Financial exploitation is the fastest growing form of adult abuse, and among the most prevalent globally. With over 2.5 billion seniors at risk by 2030, this issue is a strategic priority for global organizations.
Our fraud and forensic professionals recently consulted on two cases of phone scams. Both victims were elderly females whose spouses were still alive. The victims received multiple phone calls each week from individuals who claimed that the victims were winners of large lottery payouts. To receive the payout, callers instruct the victims to wire funds to cover taxes, fees, or other expenses related to their winnings up front. The victims wire the money as directed, and the scam is complete. In many cases, the scammer runs off with the money and is never heard from again. In other cases, the same scammer continues to correspond with the victim, requesting additional funds for “taxes” or “problems” arising from the purported winnings. The promise of a payout, plus the sunk costs, can keep the victims participating over extended periods of time.
Grandparent Scams
Have your relatives been targeted by a grandparent scam recently? In a grandparent scam, fraudsters pose as a target’s relative, such as a grandson, who is in jail and needs money for bail right away. Grandpa immediately produces a credit card number or bank routing/account numbers over the phone to help his “grandson,” thereby granting the scammer access to the victim’s funds.
“Sucker Lists”
When an individual is targeted successfully, his or her name may be placed on a “sucker list.” Sucker lists are lists of people who have been taken advantage of previously, and therefore more likely to fall for a scam again. Sucker lists are available for purchase by other scammers online, and the fraud continues.
Prosecuting Scammers
Scams are difficult to prosecute. The perpetrators are often foreign, which prevents law enforcement in the United States from pursuing them. Even if the perpetrators are local, they usually do not hang around long enough to get caught, and they pack up their things and move to another part of the country. Funds are difficult to trace as well, especially if wired overseas, withdrawn as cash first, or paid via money order. In a recent case, the postal service intercepted a suitcase full of cash that the victim attempted to mail overseas. When funds and perpetrators cannot be traced, victims are unlikely to get any of their money back.
Consumer Education
Consumer education is key to preventing scams. A wealth of information is available online, but how do you reach a segment of the population, such as seniors, who may not even own a computer? Local aging services providers offer free scam prevention training sessions. Local senior services organizations and community centers may host similar training sessions on prevention topics.
If you are aware of an ongoing scam, or believe you may have been scammed, call the police. When you file a police report, ask what resources are available to fraud victims in your area. Law enforcement should be able to connect you with services and information you need to prevent scams in the future.
The Bonadio Group’s Fraud and Forensic Team has years of advisory experience in phone scams and related fraud matters. Please do not hesitate to reach out to our trusted experts to discuss your specific situation.
This material has been prepared for general, informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Should you require any such advice, please contact us directly. The information contained herein does not create, and your review or use of the information does not constitute, an accountant-client relationship.
