May 16, 2016
Elderly citizens lose billions a year to scams targeting seniors.
Seniors are victims more often than other age groups.
Seniors are victims more often than persons from other age groups. This is because they may have accumulated more savings over time, and are experiencing increased dependency on others because of diminishing physical and mental capacity.
Financial scams targeting seniors are common. One survey found that almost 20 percent of those 65 and older have been the victim of a financial swindle. And that is only of those who know they were victimized. Many seniors never realize – or at least never admit – that they were scammed.
Fortunately, seniors and their children can take steps to reduce the likelihood of being victimized.
The first step is to recognize the signs that someone may be a target of financial abuse by a stranger, a family member, or a caregiver. Those signs include:
They get mail, email or phone calls announcing that they have won a sweepstakes or a “prize.”
They are suddenly “befriended” by a new person who wants to spend a lot of time with them.
They are paying large sums for minor repairs or improvements.
They are asked to take their retirement savings and “invest” in or lend to a new business that established investors or lenders have declined to support.
At the advice of their financial advisor, they are frequently selling and buying stocks and bonds (“churning”).
They have left their long-time investment advisor and are excited about the big returns promised by a new advisor.
They are investing in “alternative investments” that they don’t really understand.
They are considering buying or have bought a deferred, variable annuity or an exotic insurance product.
They talk about the need to get a better rate of return on their investments and look online for high-paying investment opportunities.
They are spending less money, don’t want to take their traditional winter getaway, and are reluctant to discuss finances. This could indicate that they may have lost a lot of money.
What should you do if you think you or a loved one has been the victim of a financial scam?
Seek out a person or institution that you trust – such as your accountant, attorney, or trusted financial advisor – about who to contact to investigate what happened to the senior’s funds and assets. Don’t delay, the longer you wait to do something the less likely you will be able to recover your money.
The office of the Pennsylvania Attorney General operates a free Elder Abuse Helpline at 1-866-623-2137. It can also be reached by email to . [email protected]
If you think your parents are at risk of being financially victimized, talk to them. Ask to see paperwork associated with the possible scam or abuse. Look over their mail for “prize alerts” or questionable charitable requests for money. Review their documents, receipts and financial statements to determine whether they are receiving the services and returns that they paid for.
Be alert for possible signs of dementia – even a modest decline in memory and judgment can make an individual susceptible to being victimized. Financial abusers target persons with diminished capacity.
Don’t be put off if your parents seem reluctant to discuss your concerns. Victims of financial abuse are often embarrassed to talk about it, or they may be unaware that they have been victimized. Get their permission to talk with their financial advisor or their accountant. If you suspect that your parent or loved one has been the victim of financial abuse, contact an attorney for advice.
Don’t just sit back and accept the painful loss of savings and security from scams targeting seniors. Take action.
Larry Frolik is a Distinguished Faculty Scholar and Professor of Law at the University of Pittsburgh School of Law. A nationally known expert on the legal issues of the elderly, he currently serves on the Pennsylvania Supreme Court’s Advisory Council on Elder Justice in the Courts.