For every dollar taken from a person over age 65, there is an altered life, perhaps one with less independence and confidence than before.
“My Mom lost $4,800 last year to a scammer,” said Ayesha Prakash. “It’s been really hard. It’s not just the money loss, though nearly $5,000 was a lot to lose, but she is feeling so helpless and stupid at the same time.”
The speed with which the scammers worked to extract the money from Mrs. Prakash’s 63-year old mother is as alarming as the crime itself. Mrs. Prakash’s mother lives with her 89-year old mother and Mrs. Prakash’s father passed away three years ago. The scammer called and kept her on the phone for about four hours, and although her adult children were calling, she did not answer their calls as she left the house to wire the money and stayed on her cell phone with the thieves.
“They told her that her husband had owed the IRS like $4,000 and that if she told anyone she would go to jail,” Mrs. Prakash explained. “Although my Mom is a U.S. citizen, she comes from India and in India if you owe someone money then it’s bad for your name. She was scared.”
Her mother went to a money wiring location and, as instructed, sent the money in split payments to specific names and the thieves had it instantly before any of the family knew.
Scamming the Elderly is Big Business
That $5,000 is just a drop in the bucket of the estimated $2.9 billion financial loss from victims of elder financial abuse annually, according to a 2011 MetLife study. Fraud may be perpetrated by strangers (51% of the time) or someone close to the victim (34% of cases) and women are nearly twice as likely to be victims and men are more likely to be the perpetrators, the study found.
There are many insidious methods used by fraudsters to pry money from people’s personal accounts: they may pretend to be the IRS and reach them through email or by phone only, they may pretend to be a family member, they may pretend to be a lonely heart who they connect with only by email and phone, they may pretend that someone won a prize and just needs to provide their credit card number or social security number to claim it, and many, many other ways.
Sadly, these people are often preying on loneliness. Elder law attorney William J. Brisk, explains that even people who buy something from a TV commercial can be persuaded to keep spending thanks to a simple phone call. He explained, “They might call and say, ‘Are those slippers as comfortable as they said they are?’ This might be the most personable contact they have had in a week!”
Scamproof Your Loved Ones
How does one talk to their elderly aunt or frail father about the fact that they could be taken advantage of without hurting their feelings?
Mr. Brisk, first recommends developing an awareness as to who is most at risk to be targeted and suckered into a scam. “Be concerned about people who are homebound, who don’t have an active social life, who might be hoarders,” he said.
Unfortunately, even if someone thinks they have been scammed, they don’t want to admit it to anyone. “They think they might be put under some supervision and have their freedom taken away,” he said. “You have to be very careful about how you broach the subject.”
First, he recommends someone trustworthy who can overlook finances periodically. Second, share a story about someone you know or read about who was scammed and explain facts like how the IRS never calls or emails people. Click here to read the IRS warning on tax scams to taxpayers.
If you or a your loved one does get scammed out of some money, Mr. Brisk suggest contacting your state attorney general’s office to find out what their protection against scams is. “Here in Massachusetts, they have been able to recoup stolen money from scammers,” he said.
Prevention—through open conversation, planning, and research—can go a long way to protecting your family from a financial scam.