Protect the Elderly from Financial Scams and Abuse

Nancy is a retired professor and widow living in her home alone. While still active, her hearing is declining as are her cognitive skills. When the caller said she was a former colleague in a financial bind, Nancy assumed she simply didn’t remember the person or hear the name correctly, but agreed to mail the requested check to the “friend” anyway. Though it seemed an odd request, she even included her Social Security number on the reference line. It was not until weeks later when her daughter discovered that Nancy’s accounts had been hacked, her identity stolen, and thousands of dollars fraudulently withdrawn.

Sadly, Nancy is far from the only elderly person to become a target of scams and financial abuse. According to Consumer Affairs, every year more than 3.5 million older adults are the victims of financial exploitation. Those frauds on average add up to $34,200 per person.

Financial fraud and abuse of the elderly comes in many forms, including these common tactics.

Fake Check Scams
Fake check scams have been around awhile but they still trick many, especially older adults who may be more trusting. In a common fake check scam, the criminal sends an official-looking check and then claims it was a mistaken overpayment and requests a wire refund. Because financial institutions are federally required to deposit certain check funds within days, the check’s funds will appear in the bank account right away. It could be days after wiring the requested “overpayment” that the bank realizes the deposited check was fake.

If ever in doubt about a check’s legitimacy, ask UFCU for advice. And never accept overpayment for a bill, or agree to send money back.

Medicare Fraud
Seniors are especially vulnerable to phone and online attempts to fraudulently access personal information under the guise of Medicare. A caller may claim to be a Medicare employee calling to verify Social Security and other information needed to pay a recent claim. Another strategy is a call or email offering the senior upgraded or new benefits by responding with personal information like birthdate or Social Security number.

According to Medicare.gov, Medicare will never call you to sell anything, never visit you at home, and cannot enroll you in Medicare over the phone without you first requesting the call. So, bottom line, unless you have requested contact and can definitively verify the individual’s authenticity, never respond to so-called Medicare requests for your personal information.

Investment Abuse
Investment abuse is the fifth costliest type of scams targeting those over age 60, accounting for more than $25 million in lost dollars in 2019, says Consumer Affairs. That is perhaps not surprising since maximizing investments is an important part of a financially secure retirement.

Things to look for include unsolicited calls and emails from an unknown salesperson or unfamiliar company. Also be wary of claims of unusually high returns or guaranteed returns, and urgent, must-act-now pushiness. If in doubt about the legitimacy of an offer, run it by a trusted UFCU financial advisor.

Related to investment scams are requests for donations to fake charities. Before investing in any charity, always do your own research. Review the organization’s website and online reviews. Check charity databases like Charity Navigator. And as with other financial investments, ask a trusted friend or financial industry expert like UFCU’s investment advisors for input.

Financial Neglect and Exploitation
Seniors’ financial assets can be the target of fraudsters in other ways beyond the phone and internet. Financial neglect and exploitation can encompass everything from bills being ignored and not paid, to mismanaging or spending an older person’s assets without consent or by manipulation. The fraud can come at the hands of a family member, personal caregiver, even a health care provider overcharging or falsifying claims. The National Center on Elder Abuse recommends that you beware of these red flags:

• Sudden changes in bank accounts, such as adding new names onto accounts and cards.
• Unpaid bills, letters from collection agencies, or past due notices from creditors even if the person has adequate financial resources.
• Previously uninvolved relatives showing up and claiming their rights to an elder’s property or possessions.
• The sudden transfer of assets to someone outside the family.

How to Protect Against Elderly Financial Fraud
Criminals continually seek new ways to do their work, making it important to vigilantly stay aware of financial accounts and continually take steps to protect them.

1. Reduce the opportunity for scammers’ calls by registering your phone number with the Do Not Call Registry, www.donotcall.gov.

2. Always shred any documents with personal information before recycling them. That includes credit card receipts, bank documents, tax statements, and investment records.

3. Never give financial account information, Social Security number, or online passwords to anyone.

4. Sign up for mobile banking alerts and online credit card account statements to stay aware of anyone accessing your loved ones’ accounts. If an unauthorized transaction appears, notify the organization immediately.

5. Run background checks before hiring in-home care providers.

6. Set withdrawal limits for your loved ones’ bank accounts, so that they retain freedom

7. Contact the National Elder Fraud Hotline at (822) 372-8311 if you or a loved one are a victim of financial fraud. A case manager there will help you navigate through next steps.

Consult Our Financial Experts

At UFCU, we are here to empower our Members to achieve their financial dreams from early adulthood through retirement years. Give us a call, or stop by your local financial center anytime to chat with a Personal Financial Representative and learn more.