Everything You Need to Know About Elder Fraud
Financial scams are widespread, meaning consumers always need to stay on guard when it comes to their personal finances. Yet the scale of elder fraud and financial abuse in the U.S. makes it difficult for older Americans to address all the risks that come their way. Whether through fake IRS phone scams or a deceptive marketing campaign, elderly Americans are often the target of con artists and financial fraudsters.
However, despite this reality, there are many tools and strategies available to seniors and their loved ones. Taking advantage of these resources is an important step for consumers as criminal tactics become more advanced and generational shifts mean more older Americans than ever may be at risk. According to the Population Reference Bureau™, the number of Americans aged 65 and older is expected to more than double to 98 million in 2060.
Combating elder fraud requires becoming educated on the topic and then pursuing measures to protect bank account and personal information. Read on for more information on everything you need to know about elder fraud:
Millions in self-reported losses a year
The first thing to know about elder fraud is that it is a big problem in the U.S - and growing even bigger. According to the Federal Trade Commission, American adults 60 years and older reported losing around $250 million due to fraud in 2017. But that number only tells half the story. The same FTC data indicated that adults 80 years and older lost an average of $1,092 per instance of reported fraud, almost double the next highest average ($621 for adults 70 – 79). Furthermore, seniors were the least likely age group to report fraud. While nearly a third of consumers 30 – 39 reported an incident in 2017, only 20 percent of those 60 – 69 reported fraud; this occurred despite that age group accounting for 19 percent of all reported cases.
These statistics underscore the reality that seniors are not only more vulnerable to fraud, but they are also often hit hardest by its financial impacts. This is compounded by the lower likelihood of self-reporting fraud, which only increases the risk older adults face.
How to identify and address the most common scams targeting seniors
Key to addressing elder fraud in real life is getting to know the usual suspects. There are many forms that senior financial abuse may take, but some of the most common actors to be aware of include:
Telephone and mail scammers.
Medicare scam operators.
Persons seeking or claiming to have the power of attorney or the legal authority to access or manage one’s money.
However, watching persons assumed to be close to seniors is important. Family, caregivers, and other relatives and friends may just as likely be after hard-earned money or personal information. A couple of the scams that are most commonly perpetrated to obtain such information or material gains include:
IRS phone scam: The No. 1 thing for any consumer — especially those who are seniors — to know is that the Internal Revenue Service does not and will not call you personally to demand immediate payment or face referral to law enforcement or some other form of punishment. The agency says so itself clearly, so be wary of anyone phoning that presents themselves as the IRS and demands such action. Never give out your Social Security number or credit card details over the phone to unknown callers.
Medicare fraud: This can come in different forms. For instance, criminals may steal Medicare insurance information to abuse directly through phishing scams or the like, while others operate seemingly legitimate services that will use your Medicare information to make bogus claims. Seniors may also be bombarded with marketing for medical equipment that could lead to financial fraud.
Know what makes a senior vulnerable
Barring serious illness, the Center for Retirement Research of Boston College® said most seniors are capable of handling their finances. If cognitive ability isn't at fault for financial loss, it becomes more important to identify root causes:
Telephone calls: A senior who receives several telemarketing calls a day is greatly exposed to potential fraud. Opting out of marketing lists and opting into Do Not Call lists is a necessary step to take.
Loneliness: Lack of social and emotional support leaves seniors isolated and without mechanisms of defense against financial predators. Those living alone, recently widowed or living far from close family need the most attention and should find services that help them protect their finances.
Yet even if all precautions and measures are taken, elder abuse can still happen. When, and if, it does happen, you or your loved one will need to know what actions should be taken in the aftermath. You can report instances of suspected fraud or abuse to the Consumer Financial Protection Bureau, the Better Business Bureau®, the Federal Trade Commission and state attorneys general offices. Also check with credit reporting agencies to ensure your information has not been used to open fraudulent accounts. You can even request a freeze on inquiries into your score, which could prevent further harm.
Whenever seeking ways to avoid elder fraud, talking to a financial partner is at the top of the list. Speaking to a reputable institution like Comerica Bank with proven tools and services can help connect seniors with the means they need to ensure their accounts and money are safe from the hands of prying calls and internet scams.
This information is provided for general awareness purposes only and is not intended to be relied upon as legal or compliance advice.
This article is provided for informational purposes only. While the information contained within has been compiled from source[s] which are believed to be reliable and accurate, Comerica Bank does not guarantee its accuracy. Consequently, it should not be considered a comprehensive statement on any matter nor be relied upon as such.