How to Protect Your Loved Ones: Combating Elder Fraud

What is Elder Fraud?

Elder Fraud refers to the unethical or unlawful exploitation of elderly individuals for financial gain. There are many forms of elder fraud where unscrupulous actors attempt to take advantage of elderly individuals' goodwill. This article highlights the prominence of elder fraud cases, potential tactics used by bad actors, and strategies to shield older individuals from financial exploitation.

Statistics on Elder Fraud

According to the FBI’s Internet Crime Complaint Center, individuals aged 60 or older lost approximately $3.4 billion to elder fraud in 2023.

Year-over-year losses increased 11% from 2022, with almost 6,000 individuals losing approximately $100,000 each, and an average loss totaling $33,915 to scams aimed at older individuals.

The top five most costly elder fraud complaints reported to the FBI in 2023 were:

• Investment Scams
• Tech Support Fraud
• Personal Data Breaches
• Romance Scams
• Non-payment/Non-delivery Issues

Florida had the second-highest number of complaints and losses, totaling $294 million. Georgia, Tennessee, and Alabama also saw significant complaints and financial losses.

Types of Elder Fraud

Investment Scams comprised 35% of the losses reported to the FBI in 2023. These types of scams often involve fraudulent investment opportunities with promises of high returns and low levels of risk. Examples of investment scams include Ponzi Schemes, High-Yield investment programs, precious metal scams, Investment Clubs, Fake Charitable Investments, Cryptocurrency scams, etc. Many older individuals attempt to find ways to supplement their retirement income leaving the door open for scammers.  It is important to always research the legitimacy of investment opportunities.

Prevention Tips:

• Research Investments: Always verify the legitimacy of investment opportunities through credible sources.
• Seek Professional Advice: Consult with a financial professional before making any significant financial decisions.

Technology Support Fraud and Personal Data Breaches comprised a significant portion of the losses reported in 2023. As we progress further into the 21st century the occurrence of fraud through technological channels becomes more common. Internet scammers can gain access to your personal information through emails (phishing) and phone calls. Once a victim has become compromised, scammers can either sell their information on the dark web or even defraud the victim of their assets.

Prevention Tips:

• Phishing Emails: Emails pretending to be from legitimate tech companies asking for personal information or installing malicious software should be immediately deleted and blocked.
• Use Strong Passwords/Dual Factor Authentication: Employ strong, unique passwords for different accounts and enable two-factor authentication.
• Monitor Financial Statements: Regularly review bank and credit card statements for unauthorized transactions.

Romance Scams are a prevalent form of fraud targeting elderly individuals. These types of scams prey on the emotional vulnerabilities of older individuals. Often scammers will employ manipulative tactics to gain the trust or affection of an older individual to defraud them of their assets. Examples could include individuals reaching out via dating sites or social media where the scammer looks to build a relationship with the victim expressing love and commitment. Once they have established a relationship with the victim, the scammer could fabricate a crisis or emergency requiring urgent financial help from the victim.

Prevention Tips:

• Verify Profiles: Always verify the identity of someone you meet online and be cautious of requests for money.
• Consult Trusted Individuals: Share your online interactions with friends or family for a second opinion.

Non-payment/Non-delivery issues occur when scammers pose as a legitimate business attempting to convince potential victims that they are behind on payments for goods or services that are bogus. A common example of this con is scammers posing as a government or utility entity requesting information or payment for a service that is otherwise in good standing and paid in full. In these types of scenarios, it is always important to verify that the “entity” you are “communicating with” is legitimate.

Prevention Tips:

• Research Before Payment: Verify the legitimacy of sellers and service providers.

• Use Secure Payment Methods: Opt for payment methods that offer fraud protection, such as credit cards.

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Elder fraud is becoming increasingly popular as our population ages. Awareness and active prevention are key to protecting yourself or loved ones from falling victim to these scams. If you suspect fraud or exploitation, it is crucial to act quickly and seek assistance. The National Elder Fraud Hotline is available to anyone 60 or older who has experienced financial fraud at 1-833-372-8311. The hotline is open Monday through Friday from 10am to 6pm EST.

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