My wife and I are in our (very) early 70s, but we are quite active and engaged (70 is the new 50, right?) and consider ourselves financially astute. Even still, we recently suffered the hack of our personal bank accounts.
While I was away on business, my wife received a text message from “the bank” alerting her to a suspicious charge. The message included a link and instructions for her to log in to confirm the transaction. With the exception of that link and instructions, the text message looked exactly like previous messages from the bank. The charge was large enough to cause a mild panic, so my wife dutifully clicked the link and entered her login credentials. Only after she entered her information did she become suspicious of the website. As you might suppose, the text was fake, and the scammers now had the login information she just entered. In less than an hour, five transfers (ranging from $90 to $2500 each) had been processed out of our account.
Fortunately, we quickly identified the fraudulent transactions, alerted the bank, and (after a couple of nail-biting days) recovered our funds. Anyone who uses electronic devices (computers, smartphones, tablets, etc.) is a potential victim of these scams. Senior citizens make up a larger share of victims because they can be less experienced with technology, are generally more trusting, and likely have more money to be scammed out of.
How can you protect yourself or your loved ones? Follow these three steps:
1.) Be on guard
According to the latest data from the FBI’s 2022 Elder Fraud Report: “In 2022, total losses reported to the IC3 [Internet Crime Complaint Center] by elderly victims increased 84% from 2021.”1 Monetarily, this represents a $3.1 billion hit, and these figures may not include those unaware of the scams or too ashamed to report them.2
My wife was chagrined by her lapse since I preach online safety night and day, but it could happen to anyone, and scammers’ methods are becoming increasingly sophisticated and diverse.
Always pause before you click a link, answer a call, share information, download software, or open an email. If something seems off, ask someone you know and trust to verify. Don’t be fueled by fear. Take a deep breath and a moment to think. Scammers might even try to convince you that you’ve already fallen victim to a scam, and they can be your hero come to help – not true!
2.) Understand the scammers’ methods
The following are some of the primary scams being used now to defraud elders, as reported in the 2022 Elder Fraud Report. Beware!
- Tech or Customer Support Scams: This may be as simple as a call from “tech support” informing you that your computer has a virus. Sometimes a pop-up message or blank screen on a computer tells the victim their device is damaged and needs fixing. A phone number to reach “tech support” (actually the scammer) is provided.
The “tech support” scammers will claim they can fix your computer, but what they really want is to snoop around your device for relevant financial information they can use to steal your money. They may ask you to download “software” that is actually malware used to track your every move on the computer.
- Investment Fraud: The FBI’s 2022 Elder Fraud Report shares that “The scammers aim to gain the victim’s trust and offer an opportunity to invest in a low-risk, and unusually high-yield type of scam.”3 If you’re every unsure about an opportunity, talk to a trusted advisor. He or she understands what a legitimate investment looks like.
- Lottery/Sweepstakes/Inheritance Fraud: This scam falsely notifies individuals that they have won a cash prize or will receive an unexpected inheritance, but you'll have to give something before you can get anything, a major red flag of any “gift.”
- Sweetheart Scams: Love clouds judgment, and the elderly are especially ripe for abuse if they are lonely and their judgment isn’t as sharp as it once was. If you meet a “sweetheart” online that is asking for money (even for seemingly good reasons), they likely aren’t who they say they are, no matter how great they seem.
- Government Impersonation Scam: Scammers call unsuspecting older adults and pretend to be from the IRS, Social Security, or Medicare. These organizations never make unsolicited phone calls. Hang up the phone.
- Grandparent Scam: You may get a call that goes like this: “Hi, Grandma. Do you know who this is?” When you guess the name of the grandchild the scammer most sounds like, the fake grandchild (the scammer) then asks for money to solve some urgent financial problems (such as overdue rent, car repairs or bail bonds).
3.) A small dose of prevention goes a long way
If any phone call or request looks out of the ordinary, that should be a red flag. It may turn out to be legitimate, but if not, caution and an ounce of prevention are worth their weight in gold.
- Designate a trusted contact. This person has no authority over your accounts but is someone your financial institution can contact if they suspect something is awry. Credent Wealth Management prioritizes setting up trusted contacts.
- Be leery of unknown phone numbers. Signing up for the National Do Not Call Registry will reduce telemarking calls, but it does nothing to stop scammers. If you don’t recognize the number, be leery about who may be on the other line.
Did the call come from a recognized firm you conduct business with? It may or may not be legitimate. It’s OK to call the company back using a phone number that you know is legit.
- Freeze your credit report with the three major credit rating agencies at no cost. This helps prevent accounts from being opened in your name without your knowledge. When the need arises, you may temporarily remove the freeze.
- Continue to learn. The FBI releases yearly reports with updated information about what you need to know to protect yourself and your loved ones. Read up on the latest scams and next steps for protection.
At Credent, we go to great lengths to secure the assets you have entrusted to us, but doing everything you can to prevent fraud is essential. Sadly, in this day and time, a healthy dose of skepticism is just what the doctor ordered!
If you have additional questions or concerns about financial fraud or other financial topics, your Credent team is here to help. Reach out to us at email@example.com
- Federal Bureau of Investigation, Internet Crime Complaint Center, “Federal Bureau of Investigation Elder Fraud Report 2022,” p. 3
- Federal Bureau of Investigation, Internet Crime Complaint Center, “Federal Bureau of Investigation Elder Fraud Report 2022,” p. 4
- Federal Bureau of Investigation, Internet Crime Complaint Center, “Federal Bureau of Investigation Elder Fraud Report 2022,” p. 13