By:  Melissa Pennuto

“You’ve won the lottery!”
“Your bank account is overdrawn/hacked!”
“Your taxes are overdue!”
“Your roof is damaged!”
“Hi, grandma!”

These are just five of the innumerable scams that millions of people, ONE-in-FIVE seniors age 65 and older, are hit with every day.  Unfortunately, so many seniors hear these statements and are either too excited or too embarrassed to talk with their support systems prior to sending money as requested.  Many organizations who are being fraudulently represented by scammers are taking action to post on their websites or in the paper to beware of scams.

Still, we take for granted that many of our elders do not know or are simply unable to look up whether these calls are scams before they respond.  As advisors, it is our responsibility to educate our clients of the scams before they get the call.  Here are some of the many examples of what is out there today, and what we can do to protect our clients.

Scam 1: You’ve won the lottery!
Everyone wants to get this call, if only it were true.  These calls are coming in over the phone, via email, and via direct mail, and mention both U.S. and foreign lottery winnings.  First and foremost, we need to remind ourselves that we cannot win a lottery if we do not buy a ticket.  This seems logical, but so many seniors get caught up in the excitement of finally getting the call that they are willing to provide account information for direct deposit, or wire money to pay taxes or fees in anticipation of a big payout.

Further, many lottery companies have indicated that they will not call their winners to alert them of the prize (See for example, the website of Mega Millions.)  The Federal Trade Commission (“FTC”) also wants us to be aware that if you do play a foreign lottery, you are violating federal law.

Scam 2: Your bank account is overdrawn/hacked!
A dear loved one of mine was “had” by this scam a few years back.  The caller claimed that he was from her bank, informed her that her account was overdrawn, perhaps hacked, and that she needed to withdraw money from another account to set up a new, separate account in order to protect it from future problems.  She withdrew $5,000 in cash and, as the caller requested, she took it to a local mall to hand-deliver to a man who promised to make the deposit for her.  She realized her mistake while driving home, but it was too late.

This scam comes in many forms, sometimes from emails simply suggesting that your account was hacked, and containing links for you to click on that take you to a page to enter in identifying information to show that the account is really yours.  On the other side of that webpage is a hacker, gaining access to your accounts using the information you are entering as you type.

Suggest to your clients to not click on links from an email; always go to the webpage directly in a separate window.  Be cautious of emails that do not show a familiar email address in the “From” or “To” fields.  When it comes to phone calls, never provide banking information to anyone over the telephone, and do not take money to a stranger.  Visit your local branch or call the 1-800 number on your bank statements to sort out any bank-related issues.

Scam 3: Your taxes are overdue!
This scam is starting to gain recognition among consumers through regular posting only and features on news broadcasts.  Still, seniors who do not have access to, or miss, these mediums may be unaware that the phone calls are not really from the IRS, the state, nor the county collector.  Most of these scams are taking place over the phone, and are resulting in hundreds of thousands of dollars of lost funds for our seniors.

What is important to communicate with your clients is that none of these groups will contact you over the phone about outstanding taxes.  All notices are sent in the mail, or if they are tremendously overdue, via process of service.

Scam 4:  Your Roof is Damaged!
Last week, there was a freak hail storm which produced golf ball size hail that damaged cars and houses.  Didn’t you hear about it?  Your roof is showing some damage that can be fixed by X Company, and upon your deposit, they will fix your roof.  Then, they will submit their claim to your insurance company and will reimburse you your deposit upon your insurance company’s payment.  So, you pay the deposit, expect the Company to start Monday morning, and they never show. Surprise, surprise, the phone number they provided to you is no longer in service.  This scam most often happens in person, and the work to be performed varies dependent on what best services the scammer’s timing.

Sometimes, the scam is stealthier, were they work in pairs and one person gets you out of your house to look at the damage around back while the other goes in to clean out your top dresser drawer (because surely you didn’t have your keys on you when you answered the door to lock up behind you when you exit).  Chances are that by the time you realize what really happened, you do not remember if the person you talked to was blonde or brunette.

To protect your clients from these types of scams, simply suggest that they do not open their door to strangers, and certainly not to exit the house, nor allow the stranger inside.  If they are not expecting company, chances are high that the people coming to the door are those wanting to influence your client in some way.

Scam 5: Hi, grandma!
There are two versions of this scam:

Version A:  A scam artist calls you and starts off with, “Hi, grandma!  Do you know who this is?”  Grandma, being unsure, names one of her grandchildren, “Is this Becky?”  And off to the races the caller goes.  “Becky” is great at small talk.  Ultimately, though, she wants to discuss her current financial emergency, one in which “Becky” may be in danger, and desperately needs grandma to wire her money so that she can get home and hug her grandma.  Unfortunately, Becky will never receive that money, nor is it likely that Becky is in danger.

We have to let our clients know that it is okay to verify that whoever is calling is the real person they are claiming to be, even when their instinct is to help their loved one.  Some ways for them to do this is to check caller ID to look for a suspicious number, to call them back on their real number, or to check with their parent or friend to find out if any part of the story is legitimate.  If possible, have your client offer to send someone to pick the loved one up from wherever she is stranded, or to pay certain bills directly.  Suddenly, “Becky” will no longer be a concern.

Version B:  Becky called, the real one this time.  She desperately wants money to buy a new car, or she wants you to add her as an owner on your bank accounts to help you pay your bills.  This is difficult, and may be of several relations to you – your granddaughter, daughter, niece, next door neighbor, or even president of your garden club.  They all seem legitimate, but unfortunately over 50% of all offenders of financial exploitation are those that we trust the most.

As advisors, it is so important that we keep our eyes out for anyone who may wish to harm our clients.  Require that all changes of ownership or major gifting be handled in person, and be sure to discuss individually with the client when the other person is not in the room.  If you suspect bad intentions, do not allow the changes to happen and inform your legal department.  If you witness large or voluminous unexplained withdrawals, report the situation to the elder abuse hotline, to your legal department, and to your client’s attorney, as needed.

What to do if Your Client is a Victim
Unfortunately, many of our clients will still fall into a trap at some point.  Moving forward, we must help them to understand that they will likely receive a second, third, even tenth phishing call, as fraudulent telemarketers place your client’s name and phone number on a “sucker list” that they sell to other groups just like them.  Though it may seem extreme, recommending to your clients that they change their phone number may be the best option.  Make sure you express that your role as their advisor includes being available to suggest what withdrawals and deposits are in their best interests, in hopes that you may be able to help them avoid succumbing to the scam.

Do not be afraid to ask questions when they come to you requesting a withdrawal of any size – what is it for, why so much, where are you sending it, and what is influencing their decision.  Finally, help your clients file a complaint with the FTC for every scam you encounter, or file a complaint with the elder abuse hotline when you suspect a loved one is taking advantage of your client.

Staying proactive on both the offense and the defense will best serve not only your client, but also their family and community at large.