It’s a sad fact that when you’re older, con artists put a target on your back.
That’s because seniors are more likely to have substantial savings, own their homes and have excellent credit. Many were raised to be polite and trusting. Retirees also may be lonely or experiencing cognitive decline.
Scammers smell opportunity — and cheat older Americans out of a staggering $36.5 billion each year, a 2015 study from True Life Financial found.
Don’t become a victim. Here’s what you need to know about 10 of the most common senior financial scams — and how to fight back.
Don’t become a victim. Here’s what you need to know about 10 of the most common senior financial scams — and how to fight back.
1. Medicare scams
Fraudsters love manipulating the Medicare system.
Posing as representatives of the government health care program, they may call or email older people to fish for personal information that they can use to commit identity theft.
Other scammers set up mobile units at fairs and churches and offer “free” screenings or exams. They obtain your Medicare information, submit bills for the services, pocket the money and skip town.
When it’s time to see your doctor for your annual exam or screenings, Medicare will deny your claim and say you’ve already had your covered services during the year.
2. Prescription drug schemes
When seniors search the internet for affordable prescriptions, they wander right into an online bazaar offering counterfeit drugs for all manner of ailments, including heart problems, cancer, diabetes and Alzheimer’s.
It’s a booming marketplace: Federal agents now pursue four times as many investigations into bogus medications each year as they did in the 1990s, the National Council on Aging says.
At best, counterfeit products won’t do anything at all for you. At worst, they could put your health or even your life at risk. Phony treatments have been known to contain paint, antifreeze or other harmful substances.
Obtain medicines only from doctors, or from sources they approve.
3. Natural disaster scams
Almost immediately after a devastating tornado, flood or other natural disaster, fraudsters go to work to take advantage of sympathetic seniors and other kind strangers who want to help.
You may be inundated with calls from bogus charities in the days following a disaster. Never give out your credit card number or other sensitive financial information to people who contact you out of the blue.
If you’d really like to provide assistance, contact a reputable charity.
Pick up the phone to call in with your donation, or give money on the official website.
4. Bereavement rip-offs
Some lowlifes target mourners.
Scammers comb the obituaries for the names of survivors. Then, they call or show up at funerals to exploit relatives by claiming the deceased owed them money.
Grieving seniors also can be preyed upon by disreputable funeral homes aggressively selling unnecessary services. For example, hucksters might imply that a pricey casket is necessary even for a cremation — which is not true in any state.
When you lose someone and need to make arrangements, take a friend along with you to visit funeral homes. And ask to see detailed price lists, because facilities are required to give those upon request.
5. Telemarketing scams
Telemarketing calls aren’t just annoying, but they also can be scammy — especially when an elderly person answers.
Con artists convince seniors that they represent charities. They collect good-faith deposits to track down large sums of money their victims are supposedly owed. They’ll trick a retiree into wiring funds by claiming a family member is in the hospital and needs money.
Don’t fall for threats, aggressive sales pitches or offers that sound too good to be true. And never provide personal or financial information to someone who calls you.
The Federal Communications Commission recommends that if you have caller ID and don’t recognize a number, don’t answer. Anyone who really knows you will leave a message.
6. Internet fraud
Cyber thieves use realistic pop-ups to warn you that your computer has been compromised. If you click, you’ll be urged to purchase fake anti-virus software.
Also beware of what are called phishing emails, which look just like alerts from your bank, credit card company, energy provider or favorite online retailer. Most phishing emails ask you to follow a link and update your account information — for the scammers.
Or, you may get emails that appear to be from the IRS demanding back taxes. Phishing emails tend to look alarming. Misspelled words, capital letters and excessive use of punctuation are common. Simply delete them.
You can pinpoint the source of a link by hovering your mouse arrow over it without clicking on it. If it’s phony, it will contain an unfamiliar name or look like gobbledygook. Just trash the email.
7. Sweepstakes and lottery scams
These rip-offs target seniors by phone or through the mail. You might receive a call announcing that you’ve won a large sum of money or some other prize. All you have to do is provide personal information and a credit card number to claim it.
Or, a legitimate-looking check shows up in your mailbox with a notice that you’ve won a big prize. So, you deposit the check and think about how you’ll use the money once it clears.
Meanwhile, you get a congratulatory phone call — from the scammer, asking for credit card information to pay taxes or fees on your prize. And in a few days, the check bounces.
No legitimate contest operates that way.
8. Granny scams
Scammers know there’s a good chance their elderly targets are grandparents. The call goes something like this:
“Hi, Grandma. Guess who this is.”
“Yes. Can you send money to Western Union? I’m behind on my rent. Please don’t tell Mom and Dad. They’ll be so mad that I bothered you.”
This scheme has been around a while, but the Federal Trade Commission says a new twist has seniors increasingly mailing large amounts of cash — typically around $9,000 — to people claiming to be their grandkids.
The FTC says don’t act on emotion but try to call the grandchild on your own. Or, see if you can check out the story with someone else in the family, not necessarily “Mom and Dad.”
9. Investment fraud
Con men and women know that seniors want to grow their retirement savings. They usually call or send unsolicited emails pitching stocks they say have phenomenal returns.
Before you invest in anything, verify the information you were given by checking the company’s financial statements.
You can call your state securities regulator, or check the EDGAR database on the Securities and Exchange Commission’s website.
“Remember that a fraudster does not want you to think too much about the investment because you might figure out the scam,” the SEC says, on its website.
10. Homeowner scams
Scam artists know that many older people own a very valuable asset: their own homes. Don’t fall prey to swindlers looking to capitalize on the substantial investment you’ve made to put that roof over your head.
Be wary of anyone who pressures you to get a reverse mortgage and stands to benefit if you do.
Watch out for home repair outfits that contact you directly and offer to arrange financing, and be careful when supposed county assessors offer to reassess your property for a sizable fee.
Report fraud when it happens. Usa.gov has a list of scams broken down by category, with links or phone numbers so you can notify the proper agency.
Equifax, one of the three major credit reporting agencies in the U.S., announced a data breach that affects 143 million consumers. The hackers accessed Social Security numbers, birthdates, addresses, and driver’s license numbers.
Equifax has launched a tool that will let you know if you were affected by the breach. Visit Equifax’s website dedicated to this breach to learn if you were impacted. You will need to provide your last name and the last six numbers of your Social Security number.
If you are impacted, Equifax offers you a free credit monitoring service, TrustedIDPremier. However, you won’t be able to enroll in it immediately. You will be given a date when you can return to the site to enroll. Equifax will not send you a reminder to enroll. Mark that date on your calendar, so you can start monitoring your credit as soon as possible.
If you detect suspicious activity on your credit report due to the breach, learn how to report itimmediately.
Scams affect every part of life. These people try to trick you out of your personal information and your money. The most common types of fraud fall under these categories:
- Housing and Mortgage
- Mass Marketing
- Postal Mail
- U.S. Citizens Abroad
The Financial Fraud Enforcement Taskforce and the offer overviews of other types of fraud, plus what to do if you are a fraud victim.
Get the information you need to protect yourself from being a victim of the latest scam tactics:
- Advance fee scams – Don’t fall for claims that you have won a lottery, prize, or can invest in a great opportunity, if you have to pay a small fee in advance.
- Chain letters – These letters promise to help you get rich quickly if you participate and forward the letter on to your friends and family.
- Charity scams – Scammers take advantage on your willingness to help people in need and charitable causes. They may collect your donation and keep it for themselves instead of using it to help those in need..
- Dating scams – Scammers may create fake profiles on online dating sites and express interest in you, just so he or she can convince you to send them money.
- Debt relief scams – Some scammers hope that you are as eager to get rid of your debt as they are to scam you out of your money. Know the warning signs so you won’t be their next victim.
- Free security scans – Don’t be tricked by messages on your computer screen that claim that your machine is already infected with a virus. The realistic, but phony, security alerts exploit your fear of online viruses and security threats.
- Government grant scams – Despite ads that say you qualify for a government grant, these are often scams. Be wary of responding to offers, email, or claims that use government agency names.
- Health fraud scams – Be wary of trusting all claims. Take time to get the facts about a product first.
- International financial scams – A variety of scams offer entries into foreign lotteries or international investment opportunities.
- IRS-related scams – Be careful with email that is supposedly from the IRS. Scammers try to gain access to your financial information in order to steal your identity and assets.
- Job scams – Be wary if you have to pay money or supply your credit card number to a company to apply for a job. Some scammers make big promises with work at home opportunities, but these may require you to engage in illegal activities.
- Jury duty scams – Someone calls pretending to be a court official who threatens that a warrant has been issued for your arrest because you failed to show up for jury duty.
- Mass Mailing Fraud – You receive a letter promising wealth or good fortune.
- Military romance scams – Watch out for people pretending to be members of the U.S. military. These scammers will try to get in an online relationship with you on social media or a dating website. They’ll then ask for money for fake service-related needs, like travel costs or medical fees. Learn how to locate U.S. military personnel and veterans to verify if someone is in the military and help avoid these scams.
- Phantom debt scams – Beware of letters and calls, supposedly from “debt collectors” or “court officials”. These scammers make threatening claims requiring you to pay money that you don’t owe.
- Pyramid schemes – These investments offer big profits, but really aren’t based on revenue from selling products. Instead, they depend on the recruitment of more investors.
- Scams that use the names of the FBI or CIA – Avoid falling victim to email schemes involving unsolicited email supposedly sent by the Federal Bureau of Investigation (FBI) and/or Central Intelligence Agency (CIA). The email appears to be sent from email addresses such as firstname.lastname@example.org, email@example.com, firstname.lastname@example.org, and email@example.com.
- Service members or veteran scams – Scammers target bogus offers of government resources or financial services to trick active duty military personnel and veterans out of their money.
- Smishing, vishing, and phishing – All three of these scams rely on you replying to an email, phone call or text with personal information, such as your bank account or credit card numbers.
- Social Security imposter scams – Someone calls you, posing as a Social Security investigator. This person claims that there is a problem with your social security account. They then tell you to call another number to resolve the problem.
- Subpoena scams – Scammers send bogus email, supposedly from a U.S. District Court, stating that you have to come to court. These messages are fake and may contain links that are harmful to your computer.
- Tech support scams – Scammers pretend that there is a problem with your computer and then try to convince you to pay them to fix it.
- Text message spam – Not only can text message spam be annoying and cost you money on your mobile phone bill, but the messages are often for scams.
With so many kinds of scams and fraud, it’s hard to figure out where to report each type. First, file a report with your local police department. You may also contact your state consumer protection office. You can also report certain types of scams and fraud to federal enforcement agencies. Federal agencies usually can’t act on your behalf, but they can use complaints to record patterns of abuse. This helps them take action against a company or industry. Contact these federal agencies based on the type of fraud:
- Common scams and fraud – Contact the Federal Trade Commission (FTC) or use the Online Complaint Assistant to report various types of fraud, including counterfeit checks, lottery or sweepstakes scams, and more.
- Census fraud – Contact your regional office of the Census Bureau about scammers who pretend to collect your personal information for the government.
- Food stamp (SNAP) fraud – File a report with the USDA’s Office of Inspector General about individuals or retailers committing fraud in using, selling, or accepting SNAP benefits.
- Financial fraud including credit, loans, and mortgages – Contact the Consumer Financial Protection Bureau about problems with mortgages, credit and loan-related fraud including money transfers, student loans, credit reports, and other financial services.
- Identity theft or data breaches – Report identity theft, when someone steals your personal information to apply for credit, file taxes, and commit other fraudulent acts, to IdentityTheft.gov. This service can also help you develop a recovery plan.
- Immigration fraud – Report the illegal use of documents or illegal actions to get around U.S. immigration laws to U.S. Immigration and Customs Enforcement.
- International scams – File a complaint about e-commerce (business or trade that takes place on the internet) or travel scams to econsumer.gov.
- Internet fraud – Submit a complaint to the Internet Crime Complaint Center (IC3) about phishing or spoofing, when a scammer uses fake email, text messages, or copycat websites to try to steal your identity or personal information. You can also report malware, dangerous software designed to disable computers and computer systems, and other related issues to the IC3.
- Investment fraud – Contact the Securities and Exchange Commission or your state’s securities regulator about scams related to offers using fake claims to get someone to invest.
- IRS and other government imposter scams – Report someone pretending to be from the IRS to the Treasury Inspector General for Tax Administration (TIGTA) or by calling 1-800-366-4484. File a complaint about other government imposter scams with the Federal Trade Commission.
- Mail fraud – Contact the U.S. Postal Inspection Service about scams or deceptive ads delivered through postal mail, stolen mail, and other related fraud.
- Medicaid fraud – File a Medicaid fraud complaint with your state’s Medicaid program office. Use the Fraud and Abuse Reporting Directory (PDF, Download Adobe Reader) to find the contact information for your office.
- Medicare fraud – File a report with the Department of Health and Human Services’ (HHS) Inspector General about scammers who try to get your personal information or Medicare number to steal your identity and commit Medicare fraud.
- Misuse of federal funds – Contact the Government Accountability Office through their FraudNet form.
- Moving fraud – To report a dishonest moving company within the same state, file a complaint with your state utility commission. For complaints about interstate moving services, file a report with the Federal Motor Carrier Safety Administration.
- Social Security fraud – File a complaint with the Social Security Administration’s Inspector General about alleged fraud, waste, or abuse.
- Telephone scams – Submit a complaint to the Federal Communications Commission about mysterious charges on your bill (cramming), an illegal switch of your service (slamming), or other unwanted calls including telemarketing.
- Welfare (TANF) fraud – Contact your nearest welfare agency or call the HHS Inspector General at 1-800-HHS-TIPS (1-800-447-8477) to report program fraud or abuse.
Reporting fraud may not recover everything you lost, but it does improve your chances of getting some of it back and avoiding future losses. It also helps law enforcement authorities stop scams before other people become victims. Learn the warning signs of common scams and fraud to protect your personal and financial information.
Report suspected tax fraud to the Internal Revenue Service (IRS). You may be eligible to claim a Whistleblower Informant Award for reporting the fraud. Report state tax fraud to your state’s department of revenue or other tax authority.
Tax-related identity (ID) theft is another form of tax fraud. It happens when someone steals your Social Security number to get a tax refund or a job. Report this type of fraud using IRS form 14039(PDF, Download Adobe Reader).
If you receive threatening calls or emails claiming to be from the IRS, report the fraud to the IRS online or by calling 1-800-366-4484. Forward any website links that claim to be the IRS, but don’t start with “www.irs.gov” to firstname.lastname@example.org.