The Thanksgiving and Christmas holidays are a time of celebration and cheer but the Federal Trade Commission cautions that certain groups, such as the elderly, are more vulnerable targets to scammers at this time of year.
Seniors often live alone, are less inclined to demand evidence or hang up, or have a nest egg that scammers are seeking to exploit. Scams occur by telephone, the mail, the internet, email or text, and door to door.
Advisors can help seniors become aware of the most common scams, including these 14 examples:
1. Discount Vacations and Timeshare Sales and Resales – You’ve been trying to get your parents to sell that timeshare for years and a call comes in offering to sell it for a lot of money due to the hot market, for just a $1,500 fee paid up front by credit card?
2. Free Trial Offers for Products – Try it free for 30 days, just give us your credit card number?
3. Disaster Relief from Fake Charitable Organizations – These are designed to pull on the heart strings and play on feelings of guilt. Fake funds have been solicited for Hurricane Matthew recovery; veterans or military; disabled children; orphans in third world countries; feeding the hungry; police and firefighters; and others – scammers take the funds and the charities never see a penny.
4. Family Member in an Emergency – here comes the telephone call from a grandchild who is stranded away from home and needs you to send money immediately and not tell mom…
5. IRS Calling – Are they looking for payment of taxes by telephone using a credit card? Guess what, the IRS does not call…
6. Lottery Winnings – Sure, they need bank account information to deposit your “winnings”…
7. Checks Arriving in the Mail – You deposit the unexpected check in your bank account and later it gets cleaned out..
8. Extended Car Warranty – Does the company offering this car warranty even exist?
9. Magazine Subscriptions – pay a fee and receive dozens of free magazines (fee for free?)
10. Medical and Prescription Plans – Discount programs masquerading as insurance programs…
11. Collection of a Debt or Past Due Bill – Supposedly your credit or your family member’s credit will be ruined if you don’t pay; do you know if there is even a debt? A big one is seniors paying their grandchild’s student loans – loans that don’t exist…
12. Work at Home – Stuffing envelopes or working on your computer; just send money to sign up and receive supplies to get started…
13. Companionship for Seniors – Individuals or services that take credit card numbers and get “gifts” from the senior without the senior’s family knowing about it…
14. Online Shopping – We’ll secure the gifts for your family and friends and even send them for you so you don’t have to brave the weather – just give us your credit card number…
As of February 2015, a consumer can report a telephone scam to the Federal Trade Commission by navigating to the FTC’s complaint website at FTCComplaintAssistant.gov. Consumers can report such scams as a person pretending to be a family member or friend, or those impersonating a government official.
Seniors may eventually realize that they have been taken advantage of, but because they don’t want to be seen as losing their ability to live independently, they may be reluctant to report it to a family member or the authorities.
As professionals and trusted financial advisors, it’s critical to be familiar with the various types of abuse and neglect, including scamming and its impact on at-risk older adults, and to discuss these risks with seniors and their families.
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