Financial scams are all over the news — from fake callers claiming to be from the Canada Revenue Agency to banks requesting security information by text message — financial scams are on the rise, particularly those targeting seniors. According to the Government of Canada, “fraud is the number one crime against older Canadians.”
The seniors in our lives have built their savings through a lifetime of hard work, but unfortunately with age comes greater vulnerability to abuse and criminal activity. Many seniors in Canada have a sizable nest egg which they are using to fund their retirement and it’s this combination of wealth and vulnerability that makes seniors a popular target for financial fraud.
How can you help protect the seniors in your life from becoming the next victim of a scam? Know the risk factors and be aware of common scams and how to prevent them:
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Criminals and professional scammers are most likely to target seniors who:
If a senior in your life meets any of these criteria, talk to them about how to recognize a scam and mention some of the popular scams that are currently circulating in your community.
While there are many different types of scams targeting seniors (and new ones being invented every day) there are a few basic types, ranging from the very simple to the more complex, including:
Some examples of common scams include:
Caller ID Spoofing
Some seniors rely on Caller ID to protect themselves from scam calls, but did you know that scammers can fake their caller ID? A fake caller ID can confuse seniors, who think that if the caller ID says CRA or their financial institution, then they must be talking to someone from that institution. This tactic can lead even the most suspicious seniors to unwittingly fall for one of the scams mentioned above.
Canada Revenue Agency (CRA) Scams
These are particularly common during tax time. The scammer will contact the victim and claim that there is an unpaid CRA balance that they need to clear. The object is to gain either money or personal information (birthdate, credit card number, SIN and other information). Note that the CRA will NEVER ask for any personal information. If someone claiming to be from the CRA contacts you then you should visit Service Canada immediately to verify the claim.
Counterfeit Prescription Drugs
Seniors looking for affordable medication online need to beware. Not all online pharmacy websites are reliable. In fact, the FDA has investigated many counterfeit drug scams that are operating on the internet. Not only are these counterfeit drug rings taking seniors’ money, they may also be providing them with fake or faulty medication that could cause serious physical harm. It’s best not to buy prescription medication online.
Door-to-Door or Telemarketing Scams
This is not a very high-tech scam. It involves someone claiming to represent a charity or company trying to either sell or “give” you something by using high-pressure bullying tactics. Sometimes the caller will tell you that you’ve won something. Remember that you can’t win a contest that you didn’t enter!
Ultimately, seniors should never feel pressured into making a purchase or fall for ‘limited time offers.’ It’s a good idea to consult with friends or family before making a purchase.
Grandchild (or Friend) in Need
A scammer contacts the senior via phone or email and pretends to be their grandchild or a friend. They then claim to be in dire need of money due to an emergency, legal trouble or while travelling. They will ask the senior to wire or send them funds. A second scammer may call to ‘verify’ the claim. Seniors should always be wary of such demands and reach out to trusted family and friends to verify any claims.
Reverse Mortgage and Investment Scams
Seniors who have a healthy nest egg or own their own home are particularly vulnerable to scams surrounding reverse mortgages – where they sign over their home’s equity to a stranger thinking that they’re just accessing the equity in their homes.
When it comes to investing, there are many scams out there – from pyramid schemes to “guaranteed” profits for an easy investment, seniors should be wary of promises to make quick money or of anything that seems to good to be true. It’s best to talk to a certified financial planner before making an investment or considering a reverse mortgage.
Scammers are always coming up with new scams, but these tips should keep you and the seniors you love safe:
For more help, information and resources about scams, visit these websites:
Have you or a senior loved one been the target of a financial scam? Share your stories with us in the comments below.