Older adults are increasingly vulnerable to financial fraud, often suffering significant losses they cannot recover from. Fraudsters exploit gaps in existing laws and leverage modern technology like the internet, email, and social media to target seniors. Unlike past decades when scams were limited to mail and phone calls, today’s digital landscape enables criminal organizations to defraud older adults more easily. The financial and emotional toll on seniors is devastating, with fraud growing rapidly through online and phone transactions.
Legislative Efforts to Protect Seniors from Financial Exploitation
A pending Bill, the Financial Exploitation Prevention Act of 2023, aims to combat the financial exploitation of older adults. This legislation allows investment companies to delay releasing funds for up to 25 days if they suspect an investor aged 65 or older is being exploited. State regulators, courts, and administrative agencies can extend this delay if necessary.
Currently awaiting Senate approval, this bill addresses losses that cost the aging population about $3 billion annually, with average individual losses reaching $120,000. Seniors facing cognitive challenges are especially at risk, and, unfortunately, family members often cause more harm than strangers.
Financial Fraud Against Seniors: A Widespread Problem
In 2020, the US Department of Justice (DOJ) conducted the largest nationwide elder fraud sweep, identifying over 260 defendants involved in fraud schemes that primarily targeted seniors. These operations spanned every federal district, resulting in over $750 million in alleged fraud.
One tragic case involved an 83-year-old woman whose caregiver stole her life savings, leaving her unable to afford retirement home bills and ultimately leading to her death.
Common Types of Senior Financial Scams
| Scam Type | Description |
|---|---|
| Fake Drug Discount Cards | Fraudulent cards promising reduced prescription costs to gain personal information. |
| Remote Computer Access Scams | Scammers posing as tech support to gain remote access and steal data. |
| Grandparent Scams | Impersonating relatives in financial distress to solicit emergency money. |
| Fake Insurance Fees | Charging fees for non-existent sweepstakes or prize collection. |
| Mass Mailings | Sending fraudulent offers or solicitations through postal mail. |
| Money Mule Fraud | Recruiting individuals to transfer illegally obtained money unknowingly. |
| Fraudulent Debt Collectors | Posing as debt collectors to intimidate victims into paying fake debts. |
International Cooperation Against Elder Fraud
The DOJ’s Office of International Affairs collaborates with global partners—including agencies in Belgium, Canada, Europol, the Netherlands, Norway, Spain, and the United Kingdom—to share intelligence and pursue extraditions of international fraudsters targeting seniors. This cooperative effort enhances protection of elderly residents across member countries.
How Seniors and Families Can Protect Themselves
Education is the most effective defense against financial scams. Fraudsters often provoke strong emotions like excitement or fear to pressure victims into hasty decisions. Seniors should wait 24 hours before making any financial commitments and be cautious of high-pressure tactics.
To safeguard personal information and finances, seniors should:
- Never share personal or financial details with unknown contacts.
- Ask for credentials and verify identities.
- Consult supervisors or authorities when in doubt.
- Involve trusted family members or financial advisors in large transactions.
- Regularly review bank accounts for unusual deductions or small test withdrawals.
Resources for Reporting and Support
Consumers can report elder fraud to the Federal Trade Commission (FTC) online or by calling 877-FTC-HELP. The DOJ’s Office of Victims of Crime offers additional resources and support for elder fraud victims.
Working with a trusted elder law attorney experienced in senior fraud and abuse is crucial for protecting financial security and navigating recovery options.
We hope you found this article helpful. If you’d like to discuss your particular situation, please contact our Sherwood or Searcy office at 501-834-2070 to schedule a consultation. We look forward to the opportunity to work with you.