Elder Fraud—Mounting Your Best Defense

Eden and Mark (last names withheld) lost their whole life savings to a con artist a year ago. "We lost every penny we earned from our business. The savings we had amassed over the course of our 38 years of marriage were all snatched from us”, Eden told California news outlets.
It's tragic and terrifying, but what just happened? Eden's computer urgently displayed a pop-up warning about a virus and instructed her to call "Microsoft." She was informed that her PC had a "terrible problem" when she called the number.
The man who answered the phone, who was not from Microsoft, advised her to transfer her money to secure government accounts because the issue was related to identity theft.
She obliged, sending thieves $564,000 in five wire transfers.
It can be tempting to criticize these events after they have happened, but con artists are skilled at coming across as sincere, reliable, and convincing.  Very smart people have been swindled and lost significant amounts of money.
Know and understand their methods
It's important to be aware of the primary scams that are currently being used to defraud elders.  Understand these methods in order to protect yourself and your loved ones:

1. Investment: these scams promise quick riches and put pressure on the elderly to access their financial accounts. 
   
   
2. Lottery/sweepstakes: remember to always verify the legitimacy of claims of winning prizes before providing personal information or sending money.
   
3. Romance: the person behind the scam creates a fake profile to win over the victim's trust and affection. It's important to be cautious and stay alert when talking to people online, especially if they ask for personal information or money.
   
4. IRS, Social Security, or Medicare: these organizations never make unsolicited phone calls. If you are concerned, look at a statement to find a legitimate phone number to call.
   
5. Grandparent scam: A scammer calls and pretends to be a grandchild. They'll say something like, "Hi, Grandma. Do you know who this is?" and when the grandparent guesses the name of the grandchild the scammer most sounds like, they'll use that to gain their trust. Then, the fraudster will ask for money to solve some urgent financial problem like overdue rent, car repairs, or an emergency at the hospital. 
   

There are steps we can take to fight back and keep ourselves and our loved ones safe.

1. Designate a trusted contact. This person has no authority over your brokerage accounts to access money, but according to the SEC “... may help your brokerage firm respond to possible financial exploitation or fraud in your account and protect your account’s assets. “
   
2. Be very wary of unknown phone numbers. If you don’t recognize the number, be wary of who is calling.  In fact, consider not even answering a call or text unless it is from a named contact in your phone.
   
3. Freeze your credit report with the three major credit rating agencies at no cost. This helps prevent accounts from being opened in your name without your knowledge. When the need arises, you can temporarily remove the freeze.
   

As you can see, there is plenty to be aware of.  If a request seems unusual, that should be a red flag.  It may turn out to be legitimate.  But if not, as Ben Franklin was fond of saying, an ounce of prevention is worth a pound of cure.