We all know that there are a number of schemes and scams which target elderly people. How can we protect ourselves or our loved ones from the plans of scumbags and conmen? Awareness can make us less likely to be targets. After all, conmen are generally going after the easiest “marks”– the fruit which hangs lowest on the tree.
With that in mind, let’s consider some common scams which target the elderly. My primary source for this series is the Texas Office of the Attorney General, which details a number of scams on their website.
I. Advance Fee Scams
How it starts: You receive a call or an email. The person on the other end is friendly and personable, and is pleased to inform you that you are eligible for a government grant, a loan, an inheritance, or some other reward.
The catch: There is no reward. The caller is either trying to get your personal information (credit card info, bank accounts, etc) or will try to solicit some kind of up-front payment to get the prize. They may frame this as an investment, taxes, or shipping fee.
Common variations: The “Nigerian Prince” scam has entered popular culture as the archetype of this system, however numerous other versions abound.
How it starts: Have you ever gone fishing in a pond or river? Think about how you do it– either throwing bait out and letting it sit under a bobber, or imitating something with an artificial lure until you can hook a big fish. In this scenario, you are the big fish. You receive a call, email, or text asking for personal information. This is the bait!
The catch: Don’t take the bait! Much like those artificial lures you use for fishing, successful scammers may imitate legitimate institutions such as banks or government entities. Always be wary of random requests for personal information. Try giving your bank a call or even popping down to your local branch to ensure that these requests are legitimate.
Common variations: As you can probably tell, one of the most common ways this scam works is by imitating an email or call from a bank or credit card provider. Always independently verify that such requests are legitimate before giving any personal information.
III. The Long Game
How it starts: Someone who seems trustworthy promises you a new business opportunity or investment with unimaginable rates of return. It’s so fantastic that it almost seems too good to be true, but the contact is quick to allay your fears. They seem so knowledgeable and nice, how could anything go wrong?
The catch: Unfortunately, new financial opportunities that promise unreasonable returns are oftentimes either Ponzi schemes or pyramid schemes. Conmen are good at figuring out something you want, then metaphorically dangling that thing in front of you. For many people, that “thing” will be financial success and independence. A talented scam artist will narrow down their target’s prime motivations, then focus on those motivations in such a way as to manipulate the target’s emotions and interest.
Common variations: Ponzi schemes, named after Charles Ponzi, are simple in concept but may be incredibly complex in execution. These systems are generally based around using money from subsequent investors to pay off the initial ones, creating a feedback loop which allows them to siphon off an incredible amount of money over a period of time. Bernie Madoff is probably the most famous modern example of this system.
Pyramid schemes are conceptually similar to Ponzi schemes but typically differ in execution. A pyramid scheme involves roping in larger and larger numbers of investors, with profits flowing to the “top” of the pyramid (please see the diagram here). This system typically becomes unsustainable over a period of time, as new prospects will struggle to find marks to loop into the scheme.
Concepts and Conclusions
Building confidence is the foundation of a confidence man, right? If they were bad at conning people, at making you trust them… well, they wouldn’t be very successful as conmen! Scammers will play on your emotions, including fear, greed, and hope in order to soften you up. They may try to create a sense of urgency– time sensitivity– or even present the situation as an emergency in order to sow panic and prevent you from thinking through the situation logically. Scammers will engage in a variety of manipulative tactics in order to place their target in a suggestible state, and these may include both promises of a reward and threats of punishment.
Look at the person’s actions. Did they call you out of the blue to ask for money? If you’ve known them for a while, do they only call when they want something? Are they trying to extract money from you, with or without the promise of reward? They may be a scammer!