Elder Fraud: Difficult to Prevent, Even Harder to Recover Your Loss

In 2010, when my dad was 90, he lost $4,000.00 to a combination lottery/bad-check scam. I looked at his bank account online almost daily, but when I asked him why he had withdrawn that large amount, he wouldn’t tell me. He said something like, “I can’t tell you now, but you’ll be so happy in a few days.” Then I saw that he’d deposited a check supposedly drawn on an Idaho Falls, Wells Fargo bank for $4,000. After a 3-day bank holiday weekend, it “bounced.”

"The same scam or a version of it, is still taking money from seniors today."

Here's how it all came down:

“A nice young man” contacted my Dad to tell him that he had won $1,000,000.00 in a lottery. A check would be arriving in the mail, but first he needed to send $2,933.53 via Western Union to a U.K. address to pay taxes on the money. When he agreed, at some point he was asked for $844.00 more. My Dad was told there was no risk to him because they would rush a check to him for $4,000.00 to make up the difference.

My Dad, who had been a purchasing agent at the beginning of his long and prestigious career didn’t stop to think that he hadn’t entered a lottery, question that he was being asked to send the money out of the country, or even think it was strange that the $4,000.00 check he received looked like it was from the account of an Idaho hardware store. All his previous financial skills were overridden by typical senior trust and the thought that he was about to receive a lot of money tax-free.

I knew my Dad’s $4K was gone forever, but I was mad at who I thought were, if not the perpetrators, at least accessories to the crime, and I set about tracking them down.

Zions Bank was my first stop. I had been told that they would notify the joint holder of an account with an elderly person if an unusually large amount of money had been withdrawn in cash. The excuse the bank manager gave for not notifying me was that the withdrawal occurred on the day before a long, understaffed, weekend. He agreed that someone should have questioned the transaction when an elderly man made a large withdrawal and requested that it be wired to an address in the U.K. Apparently, committing fraud that involves a bank is much more likely to occur over a long weekend for that very reason and because it takes longer for a check to bounce or a large transaction to be discovered by family members. However, the bank “could do nothing” to get his money back.

I went next to my neighborhood Wells Fargo Bank. I had in hand what I thought was one of their bounced checks. Yes! They were aware that the name of their bank was being used in lottery fraud, but because the check was obviously a forgery, easily determined because the routing number was not theirs, and as long as they were not losing money, there was nothing they could do about it. When I protested, they gave me the phone number of their fraud headquarters in California.

From the Wells Fargo Fraud Office, I learned that not only couldn’t (wouldn’t?) they do anything about it, even the FBI wouldn’t take on this case because the money went not just across state lines but to a foreign country. Not only that, but they also don’t even try to track down cases where the loss is less than $7,000. Smart crooks! Keep the loss amount “low.” I did file a formal complaint with Wells Fargo that included documentation.

The hardware company in Idaho was my last “accessory” contact. Yes! The company name and phone number on the check were real. I spoke with a manager who said, “Yes,” they were aware that their company name was being used on forged checks, but “No,” they didn’t plan to do anything about it. Aghast, I asked if they weren’t worried about losing customers with an attitude like that. He replied that all their customers were in Idaho and the fraud always took place in other states. Really!

The Moral(s) to this Story

There are several lessons we elderly (all) people can learn from this story:

• Don’t trust anyone who contacts you asking for money for any reason until you first check out their credibility.
• If your kids tell you, ”It’s too good to be true,” believe them and not someone who says, “There’s no risk to you.”
• Be aware of the most common fraud scams, and don’t think you’re too smart to be caught in one. (see below
• Don’t wire money or send cash or credit cards to someone you don’t know, especially out of state.
• Businesses or banks who aren’t being harmed are not going to/can’t help you recover your loss.

FYI:While I was writing this blog, I got a call from my daughter in Indiana. She was checking on my safety and alerting me that she had gone so far as to tell a fraudulent caller that the address they gave her was her mother’s. Fortunately, other than answering a call from someone she didn’t know, that was all the personal information she provided before she ended the call. Moral: don’t answer a call if you don’t know who’s calling. If they know you, they will leave a message.

9 Most Common Senior Scams:

1. Tech support scam: Criminals pose as technology support representatives and offer to fix non-existent computer issues. The scammers gain remote access to victims’ devices and sensitive information. (Most reported scam in 2023)
2. Romance scam: Criminals pose as interested romantic partners on social media or dating websites to capitalize on their elderly victims’ desire to find companions.
3. Grandparent scam: A type of confidence scam where criminals pose as a relative—usually a child or grandchild—claiming to be in immediate financial need.
4. Government impersonation scam: Criminals pose as government employees and threaten to arrest or prosecute victims unless they agree to provide funds or other payments.
5. Sweepstakes/charity/lottery scam: Criminals claim to work for legitimate charitable organizations to gain victims’ trust. Or they claim their targets have won a lottery or sweepstake, which they can collect for a “fee.”
6. Home repair scam: Criminals appear in person and charge homeowners in advance for home improvement services that they never provide.
7. TV/radio scam: Criminals target potential victims using illegitimate advertisements about legitimate services, such as reverse mortgages or credit repair.
8. Family/caregiver scam: Relatives or acquaintances of the elderly victims take advantage of them or otherwise get their money.
9. Investment scams were the costliest kind of elder fraud in 2023. These schemes cost victims more than $1.2 billion in losses last year.

Why and How to Report Fraud

Report a fraud/scam to one of the government agencies below, even if you believe you won’t get your money back. In rare cases you can, and at least your report will help to alert many other victims of a probably common fraud and help the government track their frequency and location.

Elder fraud complaints to the FBI’s Internet Crime Complaint Center or IC3 (click to report fraud that breaks a Federal law) increased by 14% in 2023, and associated losses increased by about 11%, according to IC3’s 2023 Elder Fraud Report, released April 30, 2024. Many of these crimes go unreported, and, as the report states, “only about half” of the fraud scam complaints submitted to IC3 in 2023 included victims’ ages.

Condensed advice from AARP (click for more):

• Start with the police (essential if you want to make an insurance claim on stolen property).
• Report compromised credit or debit card information to the card issuers.
• Call the AARP Fraud Watch Network hotline (877-908-3360) for advice on the best next step.

Call the National Elder Fraud Hotline to assist an elderly loved one who has been victimized by scammers. The toll-free number is 833-FRAUD-11 or 833-372-8311. They are available every day 4 a.m.-9 p.m. Western Time.

Find several Utah resources here on this website: financialfraud - Utah Commission on Aging - University of Utah, and check back here for my next blog, How to Protect Yourself and Your Loved Ones from Fraud.

 

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