5 Biggest Money Scams Targeting Seniors … And How To Avoid Them
As security breaches in Targets and Michael’s Arts & Crafts earlier this year have shown, anyone can fall victim to fraud and identity theft. Unfortunately, seniors are often an all-too-easy source for thieves. The Federal Trade Commission estimates that one in five seniors has been a victim of fraud. When it comes to telemarketer fraud, 56 to 80 percent of calls are directed at seniors.
What are some of the most common fraud schemes, and how can you or your loved ones avoid falling prey?
Medicare/Medicaid Fraud and Other Benefit Theft
Unscrupulous telemarketers phone seniors and ask them to confirm their social security number and Medicare or Medicaid account numbers. The telemarketers might say they are from a government agency and need the information to issue a new card, or they may say they are doing a corporate or government survey.
One of the more popular scams is to say they need this information in order to provide seniors with a medical alert system or other home health care equipment. They might convince the senior it was ordered by a loved one, or tell them it’s being given away free.
With the information, the scammers will either sell the information to others, who use it to receive medical care under a fraudulent identity, or use it themselves in this way.
To avoid this scam, do not give your social security number, Medicare or Medicaid card numbers to anyone over the phone.
In most cases, you don’t even need to share your social security number at the doctor’s office, although you do have to provide your insurance, Medicare or Medicaid identification numbers.
Tax Refund Scams
Some elderly people don’t make enough money to have to file a tax return. However, scammers will obtain a senior’s social security number, often through a fraudulent telemarketer call saying they are “verifying information” or offering a prize giveaway. With the senior’s social security number, they file a return in the senior’s name, claiming refunds that aren’t even theirs.
In other cases, con artists will call or visit seniors in a door-to-door sales call and convince them that they are entitled to a tax refund. Then, they charge seniors money to file the return for them and disappear with their money.
Beware of anyone who says you can earn a tax refund from a program that’s already expired. If they mention “little known tax benefits,” call a tax accountant you can trust and ask if you might be owed money. Then let that reputable accountant help you file your return. Again, do not provide your social security number, required to file a tax return, to anyone you don’t know.
It is true that you may be entitled to tax refunds you didn’t know about, and if you are owed money, you can file a return for up to three years after that tax year. But remember, reputable tax accountants don’t go door-to-door to get clients.
Sweepstakes or Prizes
A senior may receive a phone call saying they’ve won a sweepstakes, a vacation getaway or a cruise. But to obtain the prize, they must provide sensitive information including their social security number and even a credit card number.
While a handful of companies that give away cruises or airfare and hotel stays are legitimate, most times they are looking to sell time shares or vacation homes.
In other cases, these companies are complete fakes and will use the information obtained to make fraudulent charges on your credit card. You will never receive the cruise or airline tickets promised. It’s not worth taking chances.
Many times, door-to-door salespeople or telemarketers will convince seniors to invest in anything from foreign money to oil or gas investments. The swindler will walk away with your money, leaving you wondering what happened.
Sometimes seniors have a lot of money to invest and are confused by the options available. Stay savvy about your money by speaking to a reputable financial advisor who comes highly recommended in reviews and through word-of-mouth. Avoid any so-called investment counselors who employ a hard sell or pressure you to make a decision and give them money immediately. If family members or loved ones are saying an investment deal feels wrong, reconsider.
Robocalls are used in a number of ways to collect information such as social security or Medicare ID numbers to pull off any of the scams listed above. Recently, a Florida company scammed $13 million from seniors by getting them to pay for a medical alert device. If the phone rings, you pick up and there is no one there immediately, or it is a recorded message, hang up.
Rely On Others
Sadly, this list just scratches the surface of how scammers try to separate seniors from their retirement savings. As we age, our instincts and ability to recognize con artists may diminish. Rely on the judgement of trusted family members, never provide personal information to anyone over the phone, and you’ll be able to protect your financial interests for life.
SeniorLiving.Net is a free service for families to use that are looking for senior care or senior living for a loved one. Call (866) 662-0435 to speak to your local Care Advisor about senior care providers in your local area.