MSB Blog

It is an unfortunate reality, but senior citizens in particular are at a higher risk of falling victim to scams and fraud. In a report from the United States Securities and Exchange Commission, it was estimated that around 5 million senior citizens fall victim to fraud, scams, and/or financial exploitation every year.

Criminals are more likely to prey on seniors for many reasons. Older citizens can often be isolated, have more time of their hands, and therefore can be more trusting and welcoming of conversation. They also tend to have more difficulty recalling details, may have health ailments they would be happy to cure, and have more saved money than younger people. This makes them perfect targets for scammers.

Being aware is the first step we can take to help protect seniors from falling victim to scam artists. While there are many scams out there, Monson Savings Bank is hoping to bring awareness to financial scams that commonly target seniors in an effort to prevent elderly exploitation.

Tech Support or Fake Virus Scams

A tech support scam involves an individual pretending to be a support specialist convincing the victim they have a virus or issue with their computer that truly does not exist. After being allowed to get remote access to the computer to “fix” it, the scammers actually obtains that person’s sensitive information which can be used to even further exploit the victim. Due to fast advancing technology, seniors fall prey to this scam because of their unfamiliarity with technology.

Grandparent Scams

A grandparent scam is when an imposter acts as if they are the grandparent's loved one, usually a grandchild. The scammer, acting as the grandchild, will be in distress, and possibly cry to disguise their voice. They will claim to be in big trouble, beg the grandparent not to contact anyone, and to please send money, fast! Due to the love for that family member and the urgency, many seniors fall victim to this horrible scam.

Charitable Gift Annuities

Charitable annuities are a special type of investment. In a charitable gift annuity, a donor would donate a large amount of money to a charity, and in return, the charity gives the donor a flow of income for the remainder of their life. Unfortunately, many elderly victims are being tricked into putting money into bogus charitable annuities. When this happens, there is not an actual charity, the donation money is going into a scammer’s account.

“Risk-Free” and “High-Return” Investments

If an investment is supposed to have little or no risk and a high return, it is most likely a scam. Seniors are typically more risk-averse than other investors, so they are more likely to be duped into falling into this type of financial scam.

Medicare Fraud

Medicare fraud happens when a claimant illegally seeks a higher payout than they are owed from Medicare. This type of fraud can be executed by medical professionals, healthcare facilities, patients, or anyone who impersonates one of those parties. Popular examples of Medicare scams include conducting unnecessary medical testing, charging for medical services that were not provided, and accepting Medicare benefits although one is not eligible to. You can protect yourself from Medicare fraud by recording all of your medical appointments and tests on a calendar, safeguarding your Medicare and Social Security numbers, and staying up to date on recent cases of Medicare fraud.  

Fake Certificates of Deposit and Bonds

Certificates of deposit (CDs) and bonds are appealing investments for seniors because they carry a very low-risk. Scammers can take advantage of this by selling CDs and bonds to seniors that either do not yield what they promise to or do not even exist. Always make sure you are working with a well-known and trusted financial advisor before investing.

Illegitimate Promissory Notes

A legitimate promissory note is a debt investment where an investor lends money to an entity for a certain amount of time with an agreement of getting paid back at the end of that period with interest. Often times, when a promissory note is given to a single investor it turns out to be fake. Seniors who are seeking a guaranteed return on their investment can unfortunately fall victim to lending money to an entity that does not exist and losing their hard earned money to a scammer.

Romance Scams

Many seniors can be isolated and wish to have companions to share their time with. Unfortunately, this makes them easy prey for romance scams. These are when a scammer poses as a romantic partner, usually on a dating website or social media, and then builds a “relationship” with the person. They will request money for emergencies, or plane tickets to visit, and then ghost the person once they have their money. Sometimes, they will string along the victim for a longer period of time, draining the victim’s savings account before they realize it is a scam.

Red Flags of Common Scams

• You are being rushed or pressured to release information or act fast.
• You are asked to provide personal information by phone, email or text.
• You are asked to keep the transaction a secret.
• You won something but there are strings attached, like sending money for shipping or taxes.
• You are being asked to send money via wire.
• You are asked to send money upfront before you receive a prize.
• You receive a payment in the form of a cashier’s check or money order.
• You are asked to pay in gift cards.
• They do not want you to hang up and call back.
• You cannot find their company or name on the internet.
• They make excuses to not speak on the phone or meet in person.
• It sounds too good to be true.

How to Report

Monson Savings Bank reminds the public to be vigilant about these types of scams and report them.

To Report Fraud go to the Federal Trade Commission at reportfraud.ftc.gov/ to submit a report or call the FTC's Consumer Response Center at 877-382-4357.

How loved ones can help protect seniors?

Check in with your senior relatives and friends. Talk to them about what they have been doing lately and who they have been speaking with. Tell them about common scams you have heard going around so they know about them. It is important to have regular conversations about finances so you can be alerted of any suspicious activity they may have encountered.

Summary

Scammers will use many tactics to financially exploit senior citizens. It is important to watch for warning signs of a scam and to not make quick decisions. Don’t be afraid to say “no” and don’t let yourself be rushed or pressured. Always reach out to a friend, family member, or trusted advisor for advice before taking actions. Do your research, and if you are in doubt at all, do not share any information.