{"id":10234,"date":"2019-06-01T00:00:00","date_gmt":"2019-06-01T05:00:00","guid":{"rendered":"https:\/\/www.lifeline.philips.com\/resources\/blog\/2018\/06\/financial-frauds-how-to-reduce-seniors-rip-off-risk.html"},"modified":"2023-08-10T15:43:13","modified_gmt":"2023-08-10T20:43:13","slug":"financial-frauds-how-to-reduce-seniors-rip-off-risk","status":"publish","type":"post","link":"https:\/\/www.lifeline.com\/blog\/financial-frauds-how-to-reduce-seniors-rip-off-risk\/","title":{"rendered":"Financial Frauds: How to Reduce Seniors\u2019 Rip-Off Risk"},"content":{"rendered":"<p>Even the most conservative estimates place losses from elder financial exploitation at <a href=\"https:\/\/www.truelinkfinancial.com\/research\" target=\"_blank\" rel=\"noopener\">$36 billion each year<\/a>. And that\u2019s just what\u2019s reported to financial companies and the police.<\/p>\n<p>\u201cElder financial abuse is happening in America at an alarming rate \u2013 if it was reported as often as it happens,\u201d asserts Syracuse-based <a href=\"http:\/\/boscllc.com\/\" target=\"_blank\" rel=\"noopener\">CPA and financial planner Ted Sarenski<\/a>.<\/p>\n<h2>Why does elder fraud happen?<\/h2>\n<p>There several reasons seniors are particularly vulnerable to financial frauds, chief among them:<\/p>\n<h4>Assets<\/h4>\n<p>\u201cWe have largest and wealthiest population of seniors ever as the Boomers age into the senior population,\u201d explains Chicago area author Glynnis Walker, whose own mother was an elder fraud victim. \u201cElderly women are particularly vulnerable because they often outlive their husbands and end up with funds from investments, real estate and life insurance and they are lonely.\u201d<\/p>\n<h4>Loneliness<\/h4>\n<p>A <a href=\"https:\/\/www.ucsf.edu\/news\/2012\/06\/12184\/loneliness-linked-serious-health-problems-and-death-among-elderly\" target=\"_blank\" rel=\"noopener\">landmark study<\/a> from the University of California, San Francisco found that more than 43% of seniors regularly felt lonely. And loneliness has been shown to <a href=\"https:\/\/hbr.org\/cover-story\/2017\/09\/work-and-the-loneliness-epidemic\" target=\"_blank\" rel=\"noopener\">impair \u201cexecutive functions\u201d<\/a> like reasoning and decision-making, which have a huge impact on our ability make smart choices and identify fraudulent and exploitative tactics.<\/p>\n<h4>Trust<\/h4>\n<p>\u201cTrust increases as people age, especially if they are getting attention from someone after being lonely for a long time,\u201d Sarenski says. We\u2019re more likely to trust people we shouldn\u2019t, avoid asking important questions, and ignore suspicious activities. We also put more trust in people we think we \u201cshould\u201d trust \u2013 like lawyers, financial advisors, neighbors and family members \u2013 and unknown scammers.<\/p>\n<p>This perfect storm makes older adults lucrative and easy marks for scheming opportunists.<\/p>\n<h2>How does elder financial abuse work?<\/h2>\n<p>People who want our money have lots of ways to get it.<\/p>\n<p>According to the <a href=\"https:\/\/www.acfe.com\/fraud-resources\" target=\"_blank\" rel=\"noopener\">American Council of Fraud Examiners<\/a>, scammers most frequently rip off seniors via phone calls, followed by email.<\/p>\n<p>These scammers call or email from an official-sounding organization alerting seniors to an urgent matter \u2013 often related to funeral insurance, medical expenses, Medicare or prescription drugs \u2013 that requires a payment of some kind. They ask for a wire transfer or credit card number to resolve the issue immediately. Good scammers sound authoritative and their requests are just plausible enough to be possible, which makes them unusually successful at tricking.<\/p>\n<p>But it\u2019s not just faceless strangers.<\/p>\n<p>\u201cThe majority of elder abuse comes from a relative of the victim,\u201d Sarenski points out. \u201cIt appears a family member is helping out when they are really taking advantage of their elderly relative. Non-relative abusers are often caregivers or neighbors who, again, appear to be helping.\u201d<\/p>\n<p>Walker\u2019s mother, who had Alzheimer\u2019s, was exploited people she knew, including neighbors and an attorney. They convinced her to rewrite her will and cut her daughter out of her life. You can read the whole story in <a href=\"https:\/\/www.amazon.com\/dp\/B016APSUX2\/ref=dp-kindle-redirect?_encoding=UTF8&amp;btkr=1\" target=\"_blank\" rel=\"noopener\">Stealing Joy: A True Story of Alzheimer&#8217;s, Elder Abuse, and Fraud<\/a><i>.<\/i><\/p>\n<h2>How can I avoid being a victim of elder fraud?<\/h2>\n<p>While wily criminals are always finding new ways to hide their malicious activities, there are a lot of ways to make it harder for them. Undertake as many of these senior fraud protections as possible:<\/p>\n<h4>Safeguard assets<\/h4>\n<p>Safeguard assets by creating different levels of security for different accounts. \u201cPut most of the liquid assets in one account,\u201d Walker advises, and \u201cmake sure their are two signatories. I should never should have put my mother&#8217;s name alone. It made her a target.\u201d Having a second name on the account can be a deterrent to criminals, who realize someone else is getting the statements and has to approve large payments.<\/p>\n<h4>Set controls and alerts<\/h4>\n<p>Set controls and alerts to stay on top of financial accounts, Sarenski suggests. Establish a maximum for cash withdrawals so anything over that is denied. Set similar limits for check and credit card transactions, and request notification when transactions exceed those. <b>Bonus tip:<\/b> Sign up for mobile, phone or email fraud alerts. Banks are great at flagging repeated payments to the same vendor, subtle patterns in spending and other potentially malicious accounts.<\/p>\n<h4>Monitor accounts<\/h4>\n<p>Monitor accounts each month to spot unusual transactions and identify suspicious patterns. \u00a0Online and mobile banking is extremely helpful, especially for parents and children who live far apart. If your parent has cognitive issues, Walker advocates getting copies of all credit card statements, bank account statements bills sent to you so you can monitor activity. <b>Bonus tip:<\/b> Keep account numbers safe from wandering eyes by blacking out all but the last four digits on paper statements.<\/p>\n<h4>Perform background checks<\/h4>\n<p>Perform background checks and thorough investigations of anyone who is going to provide any type of care or housework for their elderly parent, Sarenski says. The same goes for attorneys, accountants and other professionals. Even if you can\u2019t afford a formal check, look at online reviews, contact the Better Business Bureau and ask around your community.<\/p>\n<h4>Pay attention to scams alerts<\/h4>\n<p>Pay attention to scams alerts from local law enforcement, government and senior service agencies. And make sure your parents and children know about them, too. <b>Bonus tip:<\/b> The FTC keeps a <a href=\"https:\/\/www.consumer.ftc.gov\/scam-alerts\" target=\"_blank\" rel=\"noopener\">running list of scams<\/a> on its website. Familiarize yourself with tactics so you\u2019re better able to avoid falling prey to them.<\/p>\n<h4>Don\u2019t give out your account numbers<\/h4>\n<p>Don\u2019t give out your account numbers on the phone or via email or text to anyone you aren\u2019t sure about. If you get a call or an email requesting this information, call your local police station or sheriff\u2019s office. They can tell you if this is part of a known scam.<\/p>\n<h4>Report suspected elder fraud<\/h4>\n<p>Report suspected elder fraud to the bank, financial institution or credit card company as soon as you spot it. Representatives will help you protect your account from further charges and suggest next steps. You may also contact law enforcement, who can tell you what information is needed to bring charges. \u201cSeniors often don&#8217;t report the crimes because they are embarrassed or because they don&#8217;t want to lose their control over their lives,\u201d Walker laments. But reporting is an important step to getting your funds restored.<\/p>\n<h4>Get involved<\/h4>\n<p>Though challenging, it\u2019s critical for adult family members step in as soon as elder fraud or exploitation is detected. \u201cLook for proof that you could bring to authorities,\u201d Sarenski says. \u201cThe senior [may] not be the person to rely on to tell you of the elder financial abuse for two reasons:\u00a0they are embarrassed that they have been taken advantage of [or] they feel physically and mentally incapable of affecting change.\u201d<\/p>\n<p>Put these senior fraud protections in place address the causes of elder financial abuse and mitigate your or your parent\u2019s risk of being taken advantage of.<\/p>\n<p><i>This information is not intended as a substitute for professional financial, accounting, tax or legal consultation; it is provided \u201cas is\u201d without any representations or warranties, express or implied.\u00a0Always consult professionals when you have specific questions about any financial matter.<\/i><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Even the most conservative estimates place losses from elder financial exploitation at $36 billion each year. And that\u2019s just what\u2019s reported to financial companies and the police. \u201cElder financial abuse is happening in America at an alarming rate \u2013 if it was reported as often as it happens,\u201d asserts Syracuse-based CPA and financial planner Ted<a class=\"read-more\" href=\"https:\/\/www.lifeline.com\/blog\/financial-frauds-how-to-reduce-seniors-rip-off-risk\/\"> Read more >><\/a><\/p>\n","protected":false},"author":3,"featured_media":29861,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","footnotes":""},"categories":[27],"tags":[],"class_list":["post-10234","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-smart-spending"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.9 (Yoast SEO v26.7) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Financial Frauds: How to Reduce Seniors\u2019 Rip-Off Risk | Lifeline<\/title>\n<meta name=\"description\" content=\"Annual losses from elder financial abuse are at least $36 billion. Our experts explain how to reduce the risk of being defrauded\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.lifeline.com\/blog\/financial-frauds-how-to-reduce-seniors-rip-off-risk\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Financial Frauds: How to Reduce Seniors\u2019 Rip-Off Risk\" \/>\n<meta property=\"og:description\" content=\"Annual losses from elder financial abuse are at least $36 billion. 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