How to Protect Your Parents From Elder Financial Abuse
November 14, 2016 | Home and Family
Evelyn, 60, was at home one afternoon several months ago when she got a phone call. The person on the other end of the line told her that he worked with Microsoft and that her computer had been hacked. If she gave him remote access to it, he said, he would be able to fix it.
Evelyn (who asked to be interviewed under a pseudonym) was skeptical, but she followed his prompts, gave him remote access and paid him $150. A few minutes later, he insisted she pay him another $150 because the problem was more difficult than he had anticipated. When he asked for $500 more, she realized she was being conned and hung up the phone. Having given the man her credit card number, she thinks she was lucky that she was charged only $300. But she felt ashamed of being taken in so easily and kept the incident secret from her friends and family.
According to the National Crime Prevention Council, scammers target seniors aged 60 and over far more frequently than they do any other group. In a recent study, it found that seniors were the targets of 49 percent of telemarketing scams involving medical care and 46 percent involving investments. That adds up. True Link Financial’s 2015 Report on Elder Financial Abuse found that seniors lose $12.8 billion annually to scammers or identity thieves.
If you’re a senior or you have senior family members, you might have encountered or even fallen for elder financial abuse like the scam Evelyn experienced. But there are ways to stay safe.
1. Know your enemy. Amy E. Nofziger, director of regional operations with the AARP Foundation and an expert with the AARP Fraud Watch Network, said her organization has been hearing a lot about calls like Evelyn’s.
“They instruct you on how to get the virus off your computer,” Nofziger said, “but what it does is give them access to hold your computer ransom until you pay.”
To avoid being taken in, it’s important to know about popular cons. Nofziger said seniors and their caregivers should “build up their arsenal against fraud by learning the common scams that are happening and the persuasion tactics that scammers use.” To help inform seniors, the AARP maintains an online database where you can learn about frauds reported in your area.
One common scam the AARP hears about frequently is fraudsters posing as Internal Revenue Service agents.
“Someone calls you and impersonates the IRS,” Nofziger said, “demanding you pay them money to avoid being taken to jail for not paying your taxes.” According to the IRS, the organization would never call someone without first sending a written assessment by mail.
Nora Dowd Eisenhower, assistant director of the Office for Older Americans at the Consumer Financial Protection Bureau, said they also hear a lot about fake contractors who ask for payment up front and then disappear. To avoid being defrauded by contractors, be skeptical of people who approach you directly. Instead, find a reputable company through a recommendation or the Better Business Bureau.
2. Know if you’re vulnerable. While seniors generally are common targets for criminals, some are especially vulnerable. Nofziger cited health issues and medication changes as two factors that can affect the cognitive and emotional states of seniors and make them more susceptible.
Eisenhower said seniors are more at risk of being deceived in the first year after the death of a spouse because it’s sometimes the first time they’re in charge of their own finances. She also noted dementia as a factor and recommended that affected individuals and their families create a plan to guard against fraud. That could include creating a financial power of attorney who oversees all financial transactions, or giving any financial professionals the senior is dealing with the phone numbers of family or friends to call if they suspect wrongdoing. If a power of attorney is in place, seniors can simply tell all solicitors to contact that person instead.
Like many seniors, Evelyn said what made her vulnerable was her lack of knowledge about computers. Because she knows she’s more susceptible than others to being conned in this area, Evelyn now asks a family friend to fix any computer problems.
3. Know how to protect yourself. Seniors should refuse to provide personal information to anyone who calls them unsolicited or contacts them online, Nofziger said. While hanging up the phone is the best option, some seniors feel uncomfortable doing so. In that case, Nofziger suggests practicing “a refusal script by role-playing how you would handle situations where you think someone is attempting to scam you.”
If your computer is hacked like Evelyn’s was, it’s important to shut it down and bring it to a trusted technician who can remove any viruses or malware.
Eisenhower said the families of seniors can help by learning more about scams, talking to their loved ones about them and reading resources like Managing Someone Else’s Money, a publication her office created to help financial caregivers.
4. If you are scammed, know you’re not alone. Evelyn struggled after realizing she had been deceived. “I felt violated, taken advantage of and depressed,” she said.
But Eisenhower said victims shouldn’t blame themselves; and if you are defrauded, report it. “Reporting and early intervention are vital to preventing loss and recovering loss when possible,” she said.
Nowadays, Evelyn feels confident that she won’t be tricked again.
“Some people lose much more money to scams. I lost $300, but I’m more skeptical now,” she said. “That’s a small price to pay for a good lesson.”