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Elder Fraud Expert Answers: How do I prevent & resolve it?

seniors on computerThe past two blogs have outlined why seniors are targeted, what signs to watch for, and some common schemes.  Now for the truly important info: How to prevent elder fraud from happening and what to do if it does happen!

  • Report actual or attempted elder fraud (or any type of fraud) via Fraud.org’s Online Complaint Form.
  • Change the phone number if a senior is receiving excessive sales calls.
  • Change the bank account or credit card numbers if they have fallen into the hands of thieves.
  • Avoid getting on sucker lists. Don’t fill out contest entry forms at fairs or malls—they are a common source of “leads” for con artists. Ask companies you do business with not to share your personal information with other marketers.
  • Know your “Do-Not-Call” rights. Under federal law, you can tell a telemarketer not to call you again and you can file a complaint on the Do Not Call website.
  • Make sure you know the company you are dealing with. If it’s an unfamiliar company or charity, check it out with your state or local consumer protection agency and the Better Business Bureau.
  • Screen your calls. Use an answering machine, Caller ID, or other services that may be available from your phone company to help you determine who you want to talk to and who you want to avoid.
  • Never sign blank insurance claim forms.
  • Never give blanket authorization to a medical provider to bill for services rendered.
  • Ask your medical providers what they will charge and what you will be expected to pay out-of-pocket.  Get it in writing.
  • Carefully review your insurer’s explanation of the benefits statement. Get an annual “Benefits Request Checkup” from your insurance provider to see a list of all benefits and services paid in your name.  Call your insurer and provider if you have questions.
  • Do not do business with door-to-door or telephone salespeople who tell you that services of medical equipment are free.
  • Give your insurance/Medicare identification only to those who have provided you with medical services.
  • Keep accurate records of all health care appointments.
  • Use caution when purchasing drugs on the Internet. Do not purchase medications from unlicensed online distributors or those who sell medications without a prescription. Reputable online pharmacies will have a seal of approval called the Verified Internet Pharmacy Practice Site (VIPPS), provided by the Association of Boards of Pharmacy in the United States.
  • Always ask for and wait until you receive written material about any offer or charity. If you get brochures about costly investments, ask someone whose financial advice you trust to review them.  Remember, even a classy brochure can be a hoax!
  • Always take your time making a decision. Legitimate companies won’t pressure you to make a snap decision.
  • Don’t pay for a “free prize.” If a caller tells you the payment is for taxes or shipping fees, he or she is violating federal law.
  • Never send money or give out personal information such as credit card numbers and expiration dates, bank account numbers, dates of birth, or social security numbers to unfamiliar companies or unknown persons.
  • Get a second opinion!  When filling out important forms or making a big financial decision, ask someone you trust to look it over and talk it over before giving away any personal information.
  • Get help when using the internet, especially concerning financial transactions.  NEVER give out personal information such as SS numbers or credit card information. Remember that older grandkids make great resources when it comes to using the Internet because they are true digital natives.

Remember, you’ve worked hard to reach a point where you can enjoy your golden years.  Don’t let someone else enjoy the fruits of your labor.  Be vigilant and be protected!

John Sileo is an author and highly engaging speaker on business 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 MinutesAnderson Cooper and Fox Business. Contact him directly on 800.258.8076.

Elder Fraud Expert Answers: What are the Most Common Schemes?

senior on internet ccIn 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.

Common schemes:

  • 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 MinutesAnderson Cooper and Fox Business. Contact him directly on 800.258.8076.

Elder Fraud Expert Answers: Why Are Senior Citizens Targeted?

senior id theft1

Imagine spending your whole life working hard, saving wisely and spending conscientiously—only to have your comfy “nest egg” taken away by unscrupulous scammers or even your own greedy relatives in your golden years.  Sad to say, this is a scenario that is far too common; up to 80% of scam victims are over 65, according to the U.S. Federal Trade Commission. A 2009 study by MetLife’s Mature Market Institute estimates that seniors lose approximately $2.6 billion per year to elder fraud, or what they call financial abuse, meaning fraud by outside scammers or theft by family members and acquaintances.

And this issue will take on even more importance in the years to come as the senior population in America grows.  According to the U.S. Census Bureau, there were 37.3 million people 65 and older in the United States as of 2006.  This group is expected to double in size within the next 25 years. By 2030, almost 1-out-of-5 Americans – some 72 million people- will be 65 years or older.

A scan of recent alerts from the Senior Journal shows a wide variety of areas that require constant vigilance:

By definition, Elder Fraud targets seniors, but why?

  • Senior citizens are most likely to have significant savings, to own their home and/or to have excellent credit—all very desirable to criminals.
  • People who grew up in the 1930s, 1940s, and 1950s were generally raised to be polite and trusting.  They are less likely to be suspicious of a nice salesperson, say no or hang up on pushy telemarketers.  There is even a study showing that we get more trusting as we age.  Through MRI testing, researchers at  the University of California, Los Angeles found that the area known as the anterior insula, which is associated with “gut feelings,” became more active in the younger subjects at the sight of an untrustworthy face. Older subjects, however, showed little to no activation in this area.
  • Seniors can be less comfortable with technology and inadvertently share information online or click on links that makes them vulnerable.
  • Criminals know that seniors are less likely to report a fraud.  This could be either because they don’t know who to report it to, are too ashamed at having been scammed, or don’t even know they have been scammed. Many are afraid to appear as if they have lost the ability to make sound decisions to their relatives, so they just keep it to themselves.
  • If an elderly victim does report the crime, scammers know that they often make poor witnesses.   The effect of age on memory combined with the amount of time that often passes between the crime, the realization, and actually acting on it makes it difficult for elderly victims to supply enough detailed information to investigators.
  • Senior citizens are more interested in and susceptible to products promising all sorts of wonderful results, from anti-aging creams to improved memory to medical cures.  In a world full of the miracles they’ve witnessed in their lifetimes, nothing seems too good to be true.  And if they can get a bargain on it, so much the better!

Elder Fraud Warning Signs:

  • You notice an excess amount of ATM or bank account withdrawals, perhaps even exceeding the daily maximum allowed on that account.
  • The senior is bouncing checks, which might indicate an unexpected loss of money.
  • There are debit transactions that don’t seem to make sense for an older adult.  Also, there may be debits that the person can’t remember or explain.
  • The older adult may be suddenly wiring large sums of money or writing large checks.
  • He or she may close a certificate of deposit, even though a large penalty would be paid for early withdrawal before that CD matured.
  • The bank is unable to speak directly with the older adult, despite repeated attempts to contact him or her.
  • A “new friend” suddenly begins handling the money for a senior.
  • The senior receives excessive amounts of junk mail.  (Once a senior takes the bait for one scam, thieves sell the person’s name, address and telephone number, and fake mailings proliferate.)
  • The phone rings excessively with sales calls.
  • He or she may be having difficulty buying groceries and paying bills.
  • They seem to receive lots of cheap items such as costume jewelry, beauty products, water filters, and knick-knacks that they bought to win something or received as prizes.

Tomorrow, we will outline common schemes that are used to prey on senior citizens.

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 MinutesAnderson Cooper and Fox Business. Contact him directly on 800.258.8076.