Last week four individuals were arrested in the Greater Philadelphia area for allegedly taking at least $162,600 from 11 senior citizens in eight states. They were running a scam called the "Grandparent scam," where they contacted seniors and told them a grandchild was in trouble and needed them to send money.
There's a lot of variants on this scam. I got an e-mail once from a former student whom I hadn't talked to in over a decade. The email said he was traveling in a foreign country, lost his passport and needed money to pay for legal fees to get out of the country. I didn't take the bait.
How to protect yourself
The FBI says that its Internet Crime Complaint Center, or IC3, has received reports about this type of scam since 2008. Its advice to avoid becoming a victim to the Grandparent scam:
• Resist the pressure to act quickly.
• Try to contact your grandchild or another family member to determine whether or not the call is legitimate.
• Never wire money based on a request made over the phone or in an e-mail...especially overseas. Wiring money is like giving cash -- once you send it, you can't get it back.
The Financial Fraud Enforcement Task Force's website, stopfraud.gov, defines Elder Fraud and Financial Exploitation as "an act targeting older adults in which attempts are made to deceive with promises of goods, services or financial benefits that do not exist, were never intended to be provided or were misrepresented. Financial exploitation is the illegal or improper use of an older adult's funds or property."
The National Council on Aging, or NCOA, features the article 22 Tips for avoiding scams and swindles. It lists four major categories of fraud: health insurance fraud, Medicare scams, telemarketing scams and home repair or contractor fraud. The NCOA explains that scammers target seniors because of seniors' fears, frailties, their dependence on others and isolation.
The NCOA says that likely perpetrators are:
• Strangers preying on older people who may be isolated, lonely, confused or desperate for attention.
• Family members to whom the person wants to stay connected.
• Caregivers (family and other) who use fear or guilt to take advantage of a senior.
What's a senior to do? Learning about the potential scams you'll see and the potential for financial exploitation is important. On the scam side, I'm a new fan of OnGuardOnline.gov as a way to learn about online dangers and how to avoid scams. Financial exploitation by strangers, family members and caregivers is a little more complicated, but keeping track of your finances, keeping them secure and being cautious in financial dealings can go a long way toward keeping your money available to you.
Read about 6 scams aimed at the elderly.
Have you ever fallen victim to a scam or financial exploitation? How do you protect yourself against these threats to your financial well being?
Follow me on Twitter @drdonsays.