Opinion: Older people are targeted by scammers — even their own family members. How to protect them | #scams | #elderlyscams
recently released I Care A Lot, a movie which centers on a seemingly saintly entrepreneur who runs a thriving business as a court-appointed guardian for elderly individuals who can no longer manage their own care.
But there’s a catch: the character is systematically defrauding her vulnerable clients, conspiring with doctors and nursing home administrators to identify susceptible targets, seizing legal control of their lives, then auctioning off their assets to pay herself for her services.
The film has been a hit. According to Esquire.com, I Care A Lot vaulted into Netflix’s top 10, and its lead protagonist, Rosamund Pike, won a Golden Globe for her performance.
The exact nature of the scam that underpins I Care A Lot may be far-fetched, but the premise of elder financial abuse is grounded in reality and deserves far more attention and consideration. It continues to be a pervasive and expensive problem estimated to rob America’s vulnerable elderly of billions of dollars a year.
In the current environment, where new scams have emerged and social distancing has increased senior isolation, it’s paramount to take steps to safeguard seniors’ financial health from abuse. According to a 2019 AIG Life & Retirement survey, more than half of Americans (53%) say that elder financial abuse is likely to compromise their ability to live a long, financially secure life and nearly two-thirds (65%) say the same for a close relative or friend.
Read: Crooks are coming for your coronavirus and stimulus checks
Heightening this concern, almost half (47%) of seniors 65 or older manage their finances—from paying bills to handling investments—entirely on their own. As a result, many leave themselves vulnerable to financial abuse, whether through financial scams perpetrated by strangers or financial exploitation conducted by family or friends.
With 10,000 Americans turning 65 every day, the number of people living with cognitive decline is reaching unprecedented highs—leaving many vulnerable to manipulation, deceit and abuse.
Given the reality of cognitive decline, financial isolation comes with real risks. We believe that by building a system of checks and balances, seniors (together with their families and financial advisors) can more effectively safeguard their finances from exploitation, manipulation or financial imprudence.
- Families should consider having conversations as early as possible and involving several parties to build an infrastructure of protection.
- Financial advisers can serve as an added line of defense, acting as an impartial third party, staying alert for red flags, facilitating family conversations and using protective tools like trusted contact and power of attorney.
- Employers can also educate employees and retirees to protect against potential threats of scams, lessening stress and boosting productivity.
Some common types of elder financial exploitation to look out for include:
- IRS impersonation scams: Calls from the IRS claiming that you will be arrested if you don’t pay up on missing taxes. Keep in mind that government agencies rarely call people. If they do it will be only after sending you a letter first or calling you back. If the alleged government agency calls and asks for sensitive personal information or a wire transfer, it’s a scam. Also remember not to trust caller ID—scammers can disguise their number.
- Robocalls and unsolicited phone calls: According to the Federal Communications Commission, there are nearly 2.4 billion robocalls made every month. Today, phone calls can be digitized and routed from anywhere in the world. Don’t give out personal information unless you initiated the call.
- Lottery/sweepstakes scams: Seniors are made to believe that they have won a lottery and need to pay a fee to collect their winnings. After seniors send the money via prepaid debit card, electronic wire transfer, money order or cash, they get 50-100 phone calls a day demanding more money.
- Grandparent scams: Imposters pretend to be your grandchild or an authority figure holding your grandchild. They claim the grandchild is in trouble and needs money to help with an emergency, tricking grandparents to wire them money. Scammers say not to alert the grandchild’s parents. Ask some simple questions that only your grandchild would know the answer to.
- COVID-19 scams: The Federal Trade Commission has sounded the alarm on products falsely claiming to treat or prevent the novel coronavirus, as well as fake charities. Be wary of alleged government calls to set up COVID-19 tests and avoid phishing emails touting vaccinations and home test kits.
Whether family lives minutes away or on the other side of the country, staying in touch with an aging loved one can help prevent senior isolation, reassure the senior that they can rely on family if they become victimized by fraudsters, and help family spot signs of cognitive decline or abuse.
Michele Kryger is head of AIG’s elder and vulnerable client care unit.