BID® Daily Newsletter
Nov 4, 2021

BID® Daily Newsletter

Nov 4, 2021

Stemming The Rise Of Elder Financial Fraud

Summary: Senior citizens have often been the target of fraudsters. Yet, 2020 was a record year for this segment who was more isolated physically and more active digitally. Total fraud losses for seniors reached $1B last year and affected over 100K victims. Here are some of the top scams along with key communication points to pass on to your senior customers.

Statista reports that in 2019, 16.5% of the US population was 65Ys and older. That number is projected to rise to 21.6% in 2040. There are many ramifications of an expanding pool of senior citizens. One of them is the larger group attracts more scam artists.
While senior citizens have been scammed for decades, they are more at risk these days. Many elderly bank customers are separated from others out of concern for their health and well-being. For financial fraudsters, this audience of isolated, lonely bank customers, often with good credit and sizable accounts, represents a huge opportunity.
In addition, seniors are more active digital users these days, creating extra fraud prospects. More than 57% of bank customers over the age of 51 — and that percentage will likely skyrocket as Gen Xers age up — are flocking to utilize digital-only banking or even nonbank-related products.
As a result of these factors, the incidence of financial fraud hitting the elderly has jumped. According to the 2020 FBI Internet Crime Complaint Center report, total losses for seniors over 60Ys amounted to $1B last year, which was an increase of 30% over 2019. More than 100K victims were affected by scam artists vs just under 70K in 2019.
The stakes are getting higher, making it more important than ever to keep seniors aware of the latest scams. Here are a few scams to share with your customers and their families to keep them safe.
Romance scam. Bad actors haunt online dating sites or other social media, feigning romantic interest in lonely older people to get money out of them
Parent/grandparent scam. A cybercriminal poses as a family member, usually an adult child or grandchild of the target, and demands or requests financial assistance (sometimes set up to look like a ransom, especially if the relative is traveling)
Charity or lottery scam. The bad guys claim to work for a nonprofit or charitable organization, sometimes promising "prizes" or rewards for people who might contribute to the supposed cause
Home repair scams. Criminals offer home improvement services from painting to gutter cleaning and ask for payment in advance, but they never deliver.
Continuous communication is key in preventing your customers from falling prey, at an unfocused moment. Use multiple channels so that if they are not on your website, they will still find the information in your branch or on your latest email.
Key messages for your customers: 
  1. Confirm the contact information of supposed charities, businesses, friends, or other entities who seek to connect online. 
  2. Take a step back. Legitimate businesses or personal contacts should not demand immediate action. Bad actors like to create a sense of urgency in order to elicit a speedy, unrealistic response from older targets, who might be made to feel in danger.
  3. Do not offer any personally identifiable information or financial access if you feel uncertain. Financial institutions and legitimate service providers will rarely, if ever, request such information immediately, by phone, email, or text. 
Helping to keep your senior customers safe is vital. Regularly check the FBI website for new scams and communicate clearly to your customers to nip this rising threat in the bud. 
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