Chances are, you may have been swindled at some point in your life, or you know someone who has. Nearly half of consumers surveyed recently by Stanford University’s Center on Longevity and the Finra Investor Education Foundation reported being a victim of financial fraud in the previous yeara far higher tally than earlier surveys indicated. No socioeconomic or demographic group is immune. “Men and women, college students and retirees, rich and poorall are potential targets,” the report’s authors found. Nearly 40% of victims never told anyone about the fraud.
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Estimates are problematic, but Americans are thought to lose some $50 billion a year to financial scams. And there are indirect costs: bounced checks, late fees, trouble meeting monthly expenses and even bankruptcy. So it’s not surprising that the emotional cost of fraud is also high, with 50% of victims reporting severe stress and more than one-third citing depression. The toll is compounded for senior victims, who have little time to make up for lost resources. “When elderly people lose their life savings, they lose hope,” says Ricky Locklar, an investment fraud investigator at the Alabama Securities Commission. “To me, those crimes are worse than someone robbing the corner drugstore at gunpoint.”
Do these four things to protect you or your family members from elder abuse:
1. Don’t trustverify. Be suspicious of calls or e-mails asking for personal or financial information. “Hang up and follow up,” says Juliana Harris, of the South Carolina Department of Consumer Affairs. Look up the phone number of the government agency or financial institution independently, and call to find out if the caller or correspondence was legitimate. Stay on top of the newest scams by signing up for alerts from the Federal Trade Commission at www.consumer.ftc.gov/scam-alerts. Learn about new tax-related scams at IRS.gov.
2. Report scams. Report an attempted scam, even if you didn’t fall for it, at www.ftc.gov/complaint. The Federal Trade Commission adds the information to a database that federal and state agencies and law enforcement groups use to spot trends and support larger investigations. If you believe you’ve been scammed, get help from your local or state consumer protection office (see www.usa.gov/state-consumer). Get help from your Area Agency on Aging at www.n4a.org.
3. Enlist family help. Adult children can talk with their aging parents about reviewing their bank accounts and credit card statements (see How to Provide Financial Help to Aging Parents). Some banks provide read-only access to accounts, which can help children spot suspicious charges without providing access to parents’ money, says Naomi Karp, senior policy analyst with the Consumer Financial Protection Bureau’s office for older Americans.
4. Beware of high-commission salespeople. They may be trying to get a piece of your retirement savings. Call Finra’s Securities Helpline for Seniors with questions (844-574-3577).
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