U.S. Senate Special Committee on Aging:
Chairman Susan M. Collins, R-Maine
Ranking Member Bob Casey, D-PA
Frauds that made the Senate aging committee's 2017 rankings include:
• Sweepstakes scams, run by perpetrators who contact victims by phone, tell them they have won a financial prize, and then require advance payment of a fee to collect the purported winnings.
• Robocalls, using advanced electronic technology that enable would-be scammers to maximize the number of potential victims reached.
• Computer scams a fraud in which callers impersonate representatives of well-known technology companies and convince victims to allow remote access to their home computers to check for problems. The scammers then charge fees to remove purported electronic viruses.
• Elder financial abuse, in some cases involving relatives or friends who gain access to victims' identification data, bank accounts or other records.
• Grandparent scams, a con game in which fraudsters phone with phony claims that a grandchild is in trouble and needs help paying a hospital bill, returning home from overseas or gaining release from jail.
FBI, Scams and Safety
In fact, seniors lose billions of dollars a year to home repair scams, investment scams, IRS scams and various other cons targeting older people. The FBI’s Common Fraud Schemes webpage provides tips on how you can protect yourself and your family from fraud. Senior citizens especially should be aware of fraud schemes for the following reasons:
· Senior citizens are most likely to have a “nest egg,” to own their home, and/or to have excellent credit—all of which make them attractive to con artists. People who grew up in the 1930s, 1940s and 1950s were generally raised to be polite and trusting. Con artists exploit these traits, knowing that it's hard or impossible for these individuals to say “no” or just hang up the telephone.
· Older Americans are less likely to report a fraud because they do not know whom to report it to, are too ashamed at having been scammed, or don’t know they have been scammed. Senior victims may not report crimes, for example, because they are concerned that relatives may think the victims no longer have the mental capacity to take care of their financial affairs.
· When an older victim does report the crime, they often make poor witnesses. Con artists know the effects of age on memory, and they are counting on older victims not being able to supply enough detailed information to investigators. Also, the victims’ realization that they have been swindled may take weeks—or more likely, months—after contact with the fraudster. This extended time frame makes it even harder to remember details from the events.
· Senior citizens are more interested in and susceptible to products promising increased cognitive function, virility, physical conditioning, anti-cancer properties, and so on. In a country where new cures and vaccinations for old diseases have given every American hope for a long and fruitful life, it is not so unbelievable that the con artists’ products can do what they claim.
NCOA [National Council on Aging]
Financial scams targeting seniors have become so prevalent that they are now considered “the crime of the 21st century.” Why? Because seniors are thought to have a significant amount of money sitting in their accounts.
Financial scams also often go unreported or can be difficult to prosecute, so they are considered a “low-risk” crime. However, they are devastating to many older adults and can leave them in a very vulnerable position with little time to recoup their losses.
It is not just wealthy seniors who are targeted. Low-income older adults are also at risk of financial abuse. Moreover, it is not always strangers who perpetrate these crimes. Over 90% of all reported elder abuse is committed by an older person’s family members, most often their adult children, followed by grandchildren, nieces and nephews, and others.
1. Medicare/Health insurance scams
Every U.S. citizen or permanent resident over age 65 qualifies for Medicare, so there is rarely any need for a scam artist to research what private health insurance company older people have to scam them out of some money.
In these types of scams, perpetrators may pose as a Medicare representative to get older people to give them their personal information, or they will provide bogus services for older adults at makeshift mobile clinics, then use the personal information they provide to bill Medicare and pocket the money.
2. Counterfeit prescription drugs
This scam is self-imposed, as seniors are seeking ways to buy cheaper prescription drugs. Don't do it. Most commonly, counterfeit drug scams operate on the Internet, where seniors increasingly go to find better prices on specialized medications. This scam is growing in popularity—since 2000, the FDA has investigated an average of 20 such cases per year, up from five a year in the 1990s. The danger is that besides paying money for something that will not help a person’s medical condition, victims may purchase unsafe substances that can inflict even more harm. This scam can be as hard on the body as it is on the wallet.
3. Funeral and Cemetery scams
The FBI warns about two types of funeral and cemetery fraud perpetrated on seniors.
In one approach, scammers read obituaries and call or attend the funeral service of a complete stranger to take advantage of the grieving widow or widower. Claiming the deceased had an outstanding debt with them, scammers will try to extort money from relatives to settle the fake debts.
Another tactic of disreputable funeral homes is to capitalize on family members’ unfamiliarity with the considerable cost of funeral services to add unnecessary charges to the bill. In one common scam of this type, funeral directors will insist that a casket, usually one of the most expensive parts of funeral services, is necessary even when performing a direct cremation, which can be accomplished with a cardboard casket rather than an expensive display or burial casket.
Another tactic of disreputable funeral homes is to capitalize on family members’ unfamiliarity with the considerable cost of funeral services to add unnecessary charges to the bill. In one common scam of this type, funeral directors will insist that a casket, usually one of the most expensive parts of funeral services, is necessary even when performing a direct cremation, which can be accomplished with a cardboard casket rather than an expensive display or burial casket.
In early 2017, NCOA warned of three new scams that were prevalent:
Mass mailing fraud: The U.S. Department of Justice has seen a spike in mass mailing fraud targeted at the senior citizens. This scam involves personalized, sometimes “registered” letters in your mailbox that appears to indicate you have won a sizable prize and just need to pay a small processing fee for it to be sent to you.
Older Americans have lost millions of dollars in this scam, and unfortunately, responding to such a letter targets the person for future fraudulent mailings.
Tax Scheme
Two types of IRS scams have been making the rounds in the past year:
• Fake notices that claim you owe money as a result of the Affordable Care Act (“Obamacare”). These are especially tricky, says the Federal Trade Commission, because their design mimics the real IRS notices.
• Automated calls from the IRS claiming that you owe back taxes, and requesting you pay via gift card. Sometimes these fake IRS calls are not automated, but rather a live person calling from a Washington, DC area code (202) using high-pressure scare tactics to get your money (for example, saying the police are coming to arrest you for not paying your taxes). There are several red flags and tips to know whether you are dealing with the real IRS vs. a scammer:
o The IRS never initiates contact with you via phone call, email, or through social media. If you get one of these calls, block it. If you get an email, put it into SPAM. Delete if contacted via social media.
o The IRS cannot threaten to have you arrested or deported for not paying.
o You will never be asked to pay using a gift card, pre-paid debit card, or wire transfer; the IRS also never takes credit/debit card information over the phone.
o If you owe the IRS back taxes, you will always have the opportunity to question or appeal the amount.
o Dubbed by the Treasury Inspector General for Tax Administration as the most pervasive impersonation fraud in IRS history, the swindle involves suspected scammers based in the U.S. and India who telephone Americans and threaten arrests unless purported tax debts are not paid immediately. At least 1.97 million people have been targeted, with as many as 200 victimized per week during the scam's peak last year, according to the inspector general.
Back or Knee Brace Post Card:
You receive a colorful postcard stating that the sender has been trying to contact you about ordering a Medicare-covered back or knee brace. All they need is for you to send your Medicare information. What’s to lose? This scam is particularly insidious, because you may actually receive something in the mail, usually a Velcro-style band for your back or knee. The scammer then bills Medicare for a device worth hundreds or thousands of dollars more than the one you received. Moreover, armed with your Medicare information, they can continue to bill Medicare for services not rendered. Medicare has strict coverage rules for its services and supplies, and it pays to keep these tips in mind:
• Never respond to open solicitations for Medicare-covered supplies/services.
• Only provide your Medicare number to health care providers or facilities at the time you are actively seeking service.
• Carefully monitor your Medicare statements for any claims for services or supplies billed to you which you did not receive. You can set up an account at MyMedicare.gov and access your claim information online anytime.
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