How to avoid

Top 10 scams targeting seniors

Every year, senior citizens lose tens of thousands of dollars due to scams. The elderly are often targets for fraud schemes because it is believed they hold the most wealth and will be an easy target, especially when they’re using new technology or devices. At Availa Bank, we want to help. Keep reading to learn more about the latest financial scams targeting seniors. Remember, you can always reach out to your local Availa Banker if you’re unsure whether a message or call you received is a scam attempt. They can walk you through the common signs of a scam attempt and lock down your account if needed.

#1: Government Official Impostor Scams

One of the most common ways scam artists try to gain personal information is through phone calls where they pose as a representative for Medicare, the IRS, or another government agency to try and convince you that your personal information needs to be updated to continue receiving care. They may also try to convince you that you have not paid a fee and need to settle it immediately to avoid further fines or going to jail. It is important to remember that any government agency will not use the phone as their first form of communication with you and will not demand payment over the phone.

If the person on the phone is pressuring you to act now, don’t give in. Find the real contact information for the organization they say they’re from, whether that’s through old mailings or by doing research online. If the information they provide (name, phone number, organization details) does not match your research, it is likely they are a scam artist. Hang up the phone and report the attempted fraud to the organization, the police, and through the Federal Trade Commission’s (FTC) website:

#2: Counterfeit Prescription Drug Scams

It’s no secret that prescription drugs can be expensive. As you get older and need different medications, your insurance doesn’t always cover it all, which can create stress for you. You may do some research online to try and find cheaper alternatives to your current medication, but that’s not always safe. Fraudsters have taken advantage of this issue by selling counterfeit prescription drugs online. These drugs can be incredibly dangerous as you don’t know the ingredients and may experience severe health problems after you take them.

Remember, if it seems too good to be true, it probably is. Always go to a reputable pharmacist instead of looking online for your prescriptions. Don’t be afraid or embarrassed to ask about reducing your prescription costs. Ask your pharmacist (and your doctor) if it’s possible to switch to a generic version of your medication or if they have any coupons available for your prescriptions. Some pharmacies offer prescription rewards programs or something similar if you go to them often for your medications. You may even want to shop around to see if other pharmacies are offering the same or better prices.

#3: Funeral and Cemetery Scams

It may or may not come as a surprise that scam artists are using a sad and vulnerable time in a person’s life for their personal gain. A questionable funeral home may try to convince your grieving relatives that they need to buy the most expensive casket or other services for your funeral. Often these add-ons or special services are not worth the costs and your family may fall into debt just to cover it. The second major scam involves fraudsters reading obituaries in the local paper and attending strangers’ funerals, claiming they had an outstanding debt with the deceased. They may pressure your family members into giving money immediately. In their grief, your family may agree, causing them to lose a significant sum.

You can outsmart these scam artists by planning your funeral with your loved ones before your death, even down to the smallest details such as what food to serve at your funeral luncheon and whether you want to be buried vs. cremated. Having these wishes in writing will make it harder for non-reputable funeral homes to pressure your loved ones into a different kind of funeral. You should also be open with your family about your financial situation before your death so that they know about any outstanding debts and who to pay. This way, strangers can’t claim you owed them money after you’re gone.

#4: Telemarketing Scams

Did you know older adults tend to make more telephone purchases than any other age group? It is believed that they are more likely to buy over the phone because they are lonely and more welcoming to a conversation with a stranger. Unfortunately, this can open you up to a whole mess of telemarketing scams. These are some of the worst scams as they are hard to trace and often result in personal information being shared with other scammers who may try to take advantage of you. Some of the most common telemarketing scams include:

  • Pigeon Drop: You may be told that someone has come across a lot of money and that they will split the money with you if you pay the fees. This person usually poses as a banker or a lawyer so that they seem more trustworthy.
  • Fake Accident: The telemarketer will pretend that one of your relatives is in the hospital and requires some money. They will then give you instructions on how to transfer said money to your relative when it’s really being transferred to the scammer.
  • Charity Scam: Any time there is a natural disaster or other humanitarian crisis, scam artists often pretend to be part of a major charity collecting donations. It’s always best to research a charity before you decide to donate, just to be safe.

You can keep yourself safe from these kinds of scams by not answering phone calls with telephone numbers you don’t recognize. If you do pick up the phone and are in a conversation with a potential scammer, stay vigilant. Do they ask for your personal information? Do they want you to donate money right now? Do they get increasingly pushy if you don’t agree to their demands right away? All of these are warning signs that the person on the other end of the phone is a scammer. Do not give them any of your information and hang up the phone. Report the attempted fraud to the correct authorities and block the number in your phone so you do not accidentally answer them again.

#5: Reverse Mortgage Scams          

Reverse mortgages are for older homeowners who either own the property outright or have a significant amount of equity in it. These mortgage holders do not have to repay the loan to the lender by making monthly payments but can have their loans paid out to them with a line of credit, monthly payments, or a lump sum. In most cases, this loan will not have to be paid back until the homeowner sells the property, moves out of the property, or dies. This might sound ideal, but the loans can be expensive and come with very complex mortgage terms. A scammer may use the following tactics to get you to agree to their terms:

  • Aggressive sales pitches that make you feel like you NEED to take out a loan
  • Tricky advertising that phrases a reverse mortgage as “free money”.
  • Telling you that a reverse mortgage means you will never lose your home. Your property can still be foreclosed upon if you do not follow all the specific mortgage obligations.
  • Only including the older member of the couple on the mortgage agreement. If the older spouse that is on the mortgage passes away first, you could potentially lose your home and have to pay the loan in full, depending on where you live.
  • Convincing you to take out a reverse mortgage too early. If you take it out in your 60s and have it paid in one lump sum, you may use it all quickly and have no money to pay your property taxes or insurance premiums down the road.

To avoid this, do not fall for claims from anyone that says it is possible to own a property without making down payments. Never sign anything you do not 100% understand and never accept payment from anybody for a home that you haven’t purchased yet. Always search for a reverse mortgage counselor yourself and seek lots of information from them. You can never ask too many questions when it comes to large financial decisions.  

#6: Sweepstakes and Lottery Scams

This is one of the most popular scams targeting seniors, and one of the more costly ones. Sometimes scammers can collect thousands of dollars from their victims before the scam is realized. Sweepstakes or lottery scams involve a fraudster informing you that you have won sweepstakes or a lottery of some kind and need to make a payment to unlock the prize. Often you will be sent a check to deposit in your bank account, but after a few days, the check will be rejected. Usually, the scammer will quickly ask you for the fees/taxes on the prize while the check is still processing. After the check bounces, the “prize money” will disappear from your account, along with the rest of your money.

To avoid falling prey to this scam, never deposit a check from someone you don’t know or weren’t expecting payment from. If they pressure you to provide funds, do not give in. Instead, contact your local bank branch and report the phone number to the FTC.

#7: Grandparent Scams

This scam is effective as it preys on the target’s heart. A fraudster will call you and pretend to be a grandchild, saying, “Do you know who this is?” When you name one of your grandchildren, the scammer will be able to establish their fake identity. Then the scammer will bring up an unexpected financial issue like overdue rent, car repairs, or jail bond and ask for money. They will tell you not to tell anyone because they are embarrassed or afraid.

You can avoid this scam by making the person on the other line state their name first. Do not give them any clues that will allow them to pose as your grandchild. They will often pressure you for money in the form of gift cards or a money transfer. Do not do this until you have verified whether or not the person on the phone is your grandchild. Once you have given them money this way, it is incredibly hard to get back, so you want to be as cautious as possible.

#8: Online Romance Scams

As we said before, it’s common for older adults to experience loneliness as they age. This has led to a rise in online romance scams targeting this age group. Romance scammers will create detailed dating profiles with their location often set to another country. They will ask for money to pay for visas, medical emergencies, or even travel expenses to come and visit you. Because they build their connection with you over time, they are often able to get more money from you. In fact, each year seniors lose 10s of millions of dollars to these kinds of romance scams.

You can avoid a romance scam by never sending money to someone you’ve never met in person. If the conversation turns to money or other personal questions, always be cautious. Do not tell this person where you live, where you work, or other personal details that would allow them to steal from you. Always say no to requests for suggestive photos or videos as well. These can be used against you as blackmail if you do not agree to pay them what they ask for. If you become uncomfortable with the way a conversation is going online, you can always block them and report them to the dating website you’re using. They have a policy in place to investigate scammers and block them from returning to prey on another vulnerable person, but it’s not always 100% effective, so stay alert when communicating online.

#9: Celebrity Impostor Scams

Sometimes celebrities use their star power and influence to perform charitable deeds for others. During the pandemic, several celebrities made headlines for organizing social media giveaways where they randomly selected some of their fans to receive a cash prize. Scammers quickly pounced on this opportunity to create fake profiles and gather people’s personal information.

It’s important to know which of these giveaway posts are real, and which are fake. Luckily, you can typically tell a fake celebrity account from a real one in a few different ways. Typically, a scammer will not be able to claim the real celebrity’s name for their account as it is already taken. If the account has some variation of the celebrity’s name with numbers and symbols, the name is spelled wrong, or it has odd punctuation, it’s likely this is a fake account. You should look at the content of the post as well. Is it filled with typos? Does it include links for you to click on? Don’t fall for these tricks, it’s likely a scammer. Some social media sites like Twitter have a process for celebrities and other high-profile individuals to verify their accounts to make sure everyone knows which account is the real one, but this is not a foolproof method of verification, and you should always investigate before sharing any information publicly on the internet.

Any time you’re posting your bank account information or your cash-transfer app identifier (ex. Venmo, PayPal, Zelle), you are opening yourself up to potential scam artists. If you do post your cash-transfer app information and end up getting odd requests, you can always block any incoming requests on your cash-transfer app from people you don’t know. You can’t do the same with your bank account information. Always remember that if you really did win money, they won’t ask you to send some first. Winning “free money” is always appealing, but it’s never worth risking identity theft.

#10: Elder Financial Abuse by Someone You Know

This is one of the worst kinds of abuse that happens to millions of older adults each year. As you age, you may face serious health issues or suffer from dementia which requires you to establish someone to take care of you and your assets, such as a family member, friend, lawyer, caregiver, or power of attorney. Scammers take advantage of this situation by getting to know you and building your trust over time. This is a heartbreaking situation, but it’s made a lot worse when it’s done by someone you know and believe you can trust. When the scammer wants your money, they may withhold much-needed care or try to blackmail you to gain control over you. This has sadly become quite common for the most vulnerable in our society and can be hard to spot if the victim suffers from severe health issues that prevent them from communicating clearly.

If you suspect you are becoming a victim of this scam or believe someone else is, talk to someone who is not directly connected to the abuser. This could be a family member, friend, child, or even a lawyer. Tell them what is going on and ask for their help in removing that person from a position of control over you. If possible, before you enter into an agreement with a caregiver, lawyer, or power of attorney, make sure your assets are protected through multiple channels so that the scammer can’t gain access easily. Be vocal about your wishes to your family, friends, and others relating to your assets before it is too late so that it is easier for others to spot the scammer if you are unable to communicate later on.

Our Best Scam Advice? 

Never let anyone take advantage of you online, in person, or over the phone. If you are feeling pressured to do something, you always have the right to say no. No legitimate organization will try to force you to send them money immediately and you should never pay money to receive money. Always do your research to make sure the person you are speaking with is a legitimate representative of that company and don’t give out any personal information to anyone until you have verified that they are who they say they are.

If you have any questions on what may or may not be fraud, you can always reach out to your local Availa banker for answers. We’re here to help keep your money safe. If you’ve accidentally fallen victim to a fraudster already, make sure you report it and contact us to make sure your account stays safe.