Scammers often target seniors because 1.) Many seniors have accumulated a considerable amount of money, and 2.) Seniors are often less up-to-date on current financial scams. So in an effort to educate, here are 5 of the most common financial scams seniors should watch out for.
1. Nigerian Prince / Lottery Scams
Several scams are based on the same basic idea-- you (the target) will receive a large sum of money, if you pay a small sum to unlock it. In the case of the Nigerian Prince or 419 scam, which believe it or not dates back to the 19th century, the scammer claims to be a Nigerian Prince or other wealthy foreigner who wants to move millions from his homeland to your country. If you help, you’ll be given a substantial portion. But at some point during the process the scammer will claim he needs a small sum of money from you in order to get his millions moved over successfully. If you’re a willing participant this may happen several times, until you catch on or run out of money and the scammer stops contacting you.
Lottery scams can be even trickier, as often the scammer will send you a check to deposit from a fake lottery you supposedly won. The scammer will then collect lottery fees or taxes from you, before the bank has a chance to reject the check as a fake.
2. Grandparent Scams
In this simple but effective scam, scammers will call and say something to the effect of “Hi Grandpa, do you know who this is?” If you guess the name of one of your grandchildren, then the scammer now has a fake identity he can use to call you and request money, claiming it’s for school supplies, rent, car repairs, or some other everyday expense. They’ll then ask you to send the money via Western Union, MoneyGram, or some other financial institution that doesn’t require the recipient to present ID in order to collect money.
3. Phishing Scams
Phishing scams can take place via email or over the phone. In this type of scam, the scammer claims to be from a legitimate company you interact with and contacts you saying they need to verify your personal information. If you give them your information, they’ll then use this to access your finances and/or steal your identity.
Common institutions the scammers claim to represent are the IRS or Medicare, as all Americans have to deal with the IRS and all Americans over 65 qualify for Medicare.
4. Funeral Scams
This particularly despicable scam targets grieving widows and widowers. In one version, the scammer will crash funerals claiming to be an old friend of the deceased who is owed money. In another version, the funeral home itself will take advantage of the widow’s unfamiliarity with funeral costs and tack on unnecessary charges, in the same way a disreputable auto mechanic might.
A common variation of this is the funeral director claiming a casket is needed even for direct cremation, which in reality can be accomplished just fine with a cardboard casket.
5. Counterfeit Drugs
Senior citizens represent a huge percentage of the prescription drug market. Legitimate versions of these drugs can be extremely expensive, so many seniors turn to the web to find the cheapest deals. This is a good idea, but must be done with extreme caution. The internet is full of low-priced counterfeit medications. Often, these counterfeit drugs are ineffective, and sometimes they’ll even inflict harm on the already sick user.
This scam includes “anti-aging” drugs such as Botox, as well as homeopathic remedies which may not do anything. So if you do buy medicine online, be sure to only get it from a reputable company.