July 9, 2012
Rising incidents of scams targeting older adults present an enormous threat to seniors' security, both financially and emotionally. Senior fraud victims may suffer long-lasting trauma that often erodes their sense of trust and well-being, eldercare experts have noted.
Three crimes, in particular, are on the rise, experts say. They are identity theft, Medicaid/Medicare and medication fraud, and financial exploitation.
A recent MetLife study titled "The MetLife Study of Elder Financial Abuse" revealed that the annual financial loss by victims of elder financial abuse is estimated to be at least $2.9 billion, a 12 percent increase since 2008. Details of these crimes, from National Association of Triads Director Ed Hutchison, include:
- Health care fraud including Medicare/Medicaid scams and medication theft. The major fraud tactic in this growing industry that frequently gets ignored is the misuse of a medical card. Scammers fabricate treatment and get paid for it. Another strategy involves finding a senior in need of medical supplies, calling him or her and saying, "Give us your Medicare card number and we can send your supplies through the mail." Or criminals can obtain treatments or medication by assuming an older adult's identity.
The World Privacy Forum revealed that a half million Americans have been victims of identity theft and health care fraud. The National White Collar Crimes Center puts the loss due to health care fraud at $100 billion or 10 percent of America's total health care expenditures.
What's more, many seniors take multiple prescription medications. Crimes of theft and fraud are being committed by those who break into a senior's home for the purpose of stealing those medications.
- Identity theft. It's amazing the damage a scammer can do with the last four digits of a Social Security number. Those important four numbers can be combined with employment history and addresses to take out loans and lines of credit.
Scammers sometimes find Social Security numbers on the Internet, so that's why it's important to check your senior's credit often. By law, everyone gets one free credit check a year. Staggering requests among the three credit companies – Experian, Equifax and TransUnion – can allow consumers to check their credit every few months.
- Financial exploitation. The financial exploitation of seniors comes in the form of a variety of cons. One of the most successful deceptions perpetrated recently on older adults is the grandparent scam. The fraudster calls the senior claiming to be a grandchild in need of money. The grandparent is instructed to wire money ASAP. "A senior in the community fell for this," said a Home Instead Senior Care® franchise owner recently. "Fortunately, Western Union was suspicious and held up the transaction, successfully averting the crime. This happened before the senior became a Home Instead Senior Care client, but she is still upset."
Older adults have a high likelihood of becoming the target of a scammer sooner or later, experts say. It might come in the form of a knock on the door, an offer to shingle the roof, a phone call from a friendly voice that guarantees big savings on medications, or an email that promises the biggest return ever on an investment.
Learn the three Financial Abuse Tactics (PDF 420k) that fraudsters use to deceive unsuspecting older adults.
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