What if your young adult grandson called and told you he needed help and was so ashamed that he did not want his parents to know? What if he said his name, seemed to have personal information about you and then proceeded to tell you he was in trouble. He may say he was distraught over a friend’s death, got drunk, and hit another car causing a fatality and was now in jail and needed bail because he thinks he is badly injured and can’t get proper medical treatment unless he gets released. Because of the nature of the problem, he tells you he does not have access to his ID, etc. and needs a wire transfer. Then, later you get a call from your son’s public defender to make arrangements for you to send the money.
If you are like most grandmothers, you would just send the money. It is a crisis and most people in a crisis suspend doubts and suspicions. This is similar to what happened in Aspen, CO where a woman ended up giving a con artist, pretending to be her son, almost $7,500.
These scams and many like them happen all across the country every day.
Elderly people are number one targets for this type of scam because they care so much about their families and would do anything to help them. They are also a target because it is easier to "pretend to be a young family member" when you are talking to someone with some mild hearing impairment. And, many seniors have some kind of nest egg in the case of a crisis and often feel they want to use it to help their families. In fact, people over 50 hold 70% of the wealth in the US. So, like rats to the pantry, criminals stalk prey with money. In 2005 alone, over 80,000 cases of fraud directed toward seniors were reported and the number will likely be higher each year as our society ages.
Statistics on Financial Abuse of Seniors
Seniors increasingly report they have been duped by someone to hand over some of their hard earned savings. Many more do not report these crimes out of embarrassment. A study conducted by MetLife estimates that $2.6 billion a year is lost in the US due to financial fraud against seniors. The most typical victim, according to the same study, is female, white, between 70 and 89 years old, frail, trusting, lonely, and cognitively impaired. Again, the problem is expected to grow exponentially in coming years due to the large "baby boomer" population becoming seniors. While the problem is financial in nature, once scammed, a senior often has other long-lasting negative effects like depression, decline in health, loss of independence, and credit problems.
The main culprits? Sadly, 55% of those who scam seniors are close to the senior (a family member or caregiver).
Oftentimes, a bank employee, caregiver, or other family member will be the first to recognize a problem.
Loneliness of Seniors
Avoiding Isolation as a Caregiver
Scams by Strangers
- The Needy Relative: This is like the story above where a con artist will find out the name of a young relative and pretend to be that person in some sort of crisis. Sometimes the criminal will pose as a lawyer or doctor and explain that the senior's poor nephew is in trouble and needs bond money or money for an emergency surgery. They will ask the senior to not call anyone else in the family because it is a sensitive or confidential matter and urge the person to wire money.
- The Credit Card Company: This scam has been used many times and because seniors often trust that they will be treated fairly in the marketplace, they are particularly susceptible. A person will call and state a concern about the senior’s credit card – maybe the number appears to have been stolen and used online to buy something. He will then ask the senior to verify the number on the card by reading the number, codes, and expiration dates. At that point, the con artist has everything he needs to go shopping!
- The Windfall: In this scam, a caller will explain that a prize has been won, an inheritance came through, or some error in the person’s favor has occurred. To process the check, however, the con man will need the senior to send in some fee to cover the costs of transferring the prize. The transfer fee is paid, but the senior never collects the windfall. This type of scam often takes place in the mail through a letter as well.
- Trouble Scam: While many try to seduce money with offers or with sentimentalism, this type of scam uses fear. The con artist will pretend to be in some sort of official capacity - like a representative of the IRS - and tell the senior he or she has made some kind of illegal error to convince the elder to turn over money or personal and financial information.
- Insurance or Funeral Scam: Someone may come to the door and actually show the person official looking documents to prove ownership of a funeral, a burial plot or life insurance. The person is told to pay in cash or in money order so that they won’t have to explain it to their family members who may become upset by the idea of end-of-life planning. Of course, no such insurance, plot, or funeral service actually exist.
- In Person Theft: Sometimes, con artists will show up in a small group at the senior's residence pretending to be a home service like a lawn care or handyman service. When the senior tells them they are not needed, they will ask to use the person's phone or ask to come in and call their supervisor to understand the mix up. Meanwhile, one of the workers may ask to use the restroom or just sneak by to roam the house stealing jewels, cash, or credit cards.
Financial Abuse by Family Members
Financial abuse by family is, unfortunately, a common type of scam on seniors. It can range from mild to quite serious. These acts are often referred to as "trust crimes" because the basic tool of the thief is his status as a family member.
While some of these things are often done legitimately (like becoming a power of attorney or changing wills), these are examples of ways a person may be stealing from an elder relative for personal gain instead:
- “Borrowing” things without permission – like the car
- Outright theft of property – jewelry, cash, other items
- Forged Checks
- Through undue influence, coercion, trickery, or dishonesty, manipulate the elder to sign a form to:
- Make a new will
- Change names on bank accounts
- Change names on deeds
- Permit power of attorney
- Take over the thief’s loans, etc.
- Asking for help and large sums of money for illegitimate or false “needs” or getting a loan that never is intended to be repaid
- Making a deal and breaking it – like offering security, living arrangement, or caregiving in exchange for the deed to a home and then not making good on the deal.
This type of crime is difficult for family to address. First of all, the senior may defend the family member out of a sense of duty, shame, or some desire to maintain a relationship with the family thief. Second, even if dishonest family members are prosecuted, they often cannot repay the money (because they spent it) and the family does not feel a sense of relief or resolution since even the dishonest thief was also a family member. So, these stories often feel like "everyone loses." Family members most likely to commit this type of crime against an elderly relative are those with other problems like legal issues, drug and alcohol addictions, unemployment, gambling problems, or untreated mental illness. Sometimes, however, a person is simply greedy and sees a great opportunity to get "his inheritance" sooner or feels entitled to get more of the estate before it is divided up among a large family.
The "Recent Stranger" or "New Best Friend"
Someone looks at the obituaries and realizes that Mrs. Jones is suddenly alone. She is a good target. The “New Best Friend” makes his or her move. While a day ago this person was a stranger, in just a few months, this person can become so trusted that even the closest family member cannot rival the new bond. Sometimes, this relationship will be a romantic one, but often, the recent stranger becomes a new best friend, trusted advisor, caregiver, or counselor.
In time, their trust is so strong, that the recent stranger can easily pull off the same tactics as a family member seeking to siphon money away from the elder. Some of these cons are professionals – going in for the kill and leaving without a trace to befriend a new unsuspecting senior in another town. They are often quite skilled at manipulation and are often charming - disarming even skeptical family members (for a while).
In other cases, it is a crime of opportunity. While the con did not plan to prey on an elder, the situation may have simply presented as too tempting to pass up. In these cases, it may be a person who was not previously close to the elder - but someone who was somehow affiliated, like a distant relative of a deceased spouse.
Often, the type of scams are similar to those described for family members. But, the "new best friend" also is more likely to dream up an investment or business plan the pair can do together. Of course, the investment comes solely from the senior. This type of scam is also often accompanied by multiple lies when other family members start to suspect a problem or try to interfere. The charmer will at first try to keep everything looking "good," but when that fails, he will sometimes lie to the senior about concerned family members' motives and drive a wedge between the senior and the rest of the family. Isolating the victim makes them even more vulnerable to throw money into wild vacation plans, investments, and schemes.
Trust crimes are additionally harmful because the duped senior often feels like he or she was part of the scam or cooperated in some way. When considering calling on police, the senior will often have difficulty describing when the crime occurred since he signed the checks and unwittingly agreed to so much of the theft. So, victims often blame themselves for the situation and feel guilt on top of feelings of hurt, loneliness, and shame. This can further demoralize a person who may have already been isolated or vulnerable to begin with.
How to Spot Financial Abuse:
Here are some signs to look for patterns over time of a problem:
- Fishy explanations for big expenditures
- A senior's new secrecy about her finances
- Sudden change in will or other plans or property ownership
- A caregiver, power of attorney, or "new best friend" who doesn't use the senior's money getting things the senior needs - like adequate food, medicine, healthcare, or clothing.
- Suspicious signeratures on checks
- Unpaid bills
- Large withdrawals or "Gifts" or "loans"
- New investment schemes that seem to come from nowhere
- A family member or "new best friend" who seems to be driving a wedge between the senior and the rest of the family
Tips for Avoiding Financial Abuse and Scams
The above outlines common scams, but be aware that new scams happen every day. Here are some general tips to keep you or a family member safe. If you are a caregiver, you may want to talk to your family member about these ideas:
- Legitimate investments, purchases, and even legal or medical crises usually do not require or call for a person to keep the matter confidential from other family members.
- Real situations would never call for a need to use a money order or wire transfer rather than a standard check.
- Never give personal information over the phone such as your birth date, social security number, or credit card numbers. A credit card company that calls you would not need to ask for your credit card number over the phone.
- If someone comes to the house to sell you something, ask for them to come at another time when another family member can help read contracts and verify the legitimacy of the paperwork. If they come to the house for other reasons, don't ever let them in. Suggest they drive to a nearby business to make a phone call or use the restroom.
- If you or a loved one have trouble saying no, remember, you can always buy time by:
- asking to have time to think it over
- asking for the person to call back or come back when someone else can help you make decisions
- better yet, get their name and number and ask if you can call them back!
- If it sounds too good to be true, then it usually is!
- The most vulnerable seniors are those who live alone or who are having memory or other cognitive deterioration. If you have concerns about someone’s ability to handle their finances responsibly, you may want to pursue a durable power of attorney so that he or she cannot be victimized. If you are concerned about fraud coming in through the mail, make an effort to go through mail together.
- Other vulnerabilities should be addressed. If a senior is lonely, they need more companionship that is legitimate - like a day center for activities, assisted living situation or a move in with a caring family member.
- Do not co-mingle a senior's finances with a power of attorney or caregiver and work with one trusted bank or teller to make it easier to catch odd patterns of withdrawals and other suspicious activities.
- New relationships can be exciting, but few real relationships occur over night. Good relationships and real trust build over time. If you find yourself in a new relationship and have some doubts, trust your instincts and be slow to offer financial assistance to your new companion. Keep other family members close by - don't let yourself become isolated from your own family and tell at least one other person if you are giving large gifts or making large investments. You may have blind spots that others can see. It is natural to want to connect with others and to want to be generous. It is also hard at times to know when someone is not being honest or fair to you. So, getting some other perspectives or a second opinion on financial decisions can be helpful.
As stated above, many of these crimes go unreported because of embarrassment, but some are not reported because there is a fear that if it becomes known that something like this happened, maybe family members will question a person’s ability to manage money overall. These are sensitive topics and require a lot of care in handling. It is generally best if caregivers receive help from other family members in dealing with these issues. If you feel you have been scammed, contact your local police who can investigate and maybe even recover some of what was stolen. If you believe a person close to you is exploiting you for money, talk with someone else to explain what is happening. There is no shame in being vulnerable to love or friendship or family and wanting to be generous. But, you owe it to yourself to make sure you are being treated fairly. Talk to clergy, a trusted friend, a family member, or even call for a counselor.
To Report Abuse:
Contact your local Adult Protective Services. You can find your nearest center here.
Legal and Financial Matters
Avoiding Conflict with Money