Elder Abuse: Common Financial Scams Against Seniors and How to Avoid Them

Senior scams continue to be rampant, forcing law enforcement officials to crack down on criminals who target older adults, and organizations like the FBI to put out alerts warning seniors about scammers attempting to steal their money, either by phone or online.

Fortunately, there are many ways to spot these scams to avoid becoming another victim. This article takes a look at elderly financial abuse conducted by phone or online, including the Social Security scam, a new twist on the grandparent’s scam, the technical support scam and natural disaster scam.

We’ve obtained input from the FBI, Better Business Bureau and other sources to offer you the latest information about phone and internet financial scams that target elders.

We’ve also obtained information from two top experts for this topic, including Detective Timothy Lohman, who solves forgery, fraud and financial crimes in Southern California; and Scott Spiro, a Cyber Security Expert and Co-Founder and Director of Business Development at SugarShot in Los Angeles who is known as “Los Angeles’ Cybersecurity Expert.”

Social Security Scam

In 2019, one of the biggest financial elder abuse involves criminals attempting to obtain their Social Security number, said Spiro, who is a member of the United States Secret Service, LA Electronic Crimes Task Force, where he leads a crusade against online privacy and security issues encompassing cybercrime, government spying and all other harmful uses of technology.

In the Social Security scam, a criminal makes a fraudulent phone call claiming to be from the IRS or Social Security Administration. The caller claims that there’s some sort of legal action that will be taken if the person doesn’t provide an updated Social Security number, or needs to confirm their existing Social Security number.

This scam is sophisticated in that the criminal can “spoof” the actual number of the Social Security hotline, which means when they call, the number popping up on the recipient’s phone will be the actual number of the Social Security hotline or another number associated with the Social Security Administration. Spiro noted that the number for the Social Security hotline is 800-772-1213, and when a scammer calls, “it looks like the real deal because it’s coming from that number…and this is the kind of thing that can be really dangerous.”

The dangers of giving out your Social Security number lies in the fact that a criminal can use the number to steal your identity, which can then be used to open bank accounts, credit cards and other ways they can rob you of your hard-earned money.

Criminals attempting this scam will play on the senior’s emotions by saying legal action will be taken if they don’t provide their Social Security number, Spiro warned, adding that’s important for an older adult to be wary of any caller that attempts to gather this information.

“The Social Security organization is never going to make threats,” Spiro emphasized. “They’re never going to threaten a senior with arrest or legal action – they’re not going to ask you to provide a Social Security number.”

He noted that a legitimate Social Security organization will go to great lengths to keep your personal information private. For example, any time you get mailed an actual Social Security card, legitimate organizations send it in a plain envelope, and your card is wrapped in a way that the number cannot be seen from the outside. “That’s all in an effort to keeping those numbers secret,” Spiro said.

Another twist of this scam involves criminals claiming they want to help a senior “activate” their number, and will charge a fee for the service. “In that case, they get a Social Security number and they get money,” Spiro said.

If this scam ever happens to you, Spiro advises to report it immediately to the Office of the Inspector General at the Social Security Administration by phone at 800-269-0271 or online.

Spiro’s takeaway advice for this scam: “We’re in an age where everything is far-fetched. You have to look at everything with a grain of salt.”

Grandparent’s Scam

In a typical scenario of this scam, which has been around for several years, a fake grandchild will call a legitimate grandparent, telling them they need money to get out of jail, and some criminals committing this crime might even get a person on the phone pretending to be a lawyer, who corroborates the lie by saying the money is needed immediately, Detective Lohman explained. He has dealt with cases in which a grandparent will say the caller sounded like their actual grandchild, and the caller might say he/she has a cold, and that’s why he/she sounds different.

These scammers might even take it one step further, with another scammer who pretends to be the judge on the phone. Detective Lohman noted that “our criminal system does not work like that – you don’t just give me money and I let your relative out of jail.” If it was, in fact, legitimate, “you have to go through the court process. If they’re being bailed, never pay it over the phone and never wire money.”

In the past, scammers committing this crime would dupe grandparents out of their funds by asking them to wire money, or purchase and mail out gift cards. In a new twist, Spiro said the Federal Trade Commission found that instead of using the method of wire transfers or gift cards, “a lot of these older adults are mailing cash,” adding that the median individual loss is $9,000. “They ask these seniors to divide the bills in envelopes and send them inside pages of magazines through FedEx or the postal service.”

Why do scammers request cash nowadays from seniors? For one thing, an older adult might likely not understand payment methods like bitcoin, a type of digital currency. Also, by requesting the bills be divided into different packages, “it just enables them to get a larger amount of money over time,” explained Spiro, adding that these scammers are often part of professional crime organizations that dedicate themselves to robbing seniors of their cash. So by dividing the funds, “it probably spreads the risk; if something was to be found, it’s not going to stop the entire operation.”

Why would a senior with so much knowledge and life experience fall for a scam like this? For one thing, Spiro said it could be because the older adult doesn’t hear very well. He noted that his own father got a call like this when he was in his early 80s, but the scammers failed. “He had fun with them until they finally hung up because they got very frustrated – but it’s still scary,” Spiro said. “What if you’re in your 90s and you can’t hear very well, especially if it’s a grandchild you haven’t heard from in a while?”

If you receive a call like this, Spiro advises to “call the grandchild back on their number and verify their whereabouts. And if you’ve mailed cash, report it to the mail service or shipping company immediately, or file a complaint with the FTC.”

Technical Support Scam

Another popular elderly financial abuse is the technical support scam, in which an older adult receives a phone call from a person who claims they’re from a company like Microsoft, “and they say you’ve had an infection on your computer,” Spiro said. The scammer might also claim that something was installed on the senior’s computer, telling them they’re vulnerable to a computer virus.

The caller will say something like, “we need to help you out, and they ask for some sort of personal information or password for your email.” Once a scammer obtains this information, “they’ll use that to log into their email, and once in the email, they ... look for banking information, anything you might have in your email,” Spiro explained.

These criminals play on a senior’s emotions, with specific intentions to get them emotionally riled up, Spiro warned. His advice: “don’t take everything at face value.”

» For Further Reading: Tech Support Scams: How They Work & Tips to Avoid Them

Natural Disaster Scam

These scams typically occur after a natural disaster, like a wildfire or flood, and “it’s a golden opportunity for scammers,” Spiro said. “They talk to people who have and haven’t been affected,” he said, and these criminals will oftentimes impersonate someone representing a charitable organization.

These criminals are sophisticated in that some will even set up a fake website of the nonprofit organization they claim to be a part of, “and they’ll pretend on the guise of helping the victims to get a refund.”

To prevent yourself from falling victim to a scam like this, Spiro advises, “it’s about due diligence. Always be careful. Always look at everything from the standpoint, is this legitimate or not.” In other advice, “work with charities you know are legitimate,” and tell the caller, “I’m already working with a charity.”

» For Further Reading: Natural Disaster Scams: How They Work and Ways to Avoid Them

IRS Scam

According to the FBI, thousands of individuals have lost millions of dollars, as well as their personal information, to tax scams in which criminals use the regular mail, phone or email to “set up” people – including seniors.  

In a new twist on the IRS impersonation phone scam, criminals will make fake calls from the Taxpayer Advocate Service, which is an independent organization within the IRS. In this crime, a scammer will make a phone call to a victim and claim to be from the actual IRS. In a recent variation of this crime, a scammer can “spoof” the actual telephone number of the IRS Taxpayer Advocate Service office, which means that when the number pops up on your phone, it looks like it’s coming from the legitimate office. In some cases, this call will come in the form of a robocall in which the victim is requested to call back. However, once the person returns the call, a criminal will request personal information, such as a Social Security number, or an individual taxpayer identification number.

In other variations of the IRS impersonation phone scam, criminals will demand immediate payment of taxes, either by a prepaid debit card or wire transfer. “The callers are often hostile and abusive,” according to the IRS.

A few years ago, more than 700 people were arrested in India for a scam in which American citizens were called and told that they owed money to the IRS, Detective Lohman said, and fortunately, law enforcement was able to put people behind bars, and close the scam down. However, that doesn’t mean it’s over, “because there’s always a new scam.”

If you receive a call from the IRS, know it’s a fake, because “the IRS does not call you,” Detective Lohman said. “The IRS will send you a letter, and that letter will say you better do something or we’ll levy your property or bank account.” He added: “at no point will your local law enforcement show up at your house and arrest you.”

Some scammers have become savvy with this crime, to the extent of creating a fake IRS letter that they send in the mail. “Scammers have now resorted to using U.S. mail to complete their scams and the reason being that more people know the IRS does not call them,” Detective Lohman explained.

In a case like this, “do not send money, do not send a gift card, do not give them a number on a gift card, and do not wire them money,” Detective Lohman advised. And if they call you, “hang up the phone on them.” Additionally, if you receive a voice message from the IRS asking you to call them, “do not call the phone number that they leave for you.”

Instead, go to your local IRS office, speak with an agent and verify whether you owe money.

» Recommended Reading: Why IRS Scams Work and 7 Tips for Avoiding Them

Kidnap and Ransom Scam

The kidnap and ransom scam is like something out of the movies, in which a fraudulent caller will claim they’ve literally kidnapped one of your family members. Detective Lohman warned that these criminals are so good, that they’ll have somebody scream in the background, “and when we hear that, the sense of fear sets in.”

The scammer will then demand a ransom to let your loved one go, “and they will keep you on the phone for an extended period of time,” Detective Lohman said. “Why are they keeping you on the phone? So you can’t check to see if they really have your family member.”

The FBI refers to this crime as “virtual kidnapping scams.” Unlike traditional abductions, “virtual kidnappers have not actually kidnapped anyone. Instead, through deceptions and threats, they coerce victims to pay a quick ransom before the scheme falls apart.”

If you are a victim of this scam, first verify that your family member is not hurt or kidnapped. Verification is critical “before we do anything,” Detective Lohman advised. “Too many times people send the money first then they do the verification. My goal is to rewire that – verify and research first before you send money.”

How do these ransom scammers know people in your family? Because they do their homework on the internet on social media sites, like Facebook and Instagram, where some people tend to post pictures of their family members. Therefore, “be careful what you post on social media,” Detective Lohman advised. In other suggestions, he said if you don’t have privacy settings on your social media profile, “it’s very easy for me to get onto your Facebook and look at everything you post. I can find out who your kids are and your family members. If I want to scam you, this helps me.”

If the caller asks you not to tell anybody, “that’s a big red flag,” Detective Lohman added. “If this happens to you, I want you to tell somebody and verify and call your grandson or whoever they’re saying is in need.”

Just last year, the FBI put out a warning that the perpetrators of these crimes “are becoming more sophisticated,” and are using social media and social engineering to dupe people into thinking their loved ones have been kidnapped.

The FBI offers the following tips if you receive a phone call of this nature:

  • In most cases, the best course of action is to hang up the phone.

  • Attempt to contact the alleged victim via phone, text, or social media, and request that they call back from their cell phone. Contact family members to determine if they have been called as well.

  • If you engage the caller, never disclose your loved one’s name or provide any identifying information.

  • Try to slow the situation down. The success of any type of virtual kidnapping scheme depends on speed and fear. Criminals know they only have a short time to exact a ransom before the victims unravel the scam or authorities become involved.

  • Request to speak to your family member directly. Ask: “How do I know my loved one is OK?”

  • Ask questions only the alleged kidnap victim would know, such as the name of a pet. Avoid sharing information about yourself or your family.

  • Listen carefully to the voice of the alleged victim if they speak. Often it is someone posing as the kidnap victim.

  • To buy time, repeat the caller’s request and tell them you are writing down the demand, or tell the caller you need more time.

  • Do not agree to pay a ransom, by wire or in person. Never deliver money in person, which can be dangerous.

  • If you suspect a real kidnapping is taking place or you believe a ransom demand is a scheme, contact your nearest FBI office or local law enforcement immediately.

Jury Duty Scam

This scam involves a phone call from a criminal who says you missed jury duty, and their goal is to get the victim to pay a fine, as well as divulge personal information, according to the Better Business Bureau. In variations of this scam, fraudulent callers pose as law enforcement officials, members of the U.S. Marshals Service, bailiffs or court clerks. 

The scammer may go as far as giving a name of a real officer found on the internet, and obtain a local area code – even though they aren’t from that area, Detective Lohman warned. “Keep in mind that I can have Google Voice and sit there and talk to you from a local area code. But (the scammer) could live outside the country, so don’t believe it’s local.”

What’s the best way to handle a call like this? “Call the courthouse directly and ask if you missed jury duty,” Detective Lohman advised. “By all means, do not send money. Make sure you call and verify.”

The Better Business Bureau advises “to just hang up,” adding that jury notices are almost exclusively sent by mail, and no government department, police department or other institution will ever ask for payment by an untraceable method – nor will they demand personal information in unsolicited communications. 

Classified Ads Scam

Detective Lohman worked a case in which a man wanted to buy a travel trailer, found one on Craigslist, and started communicating with the seller through text messages and email. Once they agreed on a price – $15,000 – the seller requested the money be sent to a specific location. The man sent the money, didn’t get the trailer, and was out $15,000.

While researching the case, Detective Lohman found the fake seller’s email address and phone number, and plugged them into Google for a search, and realized it was a scam immediately. The man who got duped could have done the same thing, “had he done a little homework.”

Therefore, research and verification are keys to avoiding a classified ad scam. “If you buy anything online from a website like Craigslist, especially if it’s a big item, if you can’t see it, touch it, walk through it – do not buy it,” said Detective Lohman, adding that these scammers can steal photographs of items and sell them online, and in reality, they don’t have the item.

» Related: Common Used Car Buying Scams and How to Avoid Them

Romance Scam

Romance scams, also referred to as “confidence fraud” by the FBI, involves criminals attempting to take advantage of people seeking romance online through dating websites, apps, or social media. According to the FBI’s Internet Crime Complaint Center, romance scams result in the highest amount of financial losses to victims when compared to other online crimes.

The way these scammers work is by earning your trust, said Detective Lohman, adding the following example: “They say, ‘I want to come see you but I’m stuck at the border; I need you to send money so I can get there and we can spend our lives together.’”

He noted a case in which a woman sent $22,000 to a man she met on Facebook, and it turned out that the case was “a big triangle mess of scams” in which “all these ladies were sending money to one person.” When Detective Lohman returned $22,000 to one of the women, her emotions had still gotten the best of her, and she still didn’t understand how she got scammed, because “the romance talked and she believed it, and she saw a picture of him.”

In reality, “we don’t know who we’re really talking to,” Detective Lohman warned, adding that anyone can verify a person’s photograph by uploading the picture into Tineye.com or Google Images, where “you’ll see how many times the photograph was used.”

As an example, when Detective Lohman worked a timeshare scam, he took a photograph from the scammer’s fake website and uploaded it into Google Images. He discovered the photograph was used at several different real estate firms, and “they took pictures and spliced them together.”

With the romance scam, you might also be asked to open a bank account for the other person, who claims they will wire money into the account. “If someone asks you to open a bank account do not do it – you are helping a criminal enterprise by doing it,” said Detective Lohman, adding the following should also be considered: “If you can’t see or touch that person, why are you sending that person money?”

» For Further Reading: How to Spot a Romance Scam When Using Dating Sites

Work-From-Home Job Scam

Earlier in 2019, the Better Business Bureau reported that employment scams had more instances and higher losses than in previous years when it ranked the third riskiest. This crime can involve scammers who attempt to obtain personal information, like a Social Security number or bank account, which is ultimately used to commit identity theft.

In other variations, jobs associated with work from home scams include warehouse shipper, nanny, dog walker, mystery shopper, assistant aid and home care person, but ultimately, these scammers “want you to help the criminal enterprise by working at home,” Detective Lohman said. In one case, a man wanting to work from home posted his resume on Monster.com and Indeed.com, and was contacted by someone who claimed, “I got this perfect job for you, you can be a warehouse worker from home.”

Prior to the case, Detective Lohman received a report in which a credit card was compromised, and these two cases meet when a computer was sent to a house of the warehouse worker. It was soon discovered, “the laptop was bought with a stolen credit card.”

Detective Lohman went to the man’s house to inquire about the laptop, where he found other high-end items, including purses, electronics, phones, cameras, and computers. The unsuspecting man told the detective it was “his job to ship them out,” and this job involved opening up the boxes, taking a picture of it, putting a new shipping label on it, “and out of the country the products went. And it makes it very difficult for us in law enforcement to chase that stuff down.”

With that, Detective Lohman informed the man what he was doing was illegal, and that he was helping the criminal enterprise by shipping stolen goods. The man, still in disbelief, showed the detective his computer, where the “warehouse” was located, and the tracking numbers for the packages he was assigned to ship.

“I told him those things that you’re shipping are bought with stolen credit cards,” Detective Lohman said. “The guy had no idea he was involved in criminal activity. He thought he had a legitimate job but he didn’t.”

If you are looking for a job online, there are a few things to look out for, such as failure to list a specific location for the job. “I know we can apply online, but to get hired without ever meeting with somebody – that’s a clue.” Also, look for strange sentences or misspellings in online communication. “They are not English majors – they have a lot of spelling and grammar errors; you’re going to see those when they try to hire you.”

» For Further Reading: Common Work-From-Home Job Scams and How to Spot Them

Rental Scam

The rental scam involves a criminal pretending to have a home or apartment for rent that they’ll post on social media, like Craigslist or Facebook Marketplace, with photos and even a specific address. They might include an application and request you fill it out online, with questions including your current address, how much money you make per month, your phone number and email address.

These scammers might even take the step of emailing you the reasons why the house or apartment is for rent; in one case, a scammer emailed a potential renter, stating that he and his wife were busy running a charity out of state, and needed someone to rent their home, and take care of it “like it was their own.” This scammer even gave the potential renter a website to the nonprofit organization he supposedly worked for, which appeared legitimate online.

According to the Better Business Bureau, these scammers are copying legitimate posts advertising properties and then re-listing the properties as “for rent” with different contact information. These are known as “Hijacked Ads” and in some cases, may even use the name of the real person who originally posted it. Other scammers use what is referred to as “Phantom Rentals,” which means the listings do not even exist but are designed to lure you in. The goal of these criminals is to take your money before you have time to fully check them out.

Detective Lohman recalled a case in which a woman was planning a vacation, and found the perfect house in Big Bear online. She communicated virtually with the other party, who requested prepayment of $1,500. She paid the money, but when she went up to the house and knocked on the door, somebody answered, “saying my house isn’t for rent.”

How did this happen? Someone stole a photo of her house, posted it online and pretended like they were renting out the house, Detective Lohman said. Therefore, he advises, if you are looking for a rental, go to a reputable company.

“Go to real estate companies that you can verify whether this rental exists and is actually legit,” Detective Lohman emphasized.

» See Also: How to Avoid 4 Common Craigslist Rental Scams

Online Lottery and Sweepstakes Scams

People are still falling for the lottery scam, a crime that involves receiving an email from a foreign country, like Nigeria, stating you’ve won the lottery. However, “if you never been to Nigeria you’re not going to win the Nigerian lottery – not only that, foreign lotteries are illegal,” Detective Lohman warned.

Also, if you’re asked to pay money to get money, it’s a scam. “We know the lottery commission will tax the heck out of us, but they’re not going to take their money up front so they can send you $2.1 million,” Detective Lohman said.

He worked a case in which a man fell for this scam, gave everything away, and put up his house for sale because he truly believed that he won the lottery. Unfortunately, “these scammers did a number on this guy. And the sad part is I met with this guy. I said, ‘Sir you’re being scammed,’ and he said ‘no here’s the letter I received’.”

Detective Lohman inspected the letter, which was riddled with spelling and grammar errors; and in the end, “the courts had to get involved, his kids had to get involved, to save his remaining financial future, which was very minimal because he fell for this.”

In another scenario involving the sweepstakes scam, you might be walking through the mall, see a beautiful car, and fill out 100 entries to get your name drawn for the win. But what happens to the information you put into the box? “They sell it – it has your name and address and how much income you make,” said Detective Lohman, adding that this personal information is sold to other entities out there, “and they use it. So be careful.”

If you believe you’ve fallen victim to sweepstakes or lottery scam, file a complaint with the Better Business Bureau, go online to the Federal Trade Commission or call 877-FTC-HELP, or go online to the FBI’s Internet Crime Complaint Center.

Bottom Line: Look for These Red Flags

There are several red flags that could be signs of a scam:

  • Have you been contacted by telephone, email or text message by a stranger?
  • Have you been told you owe a payment, won a sweepstake, or have an unpaid bill?
  • Are you buying an item online with a price that is too good to be true?
  • Have you been hired to work at home or for a job without a face-to-face interview?

“If you answered yes to any of these, you might be getting scammed,” Detective Lohman said.

In Spiro’s advice, “it’s about slowing down – it’s about taking the time to understand not everybody is out there for your best interest, unfortunately, that’s where we’re at. Take the time to do your due diligence – just be careful.”

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Alicia Doyle

An award-winning journalist, Alicia Doyle has covered a range of topics, from crime to sports to special education. With an affinity for human interest stories, she has written thousands of articles about inspirational people, events and organizations that have a positive impact on the community and world at large.