While Americans of all ages can fall prey to financial fraud, when seniors get scammed they tend to lose more money than younger victims.
In 2021, scam victims in their 70s lost an average of $800 to fraudsters, while those older than 80 had an average of $1,500 taken, according to an FTC report. By comparison, 60- to 69-year-olds lost an average of $520.
“Unfortunately, seniors are universally highly vulnerable and disproportionately targeted by these criminal campaigns,” according to Clayton LiaBraaten, spokesperson for Truecaller, which provides caller ID and spam blocking for phone calls and text messages.
[READ: The Best Cell Phone Plans for Seniors.]
“Our elders may be less familiar with technology and more trusting when someone misrepresents a government agency or a company,” he adds.
Financial Exploitation Prevention Act
The Financial Exploitation Prevention Act, which recently passed in the House of Representatives, aims to protect older Americans from financial fraud.
It would require some financial services firms to delay their responses to redemption requests from older customers if they believe the the person is making the request because they’re being financially exploited.
[SEE: 9 of the Biggest Financial Fraud Cases in History]
If passed by the Senate, the regulation would codify an existing Financial Industry Regulatory Authority rule that has existed since 2017, allowing companies to delay redemption for up to 25 days if they have concerns about financial exploitation.
“FINRA has another rule that requires brokers to ask customers (regardless of age) to provide the name of a trusted contact, such as a family member or friend,” according to Steve Weisman, senior lecturer in law taxation and financial planning at Bentley University and owner of the website Scamicide.
“The broker could reach out to that person if there is reason to believe the client is being exploited financially, such as because they are suddenly withdrawing large sums of money or appear to have cognitive impairment,” he says.
The bill also would allow state courts or other regulators to investigate the suspected exploitation.
Another provision of the Financial Exploitation Prevention Act would require the U.S. Securities and Exchange Commission to provide Congress with recommendations on further protecting seniors from financial scams.
Common Scams
LiaBraaten says that some of the more common rackets for seniors and their loved ones to look out for include Medicare, Social Security and IRS imposter scams, in which the crooks pose as agency government representatives and trick seniors into sending money or handing over personal information.
[Read: 10 Things to Do if Your Identity Is Stolen.]
While a similar bill that passed the House in 2021 failed to pass the Senate, the prospects for this bill could be better, given the strong bipartisan support for its passage.
“It is not every day, especially in a closely divided, partisan Congress, that we see a bill pass in the House by a vote of 419-0,” John Jennings, director, government and political affairs at the Insured Retirement Institute, says.
If you suspect that you or someone you love has been the victim of elder financial abuse, you should report the incident immediately. In addition to filing a police report, you can report scams to the Federal Trade Commission and to relevant agencies, such as the Social Security Administration or IRS.
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Congress Bill Designed to Help Prevent Elder Financial Fraud originally appeared on usnews.com
