Family members are unable to be by their elder's side 24/7. As technology has enabled us to be more "wired" and connected, this has also enabled scammers to be more efficient. The creation of multiple direct mail advertisements, emails, phone calls and sales promotions by companies, in order to sell their services or products makes it tough to sift the good from the bad. However, there are some clues that will quickly allow you to identify a scam that could be targeting seniors.
In 2011 the Federal Trade Commission estimated that 2.7 million seniors ages 65 and older, and 4.6 million people 55 and older, were victims of fraud. As 79 million Baby Boomers are coming into retirement age themselves, that figure is only expected to increase.
The most common types of senior-targeted scams are:
Power of Attorney scam: Often times a family member (one that is not usually close with the senior) will be placed as Power of Attorney (P of A) during a medical emergency or sometimes underhandedly. This person, as Power of Attorney, will have the power to begin re-allocating investments and savings without the elder's knowledge. If this person does not have the senior's best interest in mind, they could drain their accounts, leaving the burden of care on another family member. Financial exploitation is one of the most common types of elder-fraud and requires entire families to be vigilant in the decision-making processes of an elder's finances. Having checks and balances with multiple individuals involved will prevent fraud in this area. You can also appoint an estate attorney or elder law attorney to be the actual Power of Attorney instead of a family member. In addition, you can create a Living Will and Trust that has to be followed by the Power of Attorney and this also will eliminate inproper behavior.
Sweepstakes and Charities: These are most commonly initiated through direct-mail or telemarketing. The sweepstakes winner scams and fake charities seek to swindle seniors under the guise of taxes or charities. As professional marketers, they will call multiple times and many lonely seniors will eventually listen to them. Sweepstakes scams often tell the senior that they won, but must pay federal taxes before they can access the HUGE prize money, and informs the senior not to tell anyone because it would be a great surprise. They'll also focus on building relationships with your senior, often calling multiple times and daily. Charities ask for donations to certain causes that, at face value, seem charitable and gracious, but are all-too-common fake companies. The money goes straight into the pockets of the scammers.
Cling-ons: There are still some scam artists who move from city to city or neighborhood to neighborhood befriending seniors through church groups or support groups. After taking some time and becoming friends with the seniors, they will begin asking for small loans and eventually large investments that “cannot fail or miss”. Then they will disappear, having used their friendship with a senior to drain their bank accounts and move on to a different city under a different name. Always be aware of anyone new who has entered your senior loved-ones life. While some may be there for the right reasons, some may not be.
Medicare Telemarketing Scams: Using Medicare as a pretext to gain information, these scammers will call sounding very official and say that the senior's Medicare information has been compromised or that they qualify for a new benefit. If anyone calls asking for your Medicare number, a senior should hang up. The federal government will not call a senior if there is an issue with their Medicare benefit, instead, they will first write a letter to notify you to take action. Other callers will use the guise of medical billing and ask for billing information outright. They take advantage of the fact that many seniors feel reluctant to hang-up on anyone and feel obligated to at least say hello and listen. Never give out Medicare information to a caller.
Ponzi Schemes: Though it may be the most well-known and highly publicized senior scheme, ponzi scheme fraud is still occurring rather frequently in the United States. Generally advertising themselves by offering a “free lunch” or a “no obligation seminar” will sell the seniors who often have plenty of free time on their hands. These schemes often pitch “highly profitable” investments that “guarantee” returns of 30% or more in a year. Strong and targeted pitches spoken by sly and charming salespeople often convince seniors to invest their money on-site, and only a few weeks later do they realize that their investments and the organization were fake and now long gone.
No one wants to see seniors taken advantage of in these ways, but prevention can be tough if there is not 100% contact and clarity 24 hours a day, 7 days a week. Seniors have a lot of time on their hands and often feel neglected, a feeling that scam-artists often exploit.
Grandma Scam: These scammers monitor your Facebook pages and gain information about your aging relatives, ideally your Grandma or Grandpa. Then they call your Grandma or Grandpa, and with the information they know about you they tell them that you are in a situation where you need money wired to you. They can easily convince your senior relative that they are a good friend of yorus because they know so much information about you. They may say you have had your purse or wallet stolen or that you have been involved in an accident or robbery. Be careful of placing too much information about your relatives on your Facebook pages. Also be careful of using unsecured wireless connections where some of these scammers, operating in foreign countries, will enter to take your information and even pose as you when reaching out to your relatives for financial assistance.
Here are a few simple ways to prevent elder fraud and protect the senior you care for:
Daily contact- Speaking with your senior loved ones at least once a day is a good way to keep tabs on what they are doing, who they are spending their time with and what they care about. The more you can physically be with them or see them the better, but speaking once or twice a day will help to make sure you know what is going on in their lives.
Help with bills and mail: Assisting with the financial organization will make sure payments are made on time and junk mail is tossed. It will also allow you to be informed about what they are spending their money on and to quickly see if there are any inappropriate payments. If they have signed-up to make donations to something new, you will instantly be able to review it to make sure it is a legitimate charity.
Ask questions: The more you ask the more they'll tell you, about who they ran into at the store, what is going on in church, and who they talked with on the telephone. Asking questions isn't just the best way to monitor, but also to keep them feeling needed or cared for. It's simple and easy to do and can reveal so much more about your senior, your family and what you care about.
Help stop scam artists and senior fraud by being connected, informed and a gate-keeper for your senior. In doing so you'll prevent the burden of debt-transfer, embarrassment and guilt. Boomers didn't grow up saying “no” as aggressively as younger generations and it is important to communicate new scams to your senior loved ones.
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About the Author:
George Shaw is a writer and family coordinator and counselor for the senior home
and senior care fields.