Financial exploitation of seniors is one of the fastest-growing forms of elder abuse in the nation, with the number of reported cases more than doubling in the past five years. Ryan Malone, Regional Director for Travelers Investigative Services, answers important questions about this growing trend and how seniors and their loved ones can help defend themselves against elder financial fraud.
What is Elder Financial Fraud?
Elder financial exploitation or fraud is the illegal or improper use of a senior’s funds, property or assets. The fraudster can be an unknown party or a family member or trusted friend.
Why is Elder Financial Fraud on the Rise?
Fraudsters go where the money is, and Americans over the age of 50 generally control 70% of the nation’s wealth. That, coupled with vulnerabilities that come with age – isolation, loneliness, fear, declining cognitive ability – makes some seniors easy targets for scammers.
What Are the Different Types of Elder Financial Abuse?
Elder financial abuse can take many forms, but it always comes down to separating a person from their money or valuables or getting personal information that will make it easy to empty a bank account or run up credit card bills.
Is There One Good Way Seniors Can Protect Themselves?
Perhaps the single best thing a senior – or anyone – can do to help protect themselves from financial fraud is just to pause and think. Many scammers put pressure on you to make an emotional, fast response. Before you reply to an email, answer a question or a phone call about a special offer, stop, think about the information you are asked to share and research the entity or discuss the contact with a trusted advisor.
Elder Financial Fraud Can Often Start with Identity Fraud, Right?
That’s right. We all need to remember that our personal information is currency to fraudsters. Getting a Social Security number, birth date, address, insurance plan number or other personal information allows a scammer to take on your identity, open new credit card accounts, make purchases, file phony insurance claims, steal your tax refund or access your bank accounts.
If a Senior is Rarely Online, Are They Still at Risk?
Yes, identity theft and financial fraud happen both online and offline.
How Can a Senior Who Goes Online Stay Safe?
Passwords are a first-line defense to everything we have online – our banking and payment information and personal identification. Good password practices are a smart and easy way seniors can be safer online. For example:
- Choose passwords that include letters, numbers and characters.
- Use different passwords for different accounts and change passwords regularly.
- Never participate in online quizzes or games that ask you to reminisce about your first job, first car or other innocent-sounding topics. You could be giving away personal information that a fraudster could use to impersonate you and get access to your financial accounts.
How Can Technology Updates Prevent Fraud?
Whether it’s a computer, a phone or a smart-home device, technology updates for your devices and equipment often include critical security patches that help eliminate vulnerabilities. Be sure to keep your electronic equipment updated.
But Software Update Emails Could Be Scams Too, Right?
Yes, and the best way to avoid installing a fake software update is this: When you get an email about an update, DO NOT click on the link. Instead, go to the software company’s official website. You can safely download the update from there.
How Can a Senior Stay Safe Offline?
Just like in the online world, you want to make it as difficult as possible for someone to access your personal identity information. Take these steps to help protect your identity and finances:
- Just because a form asks for certain information (like your birth date, bank account numbers, driver’s license number or Social Security number) doesn’t mean you must provide it. Ask why that information is necessary.
- Shred all paper with identifiable information before throwing it away. That includes credit card solicitations, anything with your address and name, sales receipts, old medical bills and bank statements.
- Lock your car. You have plenty of personal information in paper format in your vehicle, like your car insurance information, car registration, receipts and other documents an identity thief would love to have.
Are Fraudsters Usually Strangers?
In many cases, strangers are responsible for the financial exploitation of seniors. But data show that over a third of the time, exploitation happens by acquaintances and even family members. For the most part, people are good. But some people want to benefit from their personal connections to seniors.
How Can Seniors Protect Themselves from Financial Fraud?
First, realize that those closest to you – family members, caregivers or home helpers – have the greatest opportunity to take advantage. Then, take away the opportunity.
- When people come to visit, make sure personal papers, wallets and bank information are out of sight and in a secure location.
- Review your financial statements regularly and question any charges or withdrawals you did not make.
- Consider having two unrelated gatekeepers who you can trust to help review your financial statements, bill paying and tax documents.
- If you assign power of attorney, consider two people who will have to work together.
What Should a Senior Do If They Suspect a Fraud?
Many people are embarrassed or afraid to ask for help when they realize they are victims of a scam. But reporting fraud to the proper authorities is important for many reasons. First, the faster fraud is reported, the more likely it is that the exploitation will stop and what was lost can be recovered. Also, reporting the scam can help fight fraud and protect others.
How Should Fraud Be Reported?
Here are the simple steps to take to report elder financial fraud:
- Talk to a trusted family member or financial advisor about the experience. You can also call the National Elder Fraud hotline 833-FRAUD-11 (833-372-8311), which provides services to seniors who may be victims of financial fraud.
- Contact your credit card company or financial institution if your account has been compromised.
- Call your local police department (not 911) if your loss is significant.
- Call your insurance provider to report any money or property loss. They can help you navigate the loss and give you the information you need to make an informed decision about whether to file an insurance claim.
About the Elder Fraud Expert
Ryan Malone is a Regional Director for Travelers Investigative Services, the Special Investigations Unit for Travelers. He has investigated various insurance claim frauds and has helped develop digital investigative tools to complement traditional investigative strategies.
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