Scams are on the rise, and they are becoming more and more sophisticated. A 38% increase in fraud losses was reported by people in 2018, according to the Federal Trade Commission, which collected 1.4 million fraud reports. The younger generation lost money to fraud more often than the older generation, with 43% of respondents in their 20s confessing to losing money to scams. Only 15% of those in their 70s reported losing money, and older people lost more. Those in their 70s reported a median loss of $751; those in their 20s reported a median loss of $400.
According to the FBI, senior citizens are targeted for fraud for many reasons. Seniors are often well-off, own homes, and have good credit, making them attractive targets for con artists. Scammers may also succeed more easily with seniors because it takes them longer to realize they’ve been scammed and slower to report it. Additionally, fraudsters tend to exploit the politeness and trustworthiness of individuals who grew up during the 1930s, 1940s, and 1950s.
Scams involving Medicare, reverse mortgages, and counterfeit anti-aging products can be financially and emotionally draining. It is a good idea to file a complaint with the Federal Trade Commission and contact your local police if you think you have been scammed. USA.gov provides a complete list of where to report scams based on the type of fraud involved.
Scams involving Medicare Beneficiary Identifiers
Medicare & Medicaid Services recently rolled out new cards for beneficiaries to reduce Medicare scams. Beneficiaries’ Social Security numbers are no longer displayed on these cards; instead, a random Medicare Beneficiary Identifier (MBI) is displayed. However, scammers continue to find ways to gain users’ personal information. They ask for your MBI to “activate” the card or offer you a plastic upgrade from the paper card, so long as you provide your personal information (Social Security number, birth date).
Make sure you don’t fall victim to this scam: Medicare employees will never call you without your permission, and your insurance coverage cannot be canceled because you don’t provide vital information.
Scammers often run their scams through social media, especially targeting older, less tech-savvy users. By viewing your likes and followings on Instagram, scammers may target you with scams based on your interests. You might receive a direct message offering cheap tickets, and the link will steal your personal or banking information when you click on it to claim your tickets. You can avoid this scam by not responding to unsolicited direct messages or direct messages from unknown individuals.
It is common for older Americans to prearrange or prepay for their funerals to reduce the burden on their loved ones. Due to this, scammers often overcharge for their services or list themselves as beneficiaries. The laws that govern this industry vary from state to state. Still, intelligent individuals can avoid scams by shopping around, reading contracts carefully, and making sure cancellation terms are clearly outlined.
Counterfeit prescription drug scams
Using targeted ads, scammers may post advertisements for prescription drugs at super-low prices using the internet. These drugs could be contaminated, contain no active ingredient, or include the wrong dosage of an active ingredient. Do not purchase medications from unlicensed pharmacies or those without the Verified Internet Pharmacy Practice Site (VIPPS) seal to avoid scamming. Any questions you have about a specific product should be discussed with your doctor or pharmacist.
Social Security Administration phishing scams
Many seniors access their Social Security benefits and manage their personal information through my Social Security portal. To steal information or coerce individuals into providing it, scammers have started sending “phishing” emails containing malware. When retirees receive emails like these, they are often informed that there is something wrong with their account and that they must take action immediately. Please verify the URL included in the email before clicking any links or sending personal information. A real government website ends in .gov or .gov/. Anything else is a scam.
In telemarketing scams, the basic concept is almost always the same: you’ll receive an unsolicited phone call from various companies, public utilities, or government agencies claiming you’ve won a prize, qualified for a steep discount, or that something is wrong.
Scammers use pressure to get you to provide vital personal information that will allow them access to your bank account or convince you to wire funds to them. It may be difficult to identify scams like these; general hallmarks include pressuring you to act faster, not answering questions, and offering you too good to be true deals.
Similar to telemarketing scams, charity scams solicit money via telephone for fake charities. Make sure you research any charity you are considering before donating, and never donate with cash, gift cards, or wire transfers to avoid being duped. Make sure you understand how a charity plans to use your donation-ask for specifics and be skeptical of sentimental claims.
Advance fee scams
There are many types of advance-fee scams, just like telemarketing scams. They usually ask people to send a small amount of money “up front” in exchange for something of much greater value, such as found money or investment earnings. Offers that seem too good to be true should be avoided, as should business handled in an unprofessional manner (e.g., dropping an envelope filled with cash at a specific location).
Vacation rental scams
Traveling during retirement can lead to seniors falling victim to vacation rental scams. Scammers will fabricate an entire vacation rental listing, down to the details, promising great amenities or a lower-than-normal rate. Upon arriving at the property, excited vacationers find it isn’t there. You should avoid super-cheap rates in prime locations, get a copy of the contract before sending money, and never wire money for rent.
Computer technical support services scams
Scams involving computer technical support services have increased since the Federal Trade Commission began warning the public about them in 2018. Cons pretending to be from well-known technology companies call targets (often seniors) claiming that their security software has expired, leaving them vulnerable to hackers. Then, they sell them outdated, overpriced security software and steal their personal information as they install it. To avoid this scam, you should ask a lot of questions, do independent research, and don’t be rushed into anything.
Fraudulent anti-aging product scams
According to the FBI, fraudulent anti-aging products are increasing in the United States. Usually sold online, these products can contain dangerous ingredients such as arsenic, beryllium, high levels of aluminum, and bacteria found in urine. Don’t waste your money on products that don’t work and can harm your health by being aware of claims sounding too good to be true, doing your research, and talking to a doctor before using anything (especially if it’s ingestible).
Home repair scams
This is an in-person scam in which fraudsters pretend to be repairmen and offer their services for an issue they just noticed, such as clogged drains or broken gutters. You’ll agree to the work, they’ll ask for payment upfront, they’ll do some unlicensed or shoddy work, and then they’ll reveal that the problem was more serious than they originally thought, so you’ll have to pay more. To avoid getting scammed, retirees should insist on seeing references, sign contracts before any work is done, and do not accept unsolicited work.
Reverse mortgage scams
The reverse mortgage scam is one of the most common and dangerous scams targeted at seniors. Real estate and financial professionals use these scams to steal equity from older homeowners or manipulate them into unwittingly stealing equity from flipped properties. If you want to avoid these scams, seek out a housing counselor licensed by the Housing and Urban Development Department. Keep an eye out for unsolicited advertisements, don’t sign anything you don’t understand, and beware of anyone who claims you can do amazing things (like owning a home without a down payment or accepting payments for a home you never owned).
High-yield investment scams
Retirees’ fears of not having enough money for retirement often fuel phony investment scams. Investors are often promised high returns of 30% to 40% daily, weekly, or monthly by high-yield investment scams conducted on the internet. The Securities and Exchange Commission warns that high-yield investment programs are almost always scams.
Some retirees wish to make a little extra money by starting a small business from home. Consequently, they are vulnerable to MLM scams or pyramid schemes. Often, these scams, in which you must sign up others to sell a low-quality or nonexistent product, cost you more than they make you. Avoid businesses with unfounded and over-the-top product claims, pressure to buy inventory, and low BBB ratings-and steer clear of any that make you feel uneasy.
The thought of winning a dream vacation, new car, or brand-new grill may seem like a dream come true until it isn’t. Victims of sweepstakes scams are told that they’ve won sweepstakes or lottery and that they just need to provide their personal information or send a small amount of money to cover taxes and fees. Realistically, there are no prizes, the money goes straight to a scammer, and your personal information can now be stolen or hacked. Sweepstakes that require payment for prizes (especially money sent by wire transfer), prizes that you don’t remember entering and winnings from foreign lotteries should be avoided.
Rolling lab scams
The mobile diagnostic lab is an important source of medical testing for many seniors. Rolling labs make health care more accessible but can also be the site of major health insurance scams. Sometimes, these labs bill health insurance companies for unnecessary or fake tests before performing expensive procedures. A victim may be left with drained coverage, increasing co-pays, and false medical records, which can be financially and emotionally draining. Keeping detailed records, reviewing billing and summary statements, and knowing your insurance coverage will help you avoid these scams.
The Grandparent scams usually involve a con artist posing as a target’s grandchild or someone who knows the grandchild. They take advantage of grandparents’ love for their grandchildren. It is common for the con artist to call the target on the phone and explain that they are in trouble, desperate for money to cover some last-minute bill, bail, or other made-up expense, and need a wire transfer to get out of the situation as soon as possible. Before acting, verify the story with another family member or call the person directly at a known phone number to ensure you’re not getting scammed.
Social Security Advisory Board scams
A new government employee impersonation scam involving the Social Security Advisory Board was reported by the inspector general of Social Security in May 2019. Scammers call individuals with the phone number of the board. The scammer then attempts to obtain the individual’s personal information, including their Social Security number, birth date, and address. In his report, the inspector general stressed that the board never solicits information from the general public over the phone and that government employees never take a threatening approach. You’re being scammed if either of these things happens to you.
Con men use sweetheart scams to gain their targets’ trust and create the illusion of happy, normal relationships by posing as loving, attentive, potential suitors. The scammers use trust to convince their victims to divulge banking or other personal information before draining the accounts. No matter how much you care for someone, you should never send money to someone you haven’t met in person.