit score.
- When in doubt, hang up! Remind older adults in your family to be calm and confident if they’re being asked to share financial information over the phone or via email; especially when a time-sensitive deadline is mentioned. It’s never a bad idea to simply hang up and call back an official customer service hotline.
How HUECU Can Help
HUECU is dedicated to serving the community and doing our part to stop elder fraud. Like other credit unions and banks, HUECU will never ask for your passwords or call you to request your social security number or date of birth. When in doubt, you should hang up the phone and contact our Support Center at 617-495-4460, or visit huecu.org/locations to find official contact details for your local HUECU branch.
