Elder fraud is becoming a prevalent issue, with online scams targeting individuals aged 60 and older, causing over $3.4 billion in losses in 2023 alone. The rapid growth of this problem is alarming, as many scams go unreported. Older individuals are particularly vulnerable to these scams due to their social isolation, cognitive changes, and lack of internet savvy. Scammers often target older individuals with tech support schemes, investment scams, and cryptocurrency frauds, which have contributed to the increase in losses.
One common scam known as the pigeon drop involves persuading victims to pay a small amount of money in order to receive a larger sum. Scammers have now adapted this scam to utilize texting and online relationships to develop a false sense of trust with their victims. Cryptocurrency and speedy money transfers have made it more challenging to recover stolen funds, as funds are often transferred out of the country within 24 hours, making it difficult to trace.
Financial institutions like Zelle have faced scrutiny for not doing enough to protect or reimburse victims of fraud. The use of cryptocurrency or crypto wallets by fraudsters has also increased in recent years. To protect against online financial fraud, it is essential to be aware of warning signs, such as promises of high returns, being asked to keep secrets, and pressure to act quickly. Individuals should also be cautious of phone calls or texts from official-sounding numbers and requests to wire money, send bitcoin, or buy gift cards.
Having a trusted contact designated with financial institutions can provide an added layer of security, as they can be reached out to if suspicious activity is detected. Trusted contacts do not have control over the account, but their involvement can help protect against financial exploitation. It is crucial to report fraudulent activity immediately and take necessary steps to protect personal information and accounts. By taking precautions and being vigilant, individuals can protect themselves against online financial fraud and help prevent future victims.
