Protect your identity and safeguard your wealth from scams
Each year, countless people fall victim to cunning scammers looking for any opportunity to steal someone else’s money. In particular, many of these scams target older adults who are especially vulnerable to this deception. In 2023 alone, the FBI reported that older adults lost $3.4 billion to scams (Source). This statistic, of course, includes only those scams that were reported at all. A vast majority go unreported, meaning that a great deal of older adults lose their money to increasingly intricate scams each year. Our goal is to provide the information and resources needed to protect your identity and safeguard your wealth. Thus, it’s important to acknowledge the prevalence of these scams, the types that exist, why older adults are more susceptible, and best practices to avoid fraudulent activity.
Be on alert for these types of scams
As the digital world progresses, there is a plethora of potential scams that older adults and other vulnerable people fall victim to. These can include but are not limited to…
- AI Scams – Scammers program AI to mimic the voice of someone you know and leave a voicemail requesting money.
- Government impersonation scams – Scammers pose as agents of the IRS, Social Security Administration, or Medicare and demand payment on “unpaid taxes” with threat of arrest or deportation.
- Sweepstakes and lottery scams – Scammers reach out to let you know you’ve won a lottery or prize and to claim your winnings, you’ll need to send in a certain amount to cover taxes and other processing fees.
- Robocalls/ phone scams – Scammers call and feign a bad connection by asking, “Can you hear me?” or “Are you there?” so that they can record you saying, “Yes.” They will then use your voice signature to authorize charges on stolen credit cards, hacked accounts, etc.
- Grandparent scams – Scammers tug at your heartstrings by posing as a loved one and requesting money for an urgent financial problem that does not exist, all while begging you not to tell anyone for fear of embarrassment.
- Romance scams – Scammers create elaborate online personas on dating apps and websites to exploit your loneliness. They win your trust, romance you, and then request large sums of money so they can “travel overseas and meet you in person.”
- Sextortion – Scammers photoshop your face on pictures with nudity and use it as blackmail.
- Pig-butchering scams – Scammers offer investment opportunities with higher returns at lower interest rates. They may reach out to you with a fake online persona to befriend you and gain your trust. Then, they might present an investment that feels too good to be true. They may even show statements as “proof” of returns, goading you into putting a little bit of your money into a fake account over a period of time, until you put a large sum in. Following this, the scammer will make a vanishing act with your money, i.e. butchering the pig.
Why are older adults more susceptible to scams?
Scams often target people whose life circumstances make them more vulnerable and likely not to report a scam because they either don’t know it’s happened or they’re ashamed to admit when it has. Older adults, in particular, are disproportionately impacted because they often have wealth they’ve accumulated over the course of their lifetimes, making them an ideal target for scams. Criminals also target older adults who:
- Live alone or are isolated for increased periods of time
- Have less formal education
- Are not married
- Have financial challenges
- Have a physical illness that may impair their cognitive abilities
- Have a mental health illness, such as depression or anxiety
- Do not have a financial advisor
What can you do to avoid these scams?
Aside from being aware of sketchy messages, verifying the source of a potential scam, and being on the lookout for fishy URLs, there are some critical steps you can take to avoid scams:
1. Consult a Professional
Ed Slott, an Elite IRA Advisor, states that if you ever receive a phone call that sounds fishy or too good to be true, always say, “Let me run that by my accountant or financial advisor.” If the caller discourages that, it might not be legitimate. They might try to sway you with comments like, “If other people know about this, they’re going to want in.” Whenever someone creates a sense of urgency around a major financial endeavor, this should be a glaring red flag. Always consult a professional before jumping into any financial decision.
2. Complete a Trusted Contact Form
Completing a Trusted Contact Form can provide a hedge of protection if your advisor or accountant ever receives a call from someone posing as you. A trusted contact can also enable your advisor or accountant to confirm your current contact information, health status, legal guardian, trustee, and more.
3. Designate a POA
If you become physically unable to make your own financial decisions and need to appoint someone to make these decisions for you, you may want to consider designating a Power of Attorney to a loved one. This will allow our team to confer with an appointed person on major financial decisions, especially if you’ve fallen victim to a potential scam and need someone to act on your behalf.
4. Take Measures to Protect Your Identity
Avoid scams and protect your identity by creating strong passwords, regularly updating your computer operating system, and not answering unknown phone calls, emails, or texts. Additionally, never click on links in emails unless you have verified they are legitimate and safe; instead try searching the website on your internet browser directly. For more information about ways to protect your identity, read our blog with specific steps you can take. (Click here to read this blog.)
In the digital age, new scams pop up every day, and it feels impossible to keep up with all of them. By being aware of the newest tactics that are circulating, who might be targeted, and the best practices you can take, you provide a layer of protection to defend yourself against fraud. At Storen Financial, we are committed to your security, which is why we strive to equip you with the tools needed to avoid scams and keep your financial information intact. For more information about how our team prioritizes your security, read our data security blogs. (Click here to read these blogs.)
For your peace of mind, we also use our secure Client Portal where you can upload your financial documents with the knowledge that we will safeguard your personal information. (Click here to learn more about our Client Portal.)
Have questions? Contact us today for more information about data security, our client portal, or our services. (Click here for contact information.)
Want to learn more?
Here are a few resources to help answer your questions…
Tips Protect Seniors from Financial Scams – Hillsdale Daily News
Phishing Scams: How to Protect Yourself – Wayne State University
The Top 5 Financial Scams Targeting Older Adults – NCOA
Elder Fraud, in Focus – FBI
Pig Butchering Scams: What They Are, Warning Signs, and How to Avoid Them – Investopedia
Blog by Greg Storen, MBA – President/ CEO, Advisory Services Director
Learn more about Greg and the rest of the Storen Financial team here.
Ed Slott is not affiliated with LPL Financial and Storen Financial and Brass Tax Wealth Management.