Scam Alert / Fraud Alert

Imagine answering your phone and hearing the caller telling you that your grandchild has been kidnapped and you must pay a ransom to secure your loved one’s release.

Then, you hear a voice screaming in the background, “Help me!” The caller tells you the ransom amount and where and how to send the money.

While the call may be unnerving, the call is more likely a “virtual kidnapping for ransom” scheme, one of many popular “Grandparent scams.” Law enforcement officials and senior advocates warn seniors to use caution when contacted by virtual kidnappers calling from unknown numbers.

Older adults lose an estimated $3 billion a year in financial schemes, according to the U.S. Senate Special Committee on Aging. The scams are usually committed by strangers but are sometimes committed by a senior’s adult children or grandchildren.

Reasons Why Seniors Become Targets

In many instances, scammers assume that seniors are lonely and willing to talk to anyone who calls or comes to their home. According to the FBI, fraudsters also assume that seniors:

Have financial savings
Own their own home
Have good credit
Are trusting and polite
Do not immediately realize that they have been scammed

What’s more, fraudsters believe that seniors are too embarrassed to report a scam. For one, seniors may not know which agency to contact and report the scam. In addition, older adults may fear that their family will believe they are no longer able to care for themselves since they fell victim to a “con” artist.

Avoiding Extortion in a Virtual Kidnapping Scam

Alleged kidnappers know that they have a short time to extort money from their victims. So, if the caller tries to keep you on the phone, and something does not feel right, hang up. However, if you engage the caller, the FBI recommends:

Do not tell the caller your grandchild’s name or share any family information.
Ask to speak to your grandchild and listen carefully to the person’s voice.
Ask questions that only the alleged kidnap victim would know, like the type and name of a pet.
Try to contact your grandchild, your son or daughter, or other relative to verify the information.
To buy time, repeat the caller’s request, tell them you are writing down the demand, or tell the caller you need more time to start the process.

The FBI also warns against paying any type of ransom, especially in person.

Top 10 Frauds Against Seniors

The National Council on Aging (NCOA) lists the Grandparent Scam, which includes “virtual kidnapping for ransom,” among the top 10 financial scams reported by seniors. The remaining frauds reported include:

1. Medicare/health insurance. Scammers pose as a Medicare representative to access seniors’ personal information. The imposters may also set up fake mobile health clinics to get seniors’ personal information, which they bill to Medicare and keep the money.
2. Counterfeit prescription drugs. Scammers set up websites to sell medicines that supposedly will improve health, but may actually worsen a person’s health.
3. Funeral or cemetery debts. Scammers contact a surviving spouse and claim that the deceased spouse owed money. Also, some “disreputable” funeral homes add unnecessary charges to a deceased spouse’s funeral bill.
4. Fraudulent anti-aging products. Scammers offer products that will supposedly give seniors a “youthful” appearance.
5. Telemarketing calls. The most common fraud where strangers ask seniors to send money or give financial information for a number of reasons, whether it’s giving money to an unknown charity or paying postage for a “free” gift.
6. Internet fraud. Adults of all ages are victims of this fraud, which involves a scammer tricking a person to get personal identification and financial information.
7. Investment schemes. These schemes offer low- to no-risk investments into financial products that will allegedly yield high returns. Unfortunately, you will never see a return on your investment because the scammers will have taken your money.
8. Homeowner/reverse mortgage scams. Fraudsters offer to help a senior obtain a reverse mortgage but actually steal the equity from the senior’s home. In a similar scheme, scammers claim they can help seniors’ lower their property taxes by having their property value reassessed.
9. Sweepstakes and lottery scams. The callers notify seniors of winning a sweepstakes or lottery (that seniors usually have never entered). Before receiving the prize, however, seniors are asked to wire money to pay a tax, fee, or other charge associated with the prize. Scammers might also ask seniors for their bank account information to deposit the alleged prize money.

There are many other scams that target older adults. AARP has a Scam-Tracking Map that allows you to find out about existing scams near you. The link to the map is provided below.