Aging is a fact of life. And while it may be endearing, or even funny when grandma calls you by three different names before she gets to yours, it's no joke when a scammer tries to take advantage of her for financial gain.
Elderly Americans have always been an easy target for impostor scams, partly because they’re not as tech-savvy as younger generations, but also because they have more money.
Older adults hold the majority of the wealth in the U.S., says Amy Nofziger, director of fraud victim support for the AARP Fraud Watch Network. “So, just like with bank robberies, the scammers go where the money is,” she says.
Last year, the Federal Trade Commission received 2.1 million fraud reports, costing consumers over $3.3 billion in losses, up from $1.89 billion in 2019. Identity theft and impostor scams alone accounted for nearly 500,000 of those reports, making them the most common types of fraud in 2020.
As COVID-19 quarantines and social distancing measures stretch into 2021—isolating elderly people from loved ones who are better informed on the dangers of these types of scams—millions of Americans are more vulnerable than ever.
What Are Impostor Scams?
“Impostor scams” refer to all the fraudsters who try to contact you pretending to be someone they’re not; whether that’s a government agency, business, or a member of your own family. Most often, the goal of the scam is to steal your money, although they can also be after personal information that can lead to identity theft.
An impostor can contact your family member by phone, text or email, and they’re good at what they do. What’s more, they’re not above playing on emotions or using scare tactics to achieve their goals: They can pose as a family member in distress, a government official threatening legal action, or even the love of grandma’s life.
Another big part of impostor scams is pressuring their victim for immediate cash through an untraceable form of payment such as a prepaid gift card, wire transfer, or a payment app like Venmo. Using these types of payments make it very hard, if not impossible, to track the scammer or recover the money.
4 Common Scams Targeting the Elderly
The best way to deal with any type of scam is to recognize them before any damage is done. According to the AARP’s Fraud Watch Network, people who are aware of a specific scam are 80% less likely to engage with a scammer and, if they do engage, they are 40% less likely to become a victim.
This means it is absolutely crucial to have a serious conversation with your older friends and relatives about the different types of scams and how to recognize them. Here are the four big ones.
The IRS Agency Scam
The hustle. Now that tax season is here, phony Internal Revenue Service (IRS) agents are dusting off their old bag of tricks. Usually, the scammer will claim there’s an unpaid tax bill due and immediate payment is required, threatening to have the victim arrested if payment isn’t made. Then they’ll demand payment via a prepaid gift card or wire transfer.
This happens with Social Security numbers too: Every year, a swarm of fraudsters dials up elderly Americans, tells them their account has been suspended, and asks them to provide personal information or pay a fee to resolve the issue.
Red flags. The first tip-off is that the IRS will not call, text, or email anyone about a tax debt. Period. All communications from the IRS are done by mail (same goes for the Social Security Administration).
The IRS also won’t threaten to have anyone arrested or require immediate payment through a wire transfer or prepaid card. If your family member owes a legitimate debt, they’ll receive written notification and have the opportunity to either contest the debt or work out a payment plan.
The hustle. In this swindle, the impostor will pretend to be looking for a love connection on a dating website — often one that caters to seniors, like OurTime. Once that connection is established, they’ll claim they’re short on money, ask for a loan, or even a joint bank account. Once the victim is milked for all she’s worth, the so-called love connection disappears.
Red flags: Like every other scam on this list, if your loved one is asked to send money through a wire transfer, prepaid card or other quick payment methods to someone they’ve never met in person, it’s almost certainly a scam.
The COVID Vaccine Scam
The hustle. The impostor will call, text, or email grandma or grandpa offering to place them on the vaccine list, or give them early access to the vaccine for a fee.
Vaccine scammers usually want money, often in the form of one of those prepaid gift cards, but they’re sometimes in the market for personal information like social security numbers.
Red flags: The COVID vaccines are free, as is making an appointment to get vaccinated. Anyone asking for payment, or any sort of personal or banking information, is a scammer.
The Grandson Scam
The hustle. Grandma will receive a phone call, text or email from someone posing as a loved one—grandchild, daughter, friend—claiming they have an emergency. Whether they’re having car trouble, or are at the hospital, it’s always a dire situation. And they need money fast.
Red Flags: Aside from the red flags we’ve already talked about (i.e., asking for money via a gift card), these scams can often be identified by the urgency of the request. If the person on the other end of the line asks the victim not to contact anyone else, like a parent who could verify the alleged emergency, it’s probably a scam.
How to Protect Older Relatives from Fraud
The best way to protect your loved ones is to talk with them about different scams and how they should handle them before they ever get a call.
Nofziger recommends role-playing: Ask your family member if they’ve heard of the scams listed here, and how they would react if they received a phone call or email asking for money or private information. Then go over how they should respond. Tell them to immediately hang up on callers asking for payment or threatening legal action, and to not click on links in any texts or emails which demand payment or request personal information.
It could be worth leaving Post-It notes by your loved one’s phone or computer with a script they can read off if they’re ever in doubt. Let them know that if they do receive any type of communication asking for money, they can call you first to make sure it’s not a scam.
You can also program smartphones to send unknown calls straight to voicemail, reducing the chance of a scammer getting through. In any case, add profile pictures to your family member’s smartphone so they can instantly recognize a legitimate call from a legitimate number.
What to Do If Grandma Falls for a Scam
Keep in mind that once your loved one realizes they’ve been scammed, they’ll probably be embarrassed. Don’t react in anger or frustration — you want the lines of communication to stay open so you can better protect your family member in the future, Nofziger says.
If your loved one has already sent money through a prepaid gift card or an app like Venmo, that money is likely gone for good. All the same, they’ll want to contact their bank and credit card carriers to make sure no additional financial information has been stolen. Next, help them put a credit freeze and fraud alert on their credit reports.
It’s also important to report the scam to your local police, state attorney general’s office, and a government agency like the Federal Trade Commission (FTC) or the IRS. This helps track and stop scammers from hurting other victims.