Helping Protect Older Adults from Financial Scams

Financial scams targeting older adults continue to rise, with billions of dollars lost each year. While fraud can affect individuals at any stage of life, older adults are often targeted due to accumulated assets, perceived financial stability, and a greater susceptibility of misplaced trust.

Following increased reporting from federal and consumer protection agencies, this article highlights common scam types, warning signs, and practical steps to help reduce risk.

Why Older Adults Are Frequently Targeted

Scammers often focus on older individuals because they may have retirement savings, home equity, or other accumulated wealth. Fraudsters may also assume that older adults are less familiar with evolving technology or less likely to report suspicious activity.

These schemes are designed to create urgency, exploit trust, and pressure individuals into making quick financial decisions.

Common Types of Financial Scams

Below is an overview of frequently reported scams targeting older adults:

• Impersonation Scams: Fraudsters may pose as family members, financial institutions, or government agencies. These scams often involve urgent requests for money related to emergencies or legal matters.
• Financial Account Scams: Scammers may claim an account has been compromised and request sensitive information such as login credentials or verification codes.
• Technology-Related Scams: Pop-up alerts or unsolicited calls may indicate a device issue, prompting individuals to grant remote access or make payments for unnecessary services.
• Government Impersonation Scams: Fraudsters may claim to represent the Internal Revenue Service (IRS), Social Security Administration, or Medicare, often threatening penalties or loss of benefits.
• Investment Scams: Offers promising guaranteed returns or low-risk opportunities—particularly those involving unfamiliar or digital assets—should be approached with caution.

Key Warning Signs

Common indicators of potential fraud include:

• Urgent or time-sensitive requests for payment
• Requests for payment via gift cards, wire transfers, or peer-to-peer platforms
• Unsolicited communications requesting personal or financial information
• Instructions to keep the matter confidential
• Unusual or unexpected changes in financial activity

Preventive Measures

Proactive safeguards can help reduce exposure to financial fraud:

• Verify Requests Independently: Confirm requests using known and trusted contact information before taking action.
• Establish Account Safeguards: Consider transaction alerts, withdrawal limits, and fraud monitoring tools where available.
• Designate a Trusted Contact: Many financial institutions allow a trusted contact to be listed on accounts in case of suspected financial exploitation.
• Maintain Updated Security Measures: Ensure devices are protected with current software updates and security tools.
• Encourage Ongoing Communication: Regular discussions among family members regarding financial activity can help identify concerns early.

Pause Before Acting

A common tactic used by scammers is to create a sense of urgency. Taking time to verify a request or consult with a trusted individual before acting can help prevent costly mistakes.

What to Do if Fraud Is Suspected

If suspicious activity is identified, prompt action is important:

• Contact financial institutions immediately
• Report the incident to local law enforcement or the Federal Trade Commission (FTC)
• Review accounts for unauthorized transactions

Early reporting may help limit financial losses and prevent further activity.

Planning Considerations

Helping protect older adults from financial scams is an important component of overall financial planning. Many seniors have fallen victim to talented scammers even though the senior is typically financially savvy and an astute businessperson.

Key considerations include:

• Reviewing account safeguards and monitoring tools
• Establishing trusted contacts where appropriate
• Discussing potential risks with family members
• Remaining informed about emerging fraud trends

As financial scams continue to evolve, maintaining awareness and implementing preventive measures can help protect long-term financial security. Please contact your LMC professional if you have any questions.