FBI Reports U.S. Seniors Lost $3.4 Billion from Scams
- The elderly are becoming favored targets of fraudsters
- An FBI report reveals "astonishing" numbers
- International scammers are now prevalent
Unfortunately -- and not unexpectedly -- fraudsters are taking aim at older Americans. As CBS News reports, "Elder Fraud" is becoming more and more popular. According to the FBI, older Americans were targeted more frequently last year than during any other year, accounting for an estimated $3.4 billion in total reported losses.
Reports of criminal schemes targeting seniors in the U.S. increased by 14% between 2022 and 2023, federal investigators said, warning that investment scams in which victims are enticed into transferring money to fraudulent financial institutions are the costliest to the elderly. In all, over 101,000 complaints of fraud perpetrated against individuals over 60 years of age were filed to federal law enforcement last year, the most of any age group throughout the country.
While the FBI reports over 101,000 complaints, the number of fraud incidents is substantially higher due to the fact that many are going unreported:
A majority of elder fraud scams go unreported to law enforcement by the victims, which officials have said makes it difficult to quantify the total impact of the crimes nationwide. AARP estimated in a 2023 study that $28.3 billion is lost to elder fraud scams each year, 72% of which is taken by individuals who are known to the victims.
Financial Institutions Need to "Step Up"
In the article, the FBI are looking to financial institutions to "step up" and do more to help stop these money transfers and becoming victims.
The officials said Tuesday they hoped the new report will both shine a light on fraud schemes and prevent future victims from falling prey to illegal scammers. Education and "tough conversations" with America's senior populations will be key to these prevention efforts, they said, highlighting that the earlier fraud crimes are reported, the better chance law enforcement has at preventing money transfers and stopping criminals before they complete their schemes.
During the recent Elder Fraud and Fraud Roundtable workshop at the New England Automated Clearing House (NEACH) Payments Management Conference, OrboGraph's Marketing Manager and Fraud Detection Specialist, James Bi, heard various accounts from participating financial institutions.
It was tough hearing the first hand accounts from these fraud professionals. They detailed several different stories ranging from romance scams to relatives seeking help in dire situations in another country while on vacation. Many of these victims lost tens of thousands of dollars. What was really disturbing is that some of these financial institutions did try and intervene, with tellers trying to ask questions but getting vague responses or the simple "I can do what I want with my money," only to come back a week later asking for help to recover the funds. There were even a few instances where the victims took their own lives.
While a portion of these scams involve checks, including victims drawing from their accounts for certified checks and the over-payment scam, there is not a technology out there that can prevent these scams. The only way for this industry to reduce the losses and number of victims is for bank professionals to remain vigilant and, as financial institutions are trusted to protect their customer's funds, providing as much education as possible to seniors -- whether its online, mailed, or hosting education events.