Elder Fraud Expert Answers: What are the Most Common Schemes?
In our previous blog we talked about why senior citizens have become such a target for con artists and even unscrupulous relatives to commit elder fraud and take their hard-earned money. We also talked about signs that they may be being duped. Today, we want to make you aware of the variety of schemes that are out there. This is by no means a complete list, but will give you a pretty good idea of what to watch for.
- The “Grandparents Scam”: someone phones or e-mails and pretends to be a grandchild in trouble. The elderly person, who may not have much contact with their grandchild, might be convinced and may wire money or send a prepaid debit card to help.
- Offers of “freebies”: the Better Business Bureau of eastern Michigan reports that scammers now are offering seniors $3,000 in “free groceries savings certificates” along with a free medical alert bracelet. The scam may lure people to give away bank account information.
- Enticing links on websites lure inexperienced seniors into divulging personal information.
- Con artists may attend the funeral service of a stranger claiming that the deceased had an outstanding debt with them.
- Reverse mortgage scams: the FBI reports that victims are offered free homes, investment opportunities and foreclosure or refinance assistance.
- Thieves steal personal information and contact the Social Security Administration to change the payment routing information to the thieves’ own bank accounts or prepaid debit cards.
- Fake lottery/sweepstakes: seniors are enticed into buying inexpensive knick-knacks or magazine subscriptions (which they do receive) in order to be entered into a contest. Another variety is they receive an official looking check saying they’ve won a foreign lottery. In both cases, they are asked to give up personal information to proceed.
- The discount prescription scam: seniors are offered prescription drugs at a significant discount, but are required to pay a $200 membership fee or give up their credit card information.
- The “credit card company” calls: a polite caller says he’s from the senior’s credit card company and is investigating a possible fraudulent purchase. He even IDs the last four digits of the charge card as proof. When the senior denies making the purchase, the caller offers to reverse it immediately, but asks for the verification code on the back of the credit card.
- Door-to-door solicitors ask for donations on behalf of charitable organizations.
- Telemarketing fraud: according to the National Consumers League, nearly a third of all victims are age 60 or older. Studies by AARP show that most older telemarketing fraud victims don’t realize that the voice on the phone could belong to someone who is trying to steal their money.
- Medical Equipment Fraud: equipment manufacturers offer “free” products, such as wheelchairs or oxygen tanks, to individuals. Insurers are then charged for products that were not needed and/or may not have been delivered.
- “Rolling Lab” Schemes: unnecessary and sometimes fake tests are given to individuals at health clubs, retirement homes, or shopping malls and billed to insurance companies or Medicare.
- Services Not Performed: Customers or providers bill insurers for services never rendered by changing bills or submitting fake ones.
This list truly only scratches the surface of what is out there, but it gives you a good idea of just how vigilant seniors and their caretakers need to be. In our next blog, we will provide a list of what seniors need to do to prevent becoming a victim of scams and what to do if it does happen to them.
John Sileo is an author and highly engaging speaker on fraud, internet privacy, identity theft and technology security. He is CEO of The Sileo Group, which helps organizations to protect the privacy that drives their profitability. His recent engagements include presentations at The Pentagon, Visa, Homeland Security and Northrop Grumman as well as media appearances on 60 Minutes, Anderson Cooper and Fox Business. Contact him directly on 800.258.8076.