Scams Targeting Retirees—and How to Prevent Them

Published on October 18, 2024 | Webster Bank

Fraud is a growing concern, with scams targeting retirees or people aged 60 and older becoming increasingly sophisticated and widespread. Understanding common scams and how to prevent fraud are crucial to protect yourself and your loved ones.

The Broad Impact

The financial impact of age-targeted fraud is profound, exploiting older Americans out of an estimated $28.3 billion annually. Even more concerning is that 87.5% of adults aged 60 and older who are victimized by someone they know never report these incidents to authorities.¹ This underreporting makes it difficult to grasp the full scope of the problem and highlights the need to raise awareness and support for victims.

Four Common Scams and How to Prevent Them

 1. Romance Scams

Romance scams are particularly insidious, as scammers prey on the loneliness that some retirees may experience. These fraudsters often meet their victims on dating sites or social media, where they feign romantic interest to start up a relationship. These scams can unfold over several messages, calls, emails, and texts, sometimes spanning weeks or even months. Eventually, the scammer earns trust. So when they fabricate a financial emergency, a victim will be more willing to send money for apparent medical bills, travel expenses, or other urgent needs.

Prevention tip: Be cautious—even vigilant—about online relationships. Never send money to someone you haven’t met in person and be cautious of anyone who asks for financial help, especially early in the relationship.

 2. Investment and Lottery Scams

In this type of fraud, scammers lure victims with promises of high returns on investments or by claiming they have won a lottery or sweepstakes. To claim these supposed winnings, people are often asked to pay up-front fees or provide personal information.

The financial toll from these scams is staggering, with reported losses exceeding $1 billion annually.² As many victims are too embarrassed to come forward, the true figure is likely much higher.

Prevention tip: Be wary of any unsolicited investment opportunities or lottery winnings that require payment up front. If it sounds too good to be true, it probably is.

 3. Tech Support Scams

Tech support scams are a particularly dangerous threat to those who may be less familiar with technology. Posing as tech support agents, fraudsters convince victims that their computer is infected with malware, then charge for unnecessary or nonexistent services.

These scams have become one of the most common forms of elder fraud, generating a significant number of complaints each year.

Prevention tip: Never grant an unsolicited contact access to your computer. If you need tech support, always reach out to a trusted service provider directly.

4. Grandparent Scams

Grandparent scams exploit the strong emotional bond between grandparents and their grandchildren. In these scams, fraudsters pose as a grandchild in distress, often claiming to need money for bail, hospital bills, travel, or another urgent predicament. They may even plead for secrecy, asking the grandparent not to tell anyone else about the situation.

At best, these scams are emotionally manipulative, and at worst, financially devastating.

Prevention tip: Always verify the identity of the caller before sending any money. A simple call to your grandchild or their parents is all it takes to confirm whether the request is legitimate. Remember, a true emergency involves multiple family members, not a single phone call in the middle of the night.

Preventing Growing Threats

Fraud is a serious issue that affects millions of retirees each year. By understanding the different types of scams—romance scams, investment scams, tech support scams, and grandparent scams—you proactively stay one step ahead of threats. Vigilance, education, and open communication are key to preventing these scams from claiming more victims.

If you or someone you know has been targeted, don’t hesitate to report the incident to the authorities. Protecting each other from financial exploitation is a collective responsibility, and spreading awareness is the first step to combat this growing problem.

Resources:

¹ AARP Report Finds $28.3 Billion a Year Is Stolen from S. Adults Over 60

² FBI Releases 2023 Elder Fraud Report with Tech Support Scams Generating the Most Complaints and Investment Scams Proving the Costliest — FBI