Especially in recent years, it has become the sad reality that fraudsters are increasingly targeting seniors. Due to their trusting nature, seniors are the common victims of these types of scams while scammers are getting cleverer in their illegal schemes. Although the awareness of financial scams has been on the rise, the number of scams has unfortunately risen as well. Between 2013 and 2016, the Treasury Inspector General for Tax Administration has become aware of over 5,000 victims who have collectively paid over $26.5 million as a result of a scam.
10 Common Scams
Like anything else, awareness of these financial scams is the best way to reduce your risk of becoming a victim. Here’s a list of the ten most common financial scams targeting seniors provided by the National Council on Aging:
- Health Care Scam: A scammer acts as a Medicare representative requesting personal information. In some cases, a scammer will contact the individual again at a later date saying that he/she spoke with a family member and that it’s alright to provide their personal information, which is then used to bill Medicare so the scammer keeps the money.
- Grandchild scam: “Hi Grandma/Grandpa, do you know who this is?” If you hear this, it is the first warning sign that this might be a scam. Once the grandparent provides a name, the scammer will then pretend to be that grandchild and ask for money.
- Telemarketing: When compared to the national average, seniors typically make twice as many purchases over the phone, putting them at risk of fake telemarketing calls. Victims’ contact information is typically shared between scammers, so the same people are often repeat victims.
- Prescription Drug Scam: Prescription drugs can be expensive, leading seniors to look for deals online. But if the medications are purchased from an illegitimate source, then not only will your health condition be left untreated, but the drug might also damage your health.
- Scams via the Internet: The selling of counterfeit prescription drugs is not the only scam online. Beware of pop-up browser windows encouraging you to download expensive (and fake) anti-virus programs and emails requesting you to update or verify your personal information with a seemingly legitimate company or institution.
- Fake Anti-Aging Products: With society’s ‘youth-obsessed’ nature, it can be tempting to use beauty products that conceal age, but the selling of fake treatments and medications, including fake Botox and other outlandish homeopathic remedies, have been on the rise.
- Lottery Scams: A red flag should immediately go up if you’re told that you’ve won a lottery or sweepstakes and that you need to pay a fee to get the prize. Seniors will be sent a fake check while the scammers pocket the prize’s fee.
- Dishonest Financial Advisers: Always monitor the money flow in your investment accounts as there are some financial advisers out there who are guilty of embezzlement and fraud. That’s not to say that honest and ethical financial advisers don’t exist, but if you’re dealing with professionals who advise you in your financial decisions, make sure to request bank statements and check them frequently.
- Funeral and Cemetery Plot Scams: Some funeral homes have also been known to be dishonest. Some will continuously pester you to buy the most expensive casket while others will add unnecessary costs to the total bill.
- Obituary Scam: Scammers read obituaries and call the deceased’s widow or family members in order to collect money for a supposed debt that the deceased left behind. Scammers might also come directly to your door with a delivery and demand immediate payment for an item they claim the deceased ordered before their death.
Here’s the rule of thumb when deciding if something is potentially a scam: if it’s too good to be true, it probably is. Click to learn more tips on how you can protect yourself from senior scams.