Financial exploitation is a type of elder abuse. Financial exploitation could lead to great strain for a senior citizen, derailing a retirement plan and causing hardship in what should be the victim’s golden years.
Statistics underestimate the true prevalence of this problem, but studies show up to 6.6% of the elderly population in the U.S. experience financial exploitation. Scammers rely on several types of financial exploitation schemes to trick seniors into serious financial loss.
Phone and telemarketing scams
The elderly are often targets for phone and telemarketing scams since they are more likely to conduct business and make purchases over the phone. Phone scams may include ploys to get the victim to donate money to a charity or special cause that does not exist, or someone claiming to be from the IRS requesting sensitive personal information. The scammer may then use this information to steal the victim’s identity.
Fake investment opportunities
An elderly victim could lose thousands of dollars in a fake investment scheme. Solicitors may try to get the victim to sign up for pyramid schemes, timeshares or startup companies that do not exist. Seniors should look out for common signs of fraud, such as alleged opportunities to make money through exempt securities, foreign exchange markets or offshore investing.
Lottery fraud schemes
One of the most common financial exploitation scams targets people who play the lottery. The fraudster will contact the victim – typically via email – and say the individual has to make a small deposit to access his or her winnings. Sometimes scammers in these scenarios will even send the victim a fraudulent check, which will bounce while they make off with the money.
Caretaker financial exploitation
May instances of elder financial exploitation occur right at home, or at a nursing home or long-term care center. Caregivers might take advantage of their positions of power to deceive the client into giving monetary gifts, writing the caregiver checks or even changing the terms of a will. The perpetrator in these scams is often someone close to the victim, such as a friend or family member.