Financial scams frequently target seniors, especially over the telephone and Internet. According to research conducted by MetLife, older adults lost a total of $2.9 billion in 2010 to common fraudulent activities. These scams are particularly frustrating for those seniors who are dealing with other financial concerns, such as the retirement cost of living. The best way for seniors to protect themselves against fraud is to learn about the most common criminal practices.
Lottery or sweepstakes
The National Council on Aging detailed the lottery scam, which is when seniors are told that they have won a large sum of cash for which they must pay taxes before they can deposit it. People hand over the requested amount of money or reveal their bank account numbers to the caller. They never receive the reward, but they lose the cash they've fronted to cover lottery fees, as well as whatever else the thieves choose to steal.
Seniors who are targeted over the telephone should never reveal bank account information if they are not positive they are speaking to a verifiable organization. If there are any doubts raised during the conversation, seniors should trust their instincts and opt for paying in person. This also stands true for Internet purchases - seniors should never enter credit card information unless the company's certification is prominently displayed on the screen.
Another common fraudulent tactic is known as the "grandparent scam," where callers pose as estranged grandchildren in trouble. Seniors, more concerned with ensuring their relatives are safe than verifying their identities, release monetary information to help any way they can. The best way to avoid getting entangled is to ask questions to make the callers prove they are who they say, including inquiries about family history, information about themselves or what their parents names are.