Financial Exploitation of Seniors: The Top Scams

Financial exploitation occurs when a person misuses or takes the assets of someone for their own personal benefit. Seniors are highly vulnerable to financial exploitation. Depending on the study, estimates of annual losses from financial exploitation of seniors range anywhere from $3 billion to nearly $40 billion a year. 

There are many reasons why seniors are so susceptible to financial exploitation. First, many seniors suffer from cognitive decline, which results in diminished judgment and decision-making skills. This makes them less able to differentiate a real situation from a contrived one. And because of high levels of social isolation, many elders welcome any kind of communication and may not be sufficiently skeptical of fraudulent situations they encounter. Another reason elderly people are vulnerable to financial scams is that many of them lack technological sophistication, and financial scams often use complex digital technology. The following is a summary of the top five scams targeting seniors, along with an overview of how they typically unfold.

Top Financial Scams Targeting Seniors

“Grandma, I Need Your Help!” 

In the so-called Grandparent Scam,  a scammer tricks a senior into thinking that their grandchild is calling and needs help. The caller may start by saying something like “Hi Grandma, who do you think this is?” Typically, the senior will impulsively say a grandchild’s name, arming the scammer with personal information. The scammer often acts as if he is in trouble, either needing money for medical care, car repairs, school books, or something similar. In some cases, the scammer, acting as the grandchild, will say he’s in legal trouble. This Grandparent Scam is effective because it preys upon emotions to pressure victims into sending money as quickly as possible. People who run Grandparent Scams often ask to be paid through gift cards or wire transfers, which don’t require identification to collect.

“We Need Your Social Security Number Now To Protect Your Account!” 

So-called Financial Services Scams often appear to come from a legitimate source, such as a bank, a credit card company, a mortgage company, or a similar entity.  Scammers call, text, or send email messages that look and sound real by simulating legitimate email addresses and links. These fraudsters may claim that a checking or savings account has been compromised and request personal information, such as a password or Social Security number. They may promise better rates or terms on a home loan. Or they may threaten legal action for unpaid bills. Each of these types of claims is a fabrication, but scammers know how to be convincing. Typically, individuals committing this type of fraud will demand immediate payment through platforms such as Zelle, Venmo, or PayPal. 

“Your Computer Is At Risk!” 

In Technical Support Scams, scammers prey upon the ignorance that many people, including seniors, have about computers. Tech support scammers want you to believe you have a serious problem with your computer. They may say something like “I’m from Microsoft, and your computer has a virus,” and ask for permission to log in to your device remotely to fix the problem. These scammers typically request money to fix the problem and suggest wiring money or putting money on a gift card or prepaid card, as they know these types of payments can be difficult to reverse.

“I’m From The Federal Refund Department.” 

In Government Impersonation Scams, fraudsters pretend to be from government agencies, offering or demanding certain things. For example, the caller may claim that you’re entitled to a refund for a government payment you’ve made and ask for your bank account number. Or they may claim to be from the U.S. Internal Revenue Service and make threats if certain payments aren’t made. Government imposters may demand prepaid debit cards, cash, or wire transfers as payment. 

“I Just Met You, But I Love You!”  

Every year, thousands of people who engage in online dating are duped by so-called Romance Scams. In these situations, scammers create fake social media profiles and use them to gain trust and steal money. In some cases, these scammers may be overseas. They may ask their victims to pay for visas, medical emergencies, and travel expenses to come to the U.S. The U.S. Federal Trade Commission found that in 2023 alone, more than 64,000 people reported a romance scam, with losses totaling $1.1 billion.

Other Types of Financial Exploitation

Financial exploitation of elders occurs in various ways, not just through scams. While the kinds of scams we’ve discussed above are generally perpetrated by strangers, many elders are financially exploited by their own family members or trusted caretakers. In fact, more than half of all financial exploitation of seniors is perpetrated by people close to them. Exploitation can include direct theft, abusing a power of attorney, or coercing assets from a bank or investment account. 

Signs of financial abuse can include fraudulent signatures on financial documents, unpaid bills, and/or unusual changes in spending habits and patterns. If you suspect that an elder you care about has been exploited financially, it’s important to take one or more of the following steps:

• Communicate with the elder
• Report suspected exploitation to the proper authorities, which could include your local Adult Protective Services, or the state or local police
• Call the National Elder Fraud Hotline at 833-FRAUD-11 (833-372-8311)
• Document the theft or other exploitation as soon as possible
• Seek legal advice from a Long Island elder lawyer

There are state and federal criminal penalties for financial abuse. 

Speak to a Long Island Elder Care Attorney Today

Here at Davidow, Davidow, Siegel & Stern, our clients are like family. When our clients engage us, we offer legal advice and counsel that teaches families how to protect their assets. While we cannot protect you or your loved one from being scammed, feel free to contact a trusted Long Island elder care attorney to ensure your assets are protected from any potential scammers before possibly being scammed.