Protecting the elderly from financial abuse is essential as financial fraud threats continue to rise. While online scams are common, fraud can also happen by phone, mail or in person. What’s more, aging adults make especially easy targets for financial scams. According to a recent MetLife study, financial abuse costs elder Americans at least $2.9 billion each year
To best protect your loved ones, I’ve highlighted the most common types of scams to teach them the warning signs and caution them against sharing their financial information.
Medicare schemes that target seniors happen all too often. It can start with scammers pretending to be Medicare representatives or fraudsters posing as insurance agents to gather personal information.
Because health insurance is often confusing, some people are too willing to share more than they should to smooth out what they believe are medical billing issues. If an insurance thief gets personal details, they can use it to bill Medicare for fake services and pocket the money.
Teaching tip: When protecting the elderly from financial abuse, advise them to keep their medical information private and help them understand Medicare insurance. Remind them to limit who they share their Medicare number, Social Security card or other personal information with.
Funeral scams prey on widows and widowers. These scam artists read obituaries and make a point to attend the funerals, often posing as a debt collector claiming there’s an unpaid debt, in order to prompt payment from a grieving family member.
Another funeral scam to watch out for involves the funeral homes and instances where they will over-charge customers for services. To catch these, look for a significant increase in the prices of services and goods since these might be fraudulent charges.
Teaching tip: Shop around for funeral services and pay special attention to payment details. If you notice excessive charges, speak up about it to avoid being taken advantage of during the grieving process.
Typically, this scam is a form of investment fraud where a caller can pretend to be a member of the same religious, career, ethnic or community-based group to connect with individuals. With the affinity scam, protecting the elderly from financial abuse isn’t easy. The scammer uses common ground to build trust and then convinces them the investment is legitimate.
Even more, it’s difficult for law enforcement to identify affinity scams because the groups have a tight-knit structure. Additionally, instead of reporting the fraud, the victim attempts to work things out with the group. If they’re not careful, they can lose hundreds of thousands of dollars.
Teaching tip: Encourage discussions about investing opportunities with you or a trusted financial advisor.
Typically occurring via the internet, sweetheart scams target victims using fake profiles on dating sites and social media to lure a lonely senior through the promise of a romantic relationship. This often turns into outright blackmail, and they may eventually extort them for money.
Teaching tip: It’s easy for an elderly widow to feel lonely and desire affection, but introducing your loved one to community groups and senior centers is an excellent social outlet, and much safer than building online relationships.
Seniors are generally less familiar with how the internet works, so this makes it more likely that they’ll become a victim to fake claims of virus infections or online scams. By not having a basic understanding of online security, scammers find it easy to trick elders into downloading bogus antivirus programs in exchange for a fee.
Sometimes, the fraudster requests a telephone number to talk on the phone. Hearing a real voice on the other end of the line can instill a false sense of trust, and this may cause them to give up their sensitive financial information too freely.
Teaching tip: Explain the fundamentals of internet safety. Remind them that it’s unusual for a company to reach out and request credit card information or bank account numbers online.
Protecting the elderly from financial abuse requires you to point out some common scams they might encounter. Warning signs, such as calls from creditors, sudden expensive purchases or mail that piles up and is left unopened is indicative that something might be wrong. For online scams, sharing at least a basic understanding of internet safety can help protect them. The more information you can give your parents, aging neighbors and other seniors, the better off they’ll be. If you believe someone has become a victim of a financial scam, don’t hesitate to step in and take action.