As the year comes to a close, news outlets have begun coming out with “top 10” lists. Most of the time these lists are fun. The “top 10 songs” and “top 10 books” of the year may make you smile or give you an idea to listen to or read something new.
But the Federal Trade Commission recently released a list that, while not great news, will help you protect yourself — the top 10 senior fraud scams.
The data is actually based on data collected from surveys in 2019, so it’s not quite a “top 10 list of 2020,” but we’ve seen these scams popping up this year as well. The good news is, with the right knowledge, you can protect yourself from these fraudsters. To help you, we’ll explain what each scam is, what to look out for and how to protect yourself.
1. Romance Scams ($84 million lost)
Seniors lost more money to romance scams than any other one — by far. These are particularly cruel, as bad actors typically prey on seniors’ loneliness and kindness. They build trust in messaging apps like Facebook or Instagram, often claiming they are in the military, working on an oil rig or a doctor with an international organization. They’ll ask for money or gift cards to pay for things like medical expenses, travel or visas.
2. Government Imposter ($61 million lost)
Cons posing as members of the Social Security Administration rose 30 percent from 2018 to 2019. Government imposter scams haven’t slowed down in 2020, thanks in part to COVID-19. Fraudsters used the confusion over stimulus checks, pretended to be members of the IRS and stole people’s private information, such as their social security and bank account numbers and money. Advances in technology, such as robocalls and Voice over Internet Protocol phone services, have enabled this type of fraud, the FTC report says.
3. Prizes/Sweepstakes/Lottery ($51 million lost)
It would be great to win a large sum of money or expensive jewelry after not even entering a contest, but these scams are proof that if something sounds too good to be true, it often is. Prize/sweepstakes/lottery scams often start with something exciting (“You won $1 million!”), but there are typically strings attached, such as the need to pay money to receive the prize. These scams particularly affect older seniors — people 80 and over lost about $22 million of the $51 million lost.
4. Business Imposter ($34 million lost)
These scams often happen over email, when bad actors can create email addresses that look like they are coming from your business (this is known as spoofing). They may ask for your password, bank account number or money.
5. Investment Scams ($25 million lost)
These schemes come in a variety of forms. You may receive a cold call from someone masquerading as a stockbroker and offering to give you investment advice or an email offering a low or no-risk investment or guaranteed returns. Ponzi schemes also fall under this category.
6. Tech Support ($24 million lost)
Cons know seniors often aren’t the most technologically-savvy, so they target them for these types of scams. Red flags for these include someone reaching out swearing you have a virus (even if nothing seems wrong with your computer) and trying to convince you to pay money to fix it.
7. Timeshare Sales ($17 million lost)
Making a great escape may sound like a good idea, but if you get a call out of the blue from someone selling a timeshare, proceed with caution. Often, these offers and schemes come with fine print, like hidden fees, and the timeshare often doesn’t exist at all — meaning people pay a whole lot of money for nothing.
8. Family/Friend Imposter ($17 million lost)
Seniors often have big hearts and the desire to help their family and friends. Scammers know this and will pose as a grandchild, long-lost friend or child and ask for expensive favors, such as the immediate wiring of large sums of money. Though this report is from 2019, these scams are unfortunately alive and well in 2020, as cons capitalized on the economic and health crisis and manipulated seniors.
9. Online Shopping ($14 million lost)
Online shopping has made it easier to get what you want when you want it, but it’s also opened the door for more scams. These schemes often ask people to pay via money order or a wire transfer. (Note: Reputable e-commerce sites are fine with a credit or debit card.)
10. Timeshare Resales ($13 million lost)
If someone offers to help you sell for your part-time vacation home, be wary. Scammers may seem to have legitimate credentials and documents, but they’ll ask for your credit card number or for you to make a wire transfer and often drain your account. What’s more, they never close the deal.
Here’s how you can protect yourself:
- Only accept friend, follow and message requests from people you know on social media.
- Remember: Government agencies will not ask for your social security number, password or bank account number.
- Use two-factor email authentication to make it more difficult for hackers to use your personal information.
- Change passwords regularly.
- Pay for products online using a credit or debit card.
- Use investor.gov to research anyone reaching out with an investment opportunity.
- Research businesses, charities and people asking to sell your timeshare. The Better Business Bureau has resources.
- Personally call friends or family if you receive a call or email on their behalf.
Report any instances of fraud to the FTC. It will prevent you from being hassled again as well as others from getting scammed.