I spent fifteen years leading the marketing department of a credit union. I launched new products, promoted loans and credit cards, and advertised savings rates. Sadly, I also had to educate members about people trying to take their money. That includes criminal fraudsters, but also friends and family.
Older adults are particularly vulnerable to scams or financial exploitation. The reasons are understandable. If you spend any time around someone 65 or older, you know they answer the phone every time it rings. It’s an ingrained habit from the time before answering machines. That means they’re more likely to end up talking to a fake FBI agent or conniving scam artist.
New technology is also making fraud easier. Artificial intelligence (AI) is being used to create duplicate websites, targeted emails, and even familiar-sounding voices. It’s not always easy to tell who’s a criminal and what they’re after. Some schemes try to get personal information like account numbers and passwords. Others are looking for a “mark” who can be conned out of money. We can all be duped, but our parents and grandparents are especially vulnerable.
Make life hard for fraudsters
In my time at the credit union, I heard about members coming into a branch and asking to withdraw an unusually large amount of money. If a transaction seemed suspicious, branch staff were trained to ask questions. In one case, a woman said her grandson was in trouble and needed money wired to him right away. The representative suggested she call her grandson’s number and check on him. He answered and had no idea what was going on—scam averted.
Other scams included people promising lucrative investment deals or sweepstakes winnings with the payment of an up-front fee. On the darker side, callers pretending to be FBI agents tell members to send them money to “protect it from fraud.” I even know someone whose parents sent ransom money to a caller who said they’d kidnapped her. It happened when she was sitting in my living room having tea.
Yes, fraud is getting more sophisticated, but there are still things we can do to thwart their efforts:
- Remind your older relatives not to answer unknown calls. If a call is important, it will go to voice mail where they can deal with it.
- Fraudsters prey on big emotions, especially fear, urgency, excitement, and greed. A way to stop them in their tracks is by asking for their number and saying you’ll call them back. This tactic buys time to think about what’s happening.
- If a call doesn’t seem legitimate, go directly to the source. For example, if someone says they’re about to shut off your electricity, look up the power company’s number and call them directly.
- Be careful of emails from unknown sources, don’t click on links within the email and always check the email address to confirm that it matches the actual service provider. If an email (or text) seems suspicious, go directly to the source.
- Remember the basics: If a deal seems too good to be true, it probably is. Never make decisions under pressure. And a healthy dose of skepticism is not a bad thing.
Financial caregiving:
Unfortunately, a more insidious source of exploitation for vulnerable adults can come from those closest to them—family members, friends, and caregivers. This can be complicated by family dynamics, as well as the fear and suspicion that often accompanies dementia. If your family is entrusting one person to care for a relative, communication is key:
- Designate a trusted family member to help you manage and review your financial accounts.
- Set account alerts to trigger when there’s a larger than usual transaction.
- Contact each of the three credit reporting agencies and request a freeze to prevent identity theft.
- If a trusted caregiver is helping to pay bills, make sure they only have access to the necessary funds each month. Check account activity on a regular basis.
It turns out that one of the best ways to avoid being a victim of fraud or financial exploitation is awareness. I talk to my Mom about different scams I’ve heard about, and it’s made her pretty cautious. Now, whenever she gets a letter or email about financial matters, she shows it to me. She still answers the phone whenever it rings, but if it’s someone she doesn’t know, she hangs up pretty quickly.
More about protecting your family:
- AARP has lots of information on their website about avoiding fraud, as well as an entire section on caregiving.
- Talk to your family member’s financial institution(s) about steps you can take to keep their money safe.
- Creating a financial plan is a great way to get family members on the same page about budgets, priorities, and the future. Talk to your Arrivity financial planner about setting a meeting.
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Liz is a Late Boomer in the sandwich generation who started an independent writing and brand consulting practice after years as a senior marketing executive. She lives in Seattle, Washington. Her mother lives nearby and her daughter is a recent college graduate.
The foregoing content reflects the opinions or perspective of Liz Behlke and/or Arrivity financial planners and is subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns Securities investing involves risk, including the potential for loss of principal. There is no assurance that any investment plan or strategy will be successful. Arrivity does not give tax or legal advice. Tax and/or legal strategies should be discussed with a professional before implementing.