Although anybody can be a victim of financial fraud and scams, the older members of the population are particularly vulnerable and common targets.
As technology evolves and financial transactions become increasingly digital, scammers have adapted their tactics to exploit the trust, vulnerability, and often, the retirement savings of older adults. However, by understanding the methods used by these fraudsters, you will be in a better position to spot and prevent a suspicious interaction in its tracks.
What to watch out for
One of the key tactics employed by scammers targeting seniors is the exploitation of trust.
Many scams involve perpetrators posing as trustworthy figures, such as your bank, government representatives, financial advisers, lawyers, or even family members. They use these trusted identities to manipulate their victims into sharing sensitive information or making financial transactions under false pretences.
Recognising the warning signs of potential scams is essential in protecting yourself from financial exploitation. Some common giveaways include unsolicited and unexpected correspondence requesting personal or financial information; high-pressure tactics or urgent demands for immediate action; offers that seem too good to be true, such as guaranteed returns or prizes; and requests for payment via untraceable methods, such as wire transfers or gift cards.
What could a scam look like?
Several common scam techniques specifically target older adults, often taking advantage of their desire for financial security or their lack of familiarity with modern technology. These scams include:
- Phishing Emails and Calls: Scammers send deceptive emails or make phone calls posing as legitimate organisations, such as banks or government agencies, to obtain personal information or initiate fraudulent transactions.
- Investment Scams: Fraudsters promise high returns on investments or promote “get-rich-quick” schemes, persuading seniors to invest their savings in fraudulent ventures.
- Tech Support Scams: Perpetrators contact their victims claiming to be tech support specialists. They then convince them to grant remote access to their computer, which allows them to install malware or obtain personal information. This is particularly effective in older people who haven’t kept up with technological advances and are not particularly ‘tech savvy’.
- Romance Scams: Romance scammers cultivate romantic relationships with older people, usually online, gaining their trust before requesting financial assistance or exploiting them for money. It’s extremely common for these scammers to use the ‘gift card’ tactic we mentioned above, as they are untraceable and can’t be recovered. This method is also commonly used in money laundering, which could make you an unwitting pawn in major financial crime.
Protecting Against Financial Fraud
Here are some proactive steps you can take to safeguard your finances:
Verify Identities: Before providing personal or financial information, verify the identity of the individual or organisation contacting you, especially if they claim to represent a reputable institution. If you ever receive correspondence (usually a phone call) from somebody that you don’t recognise, about something as significant as your finances, ask for their organisation and insist that you will call them back. Legitimate organisations will have an established web presence and will never call you asking for sensitive information or significant deposits or transfers.
Secure Your Devices: Install and regularly update antivirus software on your devices, and be cautious when clicking on links or downloading attachments from unknown sources. Regularly change your passwords on your email and bank accounts, and set up Two Factor Authentication (2FA) where available. This extra step feels annoying when you’re logging into your accounts, but it could be the difference between protecting your money and losing it – more than worth the extra few seconds.
Guard Your Personal Information: Avoid sharing sensitive information, such as PIN numbers or bank account details, with unfamiliar or unverified individuals. Never share your passwords via text or keep them written down somewhere accessible. You can use a tool such as LastPass to securely store and share password information.
Seek Advice: Always consult your financial adviser before making any significant financial decisions or responding to unsolicited offers.
The tactics used by scammers are constantly evolving and, in many cases, becoming extremely sophisticated and convincing. If you fall victim to one, among the emotions of upset, betrayal, and guilt you may also feel embarrassment. However, it’s important to remember that anyone can be tricked and fall for a scam – that’s exactly what they are designed to do.
The best line of defence is knowledge. By understanding the tactics used by fraudsters, recognising red flags, and taking proactive steps to protect yourself, you can mitigate the risk of falling victim to these schemes and safeguard your hard-earned savings for retirement.
If you suspect you have fallen victim to a scam, you should notify your bank and your financial planner immediately, before reporting it at Action Fraud (the National Fraud & Cyber Crime Reporting Centre).
What next?
Working with a financial planner puts one more defensive step in place between a scammer and your money.
If you would like to learn more about putting together a financial plan to support yourself or a loved one, please don’t hesitate to get in touch with us on theteam@uniqfamilywealth.co.uk or 02920 782330.
Our phone lines are manned 9:00-17:00, Monday-Thursday. Please note we operate a four-day working week.