Natural catastrophes are bad enough, but we live in an age of chaos and must add another prevalent disaster—financial exploitation, especially of the elderly.
Every year Americans lose billions of dollars to fraudulent scams and investments. The following provides information for avoiding fraudulent schemes, but the list is not exhaustive.
Six Common Ways the Elderly are Bilked
- Charity fraud
Millions of bighearted Americans give to reputable ministries and charities. The devastating hurricane season of 2005 proves that. Unfortunately, it also revealed predators who solicited funds for disreputable or fraudulent charities.
Most police and fire departments are tax-supported, but it's not uncommon for some to ask for contributions. Yet, just because the words "police" or "firefighter" are used doesn't mean that public servants are involved.
Call your local police or fire department to verify fundraiser claims. Even with legitimate appeals, often fundraising groups receive a small percentage of what is raised, and the fund raiser pockets most of the money as fees.
There's no reason to be suspicious of all fund raising. But, before donating, ask how your money will be used and what percentage goes to the local organization. Be sure your money supports activities that are important to you.
Phishing—pronounced just like the "fishing" some of us do legitimately—is a common way for con artists to gather your personal information.
You receive an official looking e-mail. Some criminals cut and paste logos from banks or other financial institutions and create what appears to be a legitimate document from that institution.
They'll have seemingly legitimate reasons for asking you to update or validate your billing information, including credit card and Social Security numbers You're asked to send the information using a website address that they've inserted in the e-mail.
Unfortunately, if you send the information and try to contact them later, you'll discover that the site has disappeared. They have "phished" and you took the bait.
- Work at home
A few work-at-home offers might produce minimal income, but don't count on it because you'll be unable to determine which ones are valid. The vast majority fraudulently promise large payouts for little work. "Hurry, thousands of people across America use my system for extra income. Working online in her spare time, Ruth made $470 cash in three days, $2,500 the first month."
Usually, you're asked to pay for upfront supplies, training, an instructional manual or materials—charges you'll rarely recoup.
- Foreign money offers
Someone supposedly has inherited a large amount of money and contacts you—or a "foreign government official" sends you an e-mail or letter—many from African nations, but could originate anywhere.
The "inheritance" cannot be taken from the country because the amount is too large. You're asked to help by allowing some of the money to be transferred to your bank account.
Or, the "foreign official" is out of political favor, or a pressing health issue requires him to get money out of the country himself, so he needs to transfer it to an American bank.
This will be done at great risk to himself in his country, but he trusts you, you'll be rewarded generously and you're assured that it's a perfectly legitimate for you.
Naturally, you'll need to send your bank account information in order to make the money transfer—and time is always of the essence. Warning: don't just slow down—stop!
Even though legitimate sweepstakes are conducted by major corporations such as Coca-Cola and Chevrolet, fraudulent sweepstakes scams bilk thousands every year.
You're informed that you've won something—either by phone or by mail and you'll only need to pay a processing fee, taxes and handling and delivery costs.
To give the scam an air of legitimacy, you may even receive a portion of your prize as a counterfeit check along with the phony winner notification.
However, if you cash the fraudulent check, you're committing a crime and you could be liable for fines—not to mention losing any money you send to them.
- Internet auctions
Thousands of legitimate transactions take place daily on popular online auction sties, but sometimes goods purchased from dishonest individuals never arrive or aren't what's been promised.
And, "phishing" predators send e-mails saying something like: "My payment wasn't accepted by your bank. But, I want to make this transaction right, so please resend your bank's number and your bank account information to me, and I'll resubmit a check to you."
You're asked to send information to a fake website address. This scam is so prevalent that online auction companies have departments to battle this type of fraud.
How Friends or Relatives Can Help
Discuss these matters with your relatives and friends—elderly or not. Let them know that criminals can obtain personal data without ever breaking into our homes. Warn and instruct them about:
- Shoulder surfers watch you punch in your phone calling card or credit card number or listen to you give your credit card number over the phone.
- Dumpster divers go through trash cans or dumpsters for checks and credit card and bank statements. Records containing your name, address and phone number help criminals steal your identity.
- Destroy discarded "pre-approval" credit card applications received in the mail. If you don't, your personal information can be activated for criminal use. Buy an paper shredder.
- Internet thieves want your I.D., data, passwords and banking information. Don't respond to "spam"—unsolicited e-mails that promise some benefit if you'll provide identifying data.
Victims of identity fraud often are unaware of what's happening until their credit and reputation are damaged, or assets are stolen.
So check your credit report regularly. You can order your free annual credit report online at http://www.ftc.gov/bcp/edu/microsites/freereports/index.shtml, or call 1-877-322-8228.
Cautions to Help Counter the Problem
- Don't reply to anything that doesn't provide enough specific information, requires an entry fee or deposit, asks you respond to a website, or to dial a telephone number
- By no means respond to anyone asking for Social Security, credit card, bank information or requiring you to pay taxes directly to them.
- Banks, financial institutions or government agencies will never contact you asking you to confirm personal information by e-mail or over the phone.
- Financial institutions have their own websites. So, don't respond to Yahoo, Excite or Hotmail e-mail accounts, these are free—and bogus. Even so, hi-tech scammers can create fake websites that look real. The point is, not all websites are legitimate.
- Never mail checks or anything containing your personal or financial information from your mail box. Instead, drop it off at the post office.
- When e-mails contain poor grammar and misspelled words, look out!
- If it sounds too good to be true—you're right—it is.
If your suspect that you've been an identity theft or fraud victim, report it immediately to your local office of the FBI or the U.S. Secret Service, and online at the Federal Trade Commission's Bureau of Consumer Protection at http://www.ftc.gov*.