A friend of mine received a call from an unfamiliar number. When she asked who it was, the caller replied, “Your grandson.” After hesitating a second or two, my friend said, “You must have the wrong number” and hung up. It was only later that she remembered an article about scammers who use this ruse to extract money from seniors, and was amazed that she could have considered the call legitimate even briefly.
When we hear about outrageous scams, we wonder, “How could they have fallen for that?” But people do, even some of the most intelligent among us. With Consumer Reports’ recent cover story on the topic of senior scams, I thought it would be a good time to review this important and timely topic.
Seniors lose billions of dollars each year to con-artists. In reality, so do non-seniors, but seniors are the most pitiful victims, simply because they are often more vulnerable. They tend to be less suspicious and more isolated and lonely – and they have money in the bank. Moreover, seniors want to be independent and handle their own affairs. It is demeaning to have to ask their children for assistance in navigating normal aspects of life. This mindset sets them up to be victims.
But, lest you think you are safe because you are under 65, know that what I describe here pertains to all people. In the criminal mind, extracting money from people over the phone is far easier than robbing a bank at gunpoint.
Imaginative Scams
In a twist on the introductory anecdote, a grandmother gets a phone call saying that her grandson is in jail in South America. The caller is the grandson’s “lawyer,” who explains that cash is needed or the young man will be in big trouble. Grandma follows his instructions and goes to a CVS to buy money cards. These cards are purchased and are great for transferring money without leaving a trail. You just scratch off the coating and read the digits to someone over the phone. Within five days, the unfortunate woman had transferred $65,000 – all the money she had – to the unscrupulous gang.
Other common ploys are contractors who charge inflated prices and fraudsters who became friends with seniors and then talk them out of their money. In one case, an 86-year-old widow was informed that she had won $19 million in a lottery but had to wire $3,500. When the crooks received that money, she was marked as an easy target, and became victim to other scams. In less then a year she had lost $297,000! She lost everything. Sometimes, seniors will even borrow money in order to send it in these fake callers.
Other swindling schemes include fake overseas lotteries and the now-famous IRS scam. In that one, an “IRS employee” calls and tells you that you are in trouble regarding back taxes. If you do not pay up right now, you are going to jail today! A young man in Lakewood fell for that one!
In addition to outright scams, there exists a range of “quasi-crimes” against seniors. One of them is the annuity business, where salespersons recommend to seniors that they put all their money into an annuity. Annuities are complex entities. To determine if an annuity is appropriate and beneficial to a specific individual, it requires the advice of an impartial financial professional who does not stand to profit from this transaction. A financial “advisor” who sells an inappropriate investment is little more than a used car salesman making money off the sale to the detriment of the purchaser.
Clever Tricks
How do the criminals get hold of your information? One way is to send a mass mailing offering a “free” gift or prize. If you respond, they ask for your information. If you revealed it, you have gotten yourself onto a sucker list. Then the telephone calls start. The callers know how to be friendly and learn about the senior’s family and interests. If you send a check for any small amount, it will reveal your bank account information. Seniors might even be persuaded to reveal their social security number, which helps the crooks get into their accounts and steal more money
In one scam, the senior changed her phone number, so the scammer called a plumber and said that his “elderly mother” needed his services. When the plumber, who was not in on the plot, arrived, the old lady said, “But I didn’t call you.” The plumber, who had been told that to call the scammer from her house, asked to use the phone to get further instructions. When the plumber called, the new number was revealed to the scammer via caller ID. Wow!!
I think that adult children should tell their senior relative to ask for the caller’s name and phone number and tell them that someone would get back to them. Then have a savvy child return the call.
The FBI has a great website with a whole section just for seniors. It discusses frauds regarding healthcare (you need to review benefits statements), counterfeit prescriptions, funeral prepayment, reverse mortgage, and endless telemarketing tricks. Some advice from the FBI is to beware of the following:
- You win something and have to send money to get your “free” gift.
- You must act immediately to benefit from this deal.
- You must pay in advance for services.
- You feel pressured.
- You are told you have to pay a tax for the gift.
- The caller is aware that you have been victimized in the past.
It has even happened that scammers have pretended to be the FBI investigating the original scam! What chutzpa!
Protecting Seniors
Warning seniors is important but not sufficient. They are no match for the scammers, and cannot be relied upon to detect whether a call is legitimate. In my opinion, seniors’ adult children or another caring adult should be monitoring their finances. I cannot think of any other defense against such scams. This means someone has to check what money is leaving their bank account. This can be done very easily online, so that the monitor can live in a different city or even in Israel.
The monitor should pay all bills online; there is no need to write checks for recurring charges, like telephone and utilities. The senior can have access to a different bank account with limited funds for cash purchases. Better yet, just give the senior a certain amount of cash each week for expenses, such as groceries. Of course, groceries can be bought with credit cards and, here in Baltimore, with the “penguin card,” a prepaid credit card that has replaced Bais Yaakov's Kinderkash. It can be used in most frum stores, and you can see every purchase online.
Here are some other practical suggestions from Consumer Reports:
- Register at nomorobo.com. This should stop junk phone calls. Also go to donotcall.gov, which stops legitimate telemarketers.
- Sign up for online banking, with an adult child paying all bills.
- Discuss with an attorney the executing of a proper will, which should include awarding a POA, power of attorney (very important!) to an adult child or other responsible party. Major financial institutions should be informed of the power of attorney, as they will not deal with you otherwise. Social Security has its own application for POA that needs to be filed with them.
- Make sure that valuables in the house are properly hidden. Be suspicious of contractors and cleaning help. The adult child needs to approve of anyone who enters the house.
- In extreme cases, if a senior is incompetent, the children can file for guardianship. This means that the child is in legally charge over the senior, and generally requires a medical evaluation.
An Out-of-the Box Idea
I’ve been toying with a novel idea. Why not recruit some volunteers to call seniors and tell them they won millions in a lottery, or that a grandchild is in jail in a faraway land. Then ask them for their address, social security number, bank account number, date of birth, etc., to see if they will provide the information. If the senior takes them seriously, we know that grandpa/grandma needs assistance. This is like the experiments to see if children will walk off with a stranger. Anyone have time for this great project? Maybe Jewish Family Services can work on this one. I imagine there would be some government grant money that could be used for such an effort.
Getting the Right Advice
I am not trying to scare people more then necessary. I buy many things online and on eBay. It generally goes fine. Uber and Airbnb have shown us that people can get into cars with strangers and go to sleep in a stranger’s house (wow!) and everything is okay more than 99 percent of the time. We are all familiar with numerous legitimate charities. This article is just addressing the few bad apples in the bin.
If you spot senior fraud, tell the children or someone else who can help. While there is a push for stronger laws, it is best to stop fraud before it happens. One way is simply to proceed with caution and get advice from an expert. I am constantly amazed when adults of all ages do things on their own without consulting anyone. People think that getting advice is a sign of weakness. They want to be able to say, “Look, Ma, no hands.” I can do it on my own. That is an understandable but dangerous attitude. When dealing with complicated situations, it is important to have a mentor. As they say: Two heads are better then one. Never make serious decisions on your own.
So, let’s keep an eye on the old folks, and let’s get the word out that the sign of a wise person is someone who gets – and takes – advice. No major decisions can be made in a vacuum. As the cliché goes, an ounce of prevention is worth a pound of cure.
Eli Pollock can be reached at elipollock2@yahoo.com.
