Some segments of the population are more attractive than others to criminals engaged in fraudulent activity. Unfortunately, seniors are very appealing to fraudsters for several reasons, according to the Federal Bureau of Investigations. For example, seniors are more likely to be homeowners, and also have savings and excellent credit scores. Further, while younger people may be more cynical and less likely to even listen to an unscrupulous pitch, older Americans tend to be more trusting.

The FBI also notes that seniors are less likely to let others know that they’ve been scammed because they don’t want their relatives to question their level of financial literacy. Compounding the problem: in some cases, seniors may not realize that they have been victimized. Since the best defense is a good offense, below are various scams that seniors should be aware of.

The Counterfeit Prescription Drugs Scam

The high percentage of seniors who take some type of medical drug is one reason why they are prime targets for counterfeit prescriptions. According to the Food and Drug Administration, seniors account for 40% of drugs prescribed in the U.S., and seniors between the ages of 65 and 69 consume an average of 14 different prescription medications.

Counterfeit prescription drug scams can take place in-person or online. The FDA warns against purchases that are not from U.S.-based, state-licensed pharmacies. Seniors who buy medications online should check to see if the site has a Verified Internet Pharmacy Practice Sites Accreditation Program (VIPPS) seal of legitimacy. Also, seniors can contact the National Association of Boards of Pharmacy (NABP) or their state’s board of pharmacy to ensure that the company is in the U.S. and is licensed.

Whether prescriptions are purchased online or over the Internet, always check refilled prescriptions to ensure that the numbers are the same, and ask questions if the drugs look or taste differently, or produce unexpected side effects.    

Reverse Mortgage/Foreclosure/Refinancing Scams

Knowing that seniors usually live on a fixed income and would welcome a lower, or even no monthly mortgage payment makes this segment of the population a prime target for mortgage scams. The FBI reports that these reverse mortgage or mortgage assistance scams may appear as TV and radio ads, which can make them appear to be legitimate, or they may be sent through the mail or as an email advertisement. However, some scammers even seek out seniors at churches, seminars, and various clubs and organizations geared toward seniors. Sometimes, seniors unwittingly sign over their homes to these scoundrels, or give them money that they think is helping to modify their existing mortgage payments. These tips can protect senior homeowners from mortgage scams:

  • Ignore unsolicited advertisements, and don’t search the Internet for mortgage relief.
  • Take the time to research and find your own mortgage lender/counselor.
  • If you receive a letter stating that your mortgage was sold, contact the original mortgage holder yourself using the phone number you already have.
  • Don’t send your payments to the new holder until the change has been verified.
  • Never pay upfront fees for a mortgage modification.
  • Don’t be fooled by a professional appearance or flashy documents. Scammers understand the importance of looking the part.
  • Never sign a document that you don’t understand.

Security Alerts/Payments/Prizes Scams

 Seniors have a good reputation for paying their bills on time, and scammers use this information to discover pertinent confidential information. They use a variety of tricks, such as calling seniors while pretending to be a representative of the local power company. In this scheme, the scammer will tell the senior that there was a problem with their payment, and the banking account information needs to be verified. In another scam, someone calls pretending to be a representative of the local law enforcement agency and states that there is an outstanding motor vehicle ticket that must be paid immediately over the phone, or the senior will be arrested.  

Or the scammer may call to say that the senior’s bank or credit card account may have been breached, and then ask for financial information to verify the breach. Most seniors are so frantic when they get these calls that they don’t stop to consider that the caller hasn’t even told them the name of the bank or credit card holder. And that’s because the fraudster doesn’t know this, or any other information until the senior reveals it. Also, most company policies prohibit representatives from asking customers for personal financial information.

Whenever anyone calls, sends an email, or appears in person asking for account information, do not comply with these requests. It’s best to call the company, using the phone number provided on previous official documents.

Seniors are also targeted for scams involving gifts and free prizes. Often the fraudster will claim that the prize is free, but the senior needs to pay for shipping and handling. Often, the senior is warned that immediate action is necessary, or the prize will be given to the next person on the list.

Miscellaneous Scams

Other types of scams that seniors should be aware of include:

  • Medical equipment fraud: seniors are promised free medical equipment that will be paid for by Medicaid. However, they may be charged for accessories and other products that they did not order.
  • Funeral and cemetery fraud: seniors are charged a certain price for burial insurance and funeral services, but don’t receive what they’re being charged for.
  • Miracle cures: seniors are tricked into purchasing products that may promise to remove wrinkles, reverse the signs of aging, and other miraculous results that are too good to be true.

The Bottom Line

The golden years should be a time for relaxing and enjoying the best that life has to offer. However, there is no shortage of scam artists trying to swindle seniors out of their hard-earned and often limited money. Knowing the tricks of the trade provides the first line of defense against fraudulent activity.