It seems that no one is immune from fraud and scams these days. With the ever-growing popularity of internet resources such as email, social media, online business, and dating sites, those over Age 70 and active on the internet may be especially vulnerable to digital con artists and crooks of the 21st century. So what can you do to protect yourself?
Common Cons and Scams
According to the AARP’s website, here are just a few of the many ways in which perpetrators victimize the elderly:
Identity Theft – One of the most common methods of fraud is identity theft. Stolen credit cards, social security and banking information makes this possible. Tell your loved ones to avoid providing sensitive information to a person or organization they do not know - or cannot readily verify (see “internet scams” below). Notify your credit card company immediately if your information is stolen or if you believe an unauthorized individual may have accessed your banking information.
Phone Scams/False Charities/False Solicitation – Seniors are more likely to own landline phones than their younger counterparts, and are therefore more likely to fall victim to fraudsters who cold call them at home. Fraudulent telemarketers may cold call and ask your loved one to give a donation to a fake organization. Never agree to make a donation by phone and give away personal financial information to an organization you don’t know. Tell them to mail you something or that you will call them back. Then, research the organization by contacting your local consumer protection agency or by looking them up on the Better Business Bureau website.
Health Insurance Fraud - This type of fraud occurs when equipment manufacturers advertise “free” products that are then charged to your insurance policy. In some cases the products are never even delivered to the purchaser, which is known as non-delivery fraud. Again, check the validity of the organization as noted above before you ever place an order, and call your insurance company to make sure this cost is covered. If the equipment provider is not approved by your health insurer, that is likely trouble!
Investment Schemes –Seniors should be wary of falling victim to pyramid schemes and letter fraud. One popular letter fraud scheme is known as the “Nigerian prince”, in which the perpetrator claims that the victim has won a cash settlement or gift and convinces the victim that the only way to receive the gift is to forward the perpetrator some amount of money to claim it. NEVER send money to an organization you don’t know, especially if they are promising a monetary reward in return. As we have often heard, “if it sounds to good to be true…..”
Exploitation and Threats – Family members and friends may pressure or threaten an elderly relative or acquaintance to give them money. Simple requests and pleas may turn to harassment, which is a crime. If you suspect your loved one is being pressured like this by someone they know, contact the Sarasota County Sherriff’s Seniors vs. Crime department by dialing (941) 474.9600.
Common Types of Internet Scams
Online fraud is so common and perpetrated by so many people, it’s hard for the authorities to respond to every instance of internet crime, so that’s why it’s even more important to protect your loved ones to not become victims to begin with! The first line of defense is awareness. Teach your loved one about these most common types of internet scams:
Phishing and email scams often involve these common tactics: the perpetrator sets up fake emails or websites that may appear familiar to the victim and asks them to enter their personal information, which may include their social security numbers, bank accounts, passwords and more. Every internet user must be wary of clicking on strange emails or websites, especially when asked to provide information that may be personally identifiable, or is related to your medical care or financial information. Make sure that the address you are being directed to is the same as the organization that you know and trust. And know that most reputable organizations – including banks and the IRS – will never solicit this kind of information via the internet.
Chat Rooms, Dating Sites and Social Media scams have been on the rise in the past few years and are specifically targeting seniors. Fraudsters are increasingly using the internet to hide or alter their digital identities to coax seniors into providing money or personal information. Internet users must be vigilant against any person who attempts to lure personal and financial information from them.
Pop-up ads are another common method that scammers utilize to target victims. An online advertisement may falsely inform the victim that a virus has infected their computer or that their computer is at risk. The user is then tricked into downloading malicious software that leaves their computer just as or even more vulnerable than before. The user may also be tricked into providing personal information to pay for fake software. Seniors are especially at risk because they may be unfamiliar with how to identify these suspicious ads. Best practice is to ignore these ads!
Non-Delivery is a scam in which the perpetrator accepts money from the victim for a purchase of an item and then fails to deliver the item to the purchaser. It is important to research and recognize the organization or person that your loved one orders from on the internet before giving any payment information.
What should I do if I discover a suspicious email?
Most websites include a security prompt that will allow you report suspected spam and attempts by perpetrators to steal your information. If you receive a suspicious email, do not open it. You should delete the email immediately and then permanently delete it from your trash.
Additional steps to protect yourself or loved ones
- Explain to your loved ones that saying “no” or refusing to offer personal information is usually the best course of action when solicited by an unrecognized source.
- Become familiar with your loved one’s normal spending behavior. Ask if you may acquire online access to their bank information so that you may monitor it for unusual or suspicious spending activity.
- If your loved ones are being harassed by unwanted sales calls or suspicious organizations consider un-listing their phone number or registering their phone number with the National Do Not Call Registry (https://www.donotcall.gov) operated by the Federal Trade Commission.
- Remove your address from mailing lists with the Direct Marketing Association and opt out of mailed advertisements. If mailed ads continue to arrive at your home, they are likely from scammers and should be reported to the U.S. Postal Service. Shred all credit card solicitations that come in the mail with your loved one’s information pre-printed on them.
- Become familiar with your loved one’s caregivers and research their backgrounds. The caregiver of you or your loved one should be someone you trust and have professional confidence in.
- Ensure that you and your loved ones have proper estate planning documents, including wills and powers of attorney to properly manage their affairs in accordance with their wishes. Their attorney should store original documents in a secured place. Copies should be stored in a safe place that is accessible by you or your family members.
- Make sure your loved ones discuss all major financial decisions with a trusted financial advisor before taking action.
- Rent a P.O. box and have all of your important legal and financial mailings go to it rather than a residential address where it can be stolen before your loved one retrieves it. Do not leave outgoing mail with personal information in it inside a mailbox to be picked up by the mail carrier. It’s likely a fraudster may get there first! Always drop outgoing mail in a USPS mailbox or take to the post office.
Who should I report suspected identity theft to?
If you believe that you or a loved one has had their identity information stolen, you should consider taking the following steps:
- Report your case to one of the three major credit reporting services: (Equifax, Experian, or TransUnion)
- Report your case directly to The Federal Trade Commission or The Social Security Administration.
- Report your case to the local police force, but the report must include an FTC affidavit of Identity Theft
- File a complaint directly with FBI or call the IRS Identity Protection Specialized Unit, toll-free at 1-800-908-4490 if you believe your identity information was stolen or misused.
How LPL Financial protects its clients
LPL Financial utilizes 256-bit encryption for all of its online data - the world standard - which to date has never fallen victim to a successful attack. LPL monitors potential system vulnerabilities. Updates and tests of its systems are performed regularly. Electronic correspondence such as email or other electronically-stored data that contains clients’ sensitive or personally identifiable information is encrypted using these same protections. In short, our clients can rest easy knowing that LPL Financial utilizes state-of-the-art security methods to store and secure your personal information and electronic data.
Additionally, LPL Financial now has a full-time Senior Investor & Advisor Compliance officer to act as a go-to resource specifically for elder client concerns. Clients who suspect some type of fraud against themselves or a loved one may contact us for support.
Visit the Financial Fraud Enforcement Task Force’s website for a number of resources you can use to report fraud and receive up to date information about common types of elder fraud.
Each year the IRS identifies the twelve most common scams and posts them to their website to spread awareness and to assist citizens with protecting themselves from what the IRS calls the “Dirty Dozen”.
The SEC has compiled an investment guide specifically for seniors, which further outlines scams that target the elderly and how to avoid them.
If you believe that you or an elderly family member have fallen victim to identity fraud or any of the scams mentioned above, you should not hesitate to inform the Sarasota County Sherriff’s Department Seniors vs. Crime department by calling (941) 474.9600.
The entire SRQ Wealth team takes the security of your information and that of your loved ones very seriously. Through our partnership with LPL Financial, we have the tools and resources available to keep our clients’ information safeguarded at all times with the highest level of sophistication. If you have any questions about the security of your financial information or would like a “security review” to help better protect yourself against financial fraud, please give us a call!