Because it is likely that most senior and elderly citizens generally have an “eggs nest”, own their own home, have stocks and access to credit, they are potential targets for fraud and scams. Older Americans are less likely to hang up on a caller, more likely to listen, and less likely to report issues involving a fraud or scam. Once taken advantage of they are also less likely to report the scam or fraud. An effective con man or woman will take advantage of these traits to exploit an elderly person. It is also common that an elderly victim does report the crime because they feel they will be a poor witness or they are embarrassed.
Con artists know the effects of age on memory, and they are counting on elderly victims not being able to supply enough detailed information to investigators. It can also take a victim a very long time to become aware of the fact that they have been the victim of a crime. It is also the case that senior citizens are more interested in and susceptible to products promising increased to improve their cognitive functions, physical well-being or living conditions.
Fraud and scams against elders are growing faster than ever before. In broad terms financial elder abuse is when someone illegally or improperly uses a vulnerable senior’s money or other property. Most states now have laws that make elder financial abuse a crime and provide ways to help the senior and punish the scammer.
If you are a senior citizen who feels they have been victimized, or you feel a family member who is elderly has been victimized, contact a senior law attorney for advice. Elder financial abuse is difficult to fight if it is not reported. As we said, many elderly victims are often too confused, fearful, or embarrassed by the crime to report it. Consumers Digest has estimated that there are at least 5 million cases of this financial abuse in the United States each year, but law enforcement or government officials learn about only 1 in 25 cases.
The best way to protect yourself and your family members from financial fraud and scams is to understand them and the signs that they are occurring. You can learn about elder financial abuse and fraud by reviewing information provided by the AARP. Because elders expect honesty in the marketplace they are less likely to take action and less knowledgeable about frauds and scams. They should be warned to question telemarketers they speak with and people who visit them at home soliciting business. One approach of a scammer or fraud is to take advantage of the isolation experience by an elderly person and their need for attention and company. So con artists will often pose as trustworthy caregivers or help. Sometime the scammer will be a family member or friend who is having financial problems particularly if they are encountering unemployment, gambling issues, drug problems or other legal problems themselves.
Elder financial abuse scammers can be tough to catch. Many scammers have paperwork that appears to give them legal authority to act — including powers of attorney, authorizing signature cards, and vehicle pink slips. Some work at a bank or other financial institution and have intricate ways of hiding their tracks by manipulating electronic records and such.
A fraud or scam against an elderly person can cover a range of situations from taking money by theft, to forging legal documents, to asking for a deed or will to be falsely signed, to offering to sell something not available to sell or which will never be delivered. They can also be a false appeal for financial assistance due to personal problems or a natural disaster which has never occurred. Other sources of fraud and scams are telemarketing and people who do mailings. It is estimated that as many as 1 in 8 seniors are cheated each year by frauds and con artists. Here are a couple of scams which are listed on the NOLO site.
Getting Unauthorized Access to Funds
In “Sweetheart Scams,” alleged suitors woo older people, convincing them that love and care are their motivations for being included on bank accounts or property deeds; the suitors usually disappear along with the property, charging excessive amounts of money. Smooth-talking scammers first convince seniors that they need some goods or services, and then seriously overcharge them — often hiding the high cost in extravagant schemes involving interest and installment payments. This tactic is often used for products that many older people might find essential to their quality of life, such as hearing aids and safety alert devices.
Selling Bogus Items
Among the most egregious of false sales ploys is dubbed “Rock in a Box.” In them, a senior is sweet-talked into buying an item, such as a new color television, at a bargain price, that comes in a box that’s suspiciously sealed. What the box actually contains is a well-padded rock.
Getting Money or Property Through Undue Influence or Fraud
Many seniors have been duped into parting with their homes or other property because a scammer convinces them it is for their own good. In one infamous case, three officials from the Detroit-based Guardian Inc. were found guilty of embezzlement and fraud after selling a client’s house for $500 to the mother of a company officer. The company also collected excessive fees from its wards, sometimes as high as 70 percent of their Social Security checks.
Using Fraudulent Legal Documents
Many scammers cloak their actions in legal authority, procuring a power of attorney or will or other legal document giving them access to a senior’s property. They get seniors to sign these documents by lying to, intimidating, or threatening the seniors.
Making Pigeon Drops
In a typical pigeon drop, two suspects approach an older person — often in a retail shopping area or near an ATM machine — and claim they have just found a package or wallet containing a large amount of money. One of the suspects volunteers to check with a “boss” offsite to get advice on what to do with the found money, and then reports that it came from an illegal source such as gambling or narcotics. The scammers offer to split the money — but only after the older person shows “good faith” by producing money of his or her own. When the scammers send the senior to the “boss” to get the promised share of the money, the senior discovers that there is no boss and the suspects have disappeared.
Faking an Injury Scenario
In this situation, a scammer claims to have a connection to law enforcement and tells an elder that a child or other close family member has been seriously injured or is in jail. The scammer then convinces the senior to give him or her money for medical treatment or bail.
Offering False Prizes
A good example of this is the “You have won the lottery” scam operating out of Canada. In this scam, thousands of older people were bilked into believing they became wealthy overnight, but had to wire money in “fees and taxes” before they could collect the grand prize. In a joint crackdown, the U.S. Attorney General and the Solicitor General of Canada estimated the take from this mass-marketing fraud to be about $1 billion a year.
In another version of this scam, con artists tell an elder that he or she has just won a huge cash prize, but needs to send in some money — usually in money orders — to free it up from customs officials.
Doing unsolicited home repair work
Typically working in teams of two or more, scammers scour neighborhoods with a high concentration of older residents, or even track recent widows and widowers through obituaries and death notices, then appear on their doorsteps claiming to spot something in need of fixing — a hole in the roof or clogged drainpipe, for example.
The scammers demand payment up front, and then often claim that their initial investigation reveals a more serious problem, with a more expensive solution. The “work” they do is unlicensed and often shoddy, such as applying paint to a roof to make it appear as if it has been tangibly fixed. In a twist on this scam, one alleged worker might distract the elder while another enters the house to steal money and other valuables.