Every year, millions of Americans become victims of scams at a cost of untold millions of hard earned dollars and in some cases, wiping out retirement savings. Scams like these are horrible for anyone to experience, but they are especially devastating for senior citizens.
"It's a terrible thing when anyone is a victim of a scam, but it is especially egregious when an elderly person is victimized in this way", said Attorney Connelly. "Imagine if you have just retired and all you have in life has been taken from you by one of these con artists. It's not only devastating, its life altering and most seniors just cannot recover from it."
In our blog this week, we will look at some of the "tried and true" scams that never seem to go away along with some newer ones that are popping up. Some of these scams are seasonal, like the home improvement scams while others, like jury duty scams, can occur at any time of the year
Let's take a look at some of the scams that can be aimed at anyone but tend to target seniors:
MEDICARE CARD SCAM
Let’s start off with a relatively new scam which we discussed some months ago as
the new Medicare cards began arriving in the mail of seniors and those on SSDI. The old cards, which contained the user’s social security number as their Medicare number, was a source of fraud and financial abuse for decades.
However, it appears the federal government did not do such a good job in making it known that the replacement was happening. This was verified by an AARP survey that found less than 25 percent of Americans over the age of 65 knew about the plan to replace these cards.
Even more distressing, that same AARP survey also found that over 6 in 10 seniors thought they would need to pay for the new cards. This is not true as the cards are free. Given the lack of knowledge that the AARP survey found about Medicare’s card change, is it any wonder that scammers have devised a whole host of ways to separate seniors from their finances.
Let’s look at a couple of the games:
A senior receives a call from a scammer claiming to be from the social security administration’s Medicare division. They asked if they received their new card yet and just to be sure, they ask that the senior “verify” their social security number. Once they get your number, the fraud is under way.
Callers will speak to a senior and state that a processing fee is required. With 60 percent of older American’s believing they need to pay for these cards, the scammers have a 6 out of 10 chance of making a score – not bad odds! If the senior asks how to pay for the card, the scammer will request the bank account information.
Scammers will tell the senior that a refund is due to them from their old Medicare card and account and that they need their bank account to make the deposit for them.
Some areas of the country are reporting that scammers are calling and stating that throwing away old Medicare cards “opens” them up for fraud and instead offers them an address to mail them to where they will be “safely disposed of”.
These scams start primarily on the phone with the con artists stating that they are calling from Medicare and need to “confirm information” before the cards are sent to you.
"Medicare will never call you out of the blue; they will never call you uninvited," said Jack Cheevers of the U.S. Centers for Medicare and Medicaid Services. "If they call you and threaten to cancel it, that's a scam. If they call you asking for your information, that's a scam."
Further, the cards will be sent to you automatically. There is nothing you need to do but destroy your old cards once the new ones are in your hand – and remember, your social security number is on those cards so make sure they cannot be read before you dispose of it.
Below is the mailing schedule of the new Medicare cards:
THE INTERNAL REVENUE SCAM
You suddenly get a phone call from someone claiming to be from the IRS. They state that unless you “pay back taxes owed” you will be arrested and put into jail. Sounds legitimate except for one thing, the IRS does not do business this way.
These scammers bank on the fact that most Americans’ contact with the IRS consists of completing their income tax form and waiting for a refund check to come. That’s it. When someone receives a phone call and is threatened with arrest, fear interferes with rational thought.
“To make things even more frightening”, says Attorney Connelly, “is the use of a computer spoofing program that makes the caller ID number appear to be coming from Washington, DC. This adds legitimacy to the phone call and elevates the scam to another level.”
Remember, the IRS does not:
Call to demand immediate payment – especially using methods like prepaid debit cards, gift cards or wire transfers. If taxes are due, the IRS sends out a bill or a notice using the mail.
Demand immediate payment without allowing the taxpayer to contest the amount in question.
Threaten to bring in local police, immigration officers or other law-enforcement officers to have someone arrested for not paying back taxes. The IRS also cannot revoke your drivers license, business licenses or immigration status. These are common tricks to get the caller to fall for the scam.
THE JURY DUTY SCAM
A senior gets a call from a person stating that they are from the sheriff’s department. If the person on the other end of the call stays on the line, the scam will proceed in one of two ways:
The scammer will state that they are updating their records for jury duty and requests the person’s social security number, birth date or even other credit card numbers in order to make sure the “government records” are current, or:
The scammer will state that they are following up on a warrant issued for the person’s arrest because they missed a jury duty date. They will then be told that a police officer will respond to their location and arrest them and bring them to jail – but – if they pay the fine over the phone, their will be no problems. They will then proceed to request bank account numbers, social security numbers, etc.
The reality, court workers will never request such information. If you have an issue with the courts, in most cases a letter will be sent to you. Remember, never give away personal information to anyone.
HOME IMPROVEMENT SCAMS
Home improvement scams seem to hit the scene in late spring and early summer and once again in late fall and early winter. They usually target the elderly and use scare tactics to force a repair be made immediately. With the onset of the solar panel industry, a new wrinkle in scams have occurred. Read below:
The Driveway Scam
A contractor will pull up in the driveway and offers the senior to repave the driveway at a “major discount” if cash was paid today. They promise to come back the following morning but never show up.
In another spin on this scam, the contractor states that they had ordered “too much” material for the job they did around the corner. So as they were driving by, they just happened to notice that the driveway needed work.
Rather than “dump” the extra materials, they offer a major discount. Once the amount is paid, the crew will go to work, but do a shoddy job and disappear. IN almost all cases, the damage down by these scammers result in the homeowner needing to pay for a major repaving job.
Security Alarm Scams
The scammers will show up at your door and state that the police had suggested he make calls on the neighborhood due to the high amount of crime that has been occurring in the area. They may pull out a newspaper with stories or even have printed up a realistic looking police report for the homeowner to read. Once the homeowner shows interest, a contract is pulled out with printing so small that the senior cannot read it, but out of the goodness of his heart, he will read it for them.
Again, the contractors don’t happen to pick on seniors by accident. These people scan the neighborhood and know who to go to. They tend to pick out retirees who may be immigrants or who have English as a second language.
The Solar Panel Scam
You get a visit from someone who offers to lower your energy bills through the free government program called PACE (Property Assessed Clean Energy). Now, although you will pay some “small” upfront costs (installation and cost of the panels), they guarantee you will make money over the next 20 years by selling excess energy back to the local supplier.
Some of the problems with this include poor workmanship with panel installation, including roof damages and the panel technology, in many cases, also requires an upgrade of other things in the home like water heaters, air conditioning systems, new windows, breaker boxes, etc.
Then comes the costs of the PACE loans, which were misrepresented by the contractors. In one case, contractors reportedly signed up elderly consumers for PACE loans without their knowledge, without providing documentation, and also without advising the consumers that an increased tax assessment will be placed on their homes due to the panel installation.
During our research regarding these loans, we found complaints that elderly individuals with dementia, or who were on medication, were entered into electronic PACE loan contracts they never saw, on terms they did not understand. Several have reported that “sales” were made on cell phones or tablets and that they never saw or signed a document or had paperwork regarding the sale.
Some individuals were not provided any documentation until well after they were entered into a tax assessment agreement. We are concerned that these same individuals will eventually be at risk of foreclosure, terrible at any age but especially for an older individual with minimal resources.
THE GRANDPARENT SCAM
A senior will receive a call from someone who says it is their grandchild. They usually speak in a low voice or whisper, partly to add legitimacy to the scam but mostly to help disguise the voice. They state that they have been arrested for a variety of offenses and are scared to tell their parents. They say they need money wired to them to make bail.
The typical take on this scam is anywhere between $3,000 and $4,000. There’s even a ‘reload’ on this one. If the scammer gets money, they’ll have another person call up impersonating a police officer and ask for additional funds in order for their grandchild to be released. They claim there are extra charges for property damage. Once the money is taken, you’ll never see it again.
THE ENERGY SCAMS
The energy scams become more “energetic” during heat waves or cold snaps. Again targeting seniors (or just about any homeowner in some cases), the cons are banking on residents wanting to save money or stay safe during weather conditions that could pose a health threat. Let’s review a few below:
Some people show up at your door dressed like power company employees complete with multiple ID badges hanging from their necks, none of which are from your energy supplier. But they sure do look official. Then they tell you they can save you 20% or more on your bill. Sounds good and you sign the paperwork.
But after a brief introductory period, rates may suddenly skyrocket — and you find yourself locked in a long-term contract with high cancellation fees. Attorney general offices in several states have sued energy suppliers for such bait-and-switch practices.
Your best bet: If you're interested in switching energy suppliers, avoid unsolicited offers and instead compare your options at your state's PUC website.
The Shut-off Scam
This is by far the most common scam. Someone calls stating they are from the local power company and warns the senior that they are about to have their service shut-off. Scammers usually pick the oldest time in winter or the hottest weather in summer, times they know seniors will be most affected by the weather and scared for their health.
They offer to settle the over-due bill immediately on the phone by using a credit card number or a pre-paid debit card. But you should know that most utilities will mail at least one, if not several, past-due notices before terminating service. If you get a cancellation notification (especially by phone), always verify it by dialing the customer service number on your utility bill. Don't give any information to the caller.
The Energy Auditors
Again, utility company imposters come to your door and offer a free “energy audit”. They come in and walk through your home, checking windows, doors, etc. They may rob you using two methods – they come in pairs and as one keeps you busy, the other robs your jewelry or other valuables. Or, they look for weaknesses or ways to enter your residence when you are not home – setting you up for a burglary.
HOW TO KEEP YOURSELF SAFE
Once you or a loved one is the victim of a scam, it becomes a major crisis in their life and often very time consuming to get out of the problem. The most important thing is to be aware of possible scams and avoid becoming a victim.
Approach every deal with suspicion. In most cases, scrupulous businesses do not cold call or send unsolicited letters or emails promising huge benefits or ways to make money.
Know how to stay safe on the web. Go to businesses that you know or businesses that have physical addresses. Avoid those with just PO Boxes. Do not respond to emails that request your bank numbers or social security numbers. Also, do not respond to emails asking you to reset your password because “suspicious activity was detected on your account”. Follow up with a phone call to the account and ask them about it. Also make sure you spam setting is set at high.
Familiar-looking numbers are the latest twist in robocalls and scam artists. It’s the latest scam known as neighbor spoofing. Using “spoof” software, the may claim they are from the IRS using Washington DC area codes, etc. Do not fall for it.
Never give out personal information. Any company or charity that asks you for social security numbers, credit card numbers, account numbers, etc. are probably scammers.
Do not make impulsive decisions. If you allow a telemarketer to “pull you along” and then he or she tries to pressure you into an immediate decision, hang up the phone. Never pay for anything until you have done your research and talked it over with another person.
Check with the Better Business Bureau. This organization is a great tool to find out information on local businesses. If a company isn’t registered with the Better Business Bureau, they could be a scammer. A quick Internet search might also turn up information from people who have been scammed by a similar scheme.
Do not pay anyone on a promise of winning a prize. Someone may call you and promise a prize and will deliver it to your bank account, they just need your account number, your routing number and even more information. This is often called pay to play. Do not fall for it.
Think of others that you can help. Perhaps you have been a victim of a scam. It hurts, it may seem embarrassing, and you may not want to admit t it. But remember, it has happened to a lot of people who are trusting, caring and smart. Its easy to fall for a good story. But coming forward is important because it allows the local authorities to be aware of possible scams and save others from a similar fate.
We at Connelly Law recommend that you print out our scam sheet (however it does not contain every scam as these people spend 24/7 figuring out ways to separate seniors from their money) and explain to loved ones some of the ways these people work and suggest the following techniques to help them avoid potentially devastating thefts:
The bottom line is this – you cannot always protect yourself or your loved ones from scams and fraud, but you can put things into place to reduce the likelihood that you will become a victim of a con artist. The bets rule of thumb is following the advice of an old but true saying – if an offer seems too good to be true, it probably is.
And one other thing, although it may seem wrong to be suspicious of a charity or non-profit organization, it’s always in your best interest to be suspicious and ask questions. A legitimate fund-raising campaign will have no problem answering your questions, including how the money raised will be spent.
And always – ALWAYS – know who you are dealing with before sharing any personal information or sending them money.
If you think you have been a victim of a scam, Connelly Law can help. We provide expert legal help for those who have been victims of financial crimes and fraud. We can also provide professional fiduciary services and daily money management services where we monitor your account and pay your monthly bills. This service is available to seniors, those with special needs, businesses or to anyone who’s life is just too busy to stay up to date on monthly bills and accounts.
Call us at 1-855-724-9400.
Attorney Connelly practices in the area of elder law. This area of law involves Medicaid planning and asset protection advice for those individuals entering nursing homes, planning for the possibility of disability through the use of powers of attorney for the both health care and finances, guardianship, estate planning, probate and estate administration, preparation of wills, living trusts and special or supplemental needs trusts. He represents clients primarily in the states of Rhode Island, Connecticut and the Commonwealth of Massachusetts. He was certified as an Elder Law Attorney (CELA) by the National Elder Law Foundation (NELF) in 2008. Attorney Connelly is licensed to practice before the Rhode Island, Massachusetts, Connecticut, and Federal Bars.