Exploitation of Seniors

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Exploitation of Seniors

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Police: Fraud and Financial Exploitation of Seniors

SeniorFraud is big business in America, taking in about $100 billion a year according to the U.S. Office of Consumer Affairs. Law enforcement officials believe that seniors are among the most commonly targeted customers. Older Americans don’t think of themselves as gullible, but wisdom and experience may not be enough to protect people from the thousands of fraudulent businesses. Social workers, attorneys and law enforcement have identified the following four reasons that seniors are at greater risk of fraud:
More Leisure Time:
Longer life spans and earlier retirements sometimes translate into empty hours. Some seniors fill them with reading the mail and taking phone calls and visits from strangers offering “money saving deals,” “can’t miss” investment opportunities and “big cash prizes.”

Alone and sometimes in failing health, seniors may respond warmly to crooks who may be the only people to call or visit them.

Many seniors worry about running out of money or not having any cash to leave to their children.

More Discretionary Income:
While seniors may not be at the top of the list in terms of yearly income, they may have a greater percentage of their income not automatically taken up by the expenses of a growing family, college tuition, and so forth.

The following are some of the most common types of consumer scams aimed at senior citizens. To learn more about how to protect yourself or loved ones, click on the links below.

Information on other consumer topics can be found in our Consumer and Publications sections.

Telemarketing Fraud

Telemarketing fraud is costing Americans about $40 billion a year. The FBI estimates that approximately 10 percent of the nation’s 140,000 telemarketing firms are fraudulent, and nearly 80 % of the crooked companies target seniors. Today’s con artists have learned to use the telephone to promote confusion and deceive seniors. Telephone shopping is so popular with Americans that con artists recognized an opportunity to swindle seniors. Like burglars stealing through the night, they use telephones to become “invisible.”

Remember: Fraud is a serious crime, and illegal telemarketers are crooks.

Common Telephone Scams

Prize Offers:
You usually have to do something to get your “free” prize such as attend a sales presentation, buy something, or give out a credit card number. The prizes are generally worthless or overpriced.

Travel Packages:
“Free” or “Low Cost” vacations can end up costing a lot with all their hidden costs, or they may never happen. The total may run two to three times more than what you’d expect to pay or what you were led to believe.

Vitamins and Other Health Products:
This sales pitch also may include a prize offer. In many cases, you pay much more than what the product is worth and your prize may be of little value if you actually receive it.

People lose millions of dollars each year in “get rich” schemes that promise high returns with little or no risk. These turn out to be worthless or worth much less than what you paid.

Con artists often label phony charities with names that sound like better-known, reputable organizations.

Recovery Scams:
If you buy any of the above scams, you’re likely to be called again by someone promising to get your money back. Be careful not to lose more money to this common fraud.

Indicators of Telemarketing Fraud

An unusually large number of telephone calls to a senior’s home.

Many packages arriving at a senior’s home.

Quantities of vitamins, magazines, and other products stored in a senior’s home.

People arriving at a senior’s door to pick up checks or cash.

Telephone calls informing a senior he/she has won a free vacation, gift, or prize and all the senior has to do is pay postage and handling charges.

A senior is told he or she must act “now” or the offer from the telemarketer won’t be good.

While on the telephone, a senior gives the telemarketer his/her credit card number or bank account number.

To Avoid Being Swindled:

Don’t buy from unfamiliar companies. Ask for written information about any offer.

Always take your time making a decision. Consult a family member, friend, accountant or others you trust.

Never send money or give out your credit card or bank account number unless you are absolutely sure the company is legitimate.

Always be suspicious of companies that ask you to send payment by courier or overnight service.

Always be suspicious of companies that claim you have won a “free” gift, vacation, or prize and you pay only for “postage and handling” or other charges.

Under New Federal Trade Commission Rules:

Telemarketers cannot call before 8:00 am or after 9:00 pm.

Telemarketers must provide their name, the company they represent, and a phone number where their company can be contacted.

Telemarketers cannot provide misleading information about their product or service.

You may notify telemarketers that you do not wish to be contacted. They are required to keep lists of people who request that they not be called.

Home Repair Fraud

Seniors, especially those who live alone, are prime targets for home repair rip-offs. Some so-called repair contractors, particularly those who operate from door-to-door, may charge prices that are unfair and unreasonable. Some con artists propose offers that sound too good to be true, but they use inferior materials or they don’t do the job at all. In some cases, con artists pose as inspectors, city officials or police and use scare tactics to force you to have unnecessary repairs made on your furnace, chimney, water heater or the electrical wiring in your home. Fraudulent operators may even damage these and other areas of your home, and then they try to sell you repairs. Some phony repairmen might also pretend they are inspecting an area inside of your home, when actually they are busy robbing you of cash or other valuables.

If you or a family member think you have been defrauded by a contractor, call the Attorney General’s office. While this office will not be able to represent you directly, it is possible in some circumstances that a settlement can be negotiated or restitution obtained. The Attorney General’s office will also be in a position to protect other Illinois citizens who may be the targets of a dishonest contractor.

Indicators of Home Repair Fraud

A salesperson, with no local connections, comes to a senior’s door and offers to do home repair work for substantially less than market price.

A salesperson comes to a senior’s door saying the senior needs siding, storm windows, or other home improvement. The salesperson also wants the senior to sign a contract on the spot. The signing of this type of contract may mean hidden finance charges or a lien placed on the home.

A worker comes to a senior’s door and tells the senior that his/her roof (driveway, chimney, or furnace) has a problem. He claims he has extra material from a job and can do this job at cost. If the work done is done, it will probably be incomplete, poorly done, or overpriced.

A contractor comes to a senior’s home and offers to inspect the home for free. There is probably a catch to this offer.

A contractor comes to a senior’s home and has a business card which doesn’t include an address.

A contractor who insists on a cash deposit or full payment.

A contractor who offers to drive the senior to the bank to withdraw funds to pay for the work.

Avoiding Home Repair Fraud

Never let a door-to-door sales or repair person inspect any part of your property. Ask for identification and phone their office to verify who they are.

Make sure your home really needs repairs.

Get at least 3 estimates in writing.

Get a list of references and check them out.

Don’t contract to have the work done immediately.

Do not sign a contract that has blanks. Have a friend, relative or attorney look over the contract.

Do not sign a completion certificate until the work is complete.

Do not make final payment unless you are satisfied with the work and the contractor has paid all sub-contractors. Get lien waivers.

By law, you may cancel any contract and get a full refund any time in the first 3 days.

(This applies only to unsolicited contractors who convince you to have certain jobs done).

Sweepstakes, Prizes, and Contests

“You’ve won a prize!” Those may be the first words you read when you open your mail or answer the telephone. Fantastic prizes such as: a vacation for two, a new car, or even 10 million dollars could be yours. Americans have become accustomed to ads showing people winning millions of dollars in sweepstakes or lotteries that are actually legitimate. Sweepstakes and contests can be marketing tools for reputable companies, but there is much fraud under the guise of sweepstakes. Many prize offers have strings attached. Typically, you must purchase something, pay a fee, or agree to pay a shipping and handling charge in order to receive your “prize.” In most cases, the value of the prize is greatly overstated.

Remember, if you’ve really won a prize, you’ll get it absolutely free, with no strings attached.

Important Facts to Know

Official sounding names are used such as “Audit Central Bureau Disbursement Center” or “National Prize Center.”

Official looking features are used such as “Award Claim Number: ............”

Some companies use names that sound like other well known sweepstakes organizations.

Small print is often used giving you information the company hopes you won’t read. You may be signing up for magazines, vitamins, or some other unwanted item. You might even be giving permission to change phone carriers.

You may be told to call 1-900 number phone call to collect your “prize.” Remember, you pay for 1-900 calls.

You may be asked to give a credit card number or bank account number.

The prize is probably worth very little.

You may be asked to send money by messenger.

You may be asked to pay for “shipping and handling.”

Your chance of winning a truly valuable prize through contests or sweepstakes are very slim.

Indicators of Sweepstakes, Prizes, and Contest Fraud

A large amount of junk mail lying around in a senior’s home.

A senior receives frequent telephone calls from strangers.

Frequent stops to a senior’s home by couriers to pick up checks.

Many packages arriving at a senior’s home.

Quantities of vitamins, magazines, junk prizes, and other products stored in a senior’s home.

Senior gives out credit card number or bank account number on phone or to salespersons.

Financial Exploitation

As some seniors experience loss of driving ability and personal mobility, they become dependent on others to assist with and sometimes take over financial matters. Although this increases the opportunity for abusive practices, care-givers and others (lawyers, bankers, relatives, friends, etc.) may have a need to conduct legitimate financial business or handle funds in order to provide care to the person. Unfortunately, sometimes a care-giver, relative, a helpful neighbor, or repairman can become familiar with a senior’s finances and slowly begin to take larger and larger amounts of money as the senior becomes more frail.

Indicators of Financial Exploitation

A care-giver seems overly interested in the victim’s financial situation, or a care-giver has no means of support.

A care-giver or family member with access to senior’s money appears to use the funds for themselves rather than for the senior, resulting in numerous unpaid bills or overdue rent, for example.

A senior doesn’t have adequate food, clothing or personal care items when there appears to be enough money to provide them.

A senior is greatly overcharged for services such as auto repairs or mowing the lawn.

A senior doesn’t receive services he/she has already paid for.

A senior loans large sums with no arrangement for repayment.

Relatives or new acquaintances have moved in with a senior.

Items continue to be missing on a regular basis from a senior’s home.

Suspicious activity on a senior’s credit card accounts.

Bank statements and canceled checks are no longer going to a senior’s home; all mail has been re-directed to a different address.

A senior is not aware of or does not understand recently completed financial transactions.

Suspicious signatures on checks or other documents belonging to a senior. 

Junk Mail and Unwanted Phone Calls

Do you feel overwhelmed by the flood of junk mail and telemarketing calls you receive? Experts estimate that Americans receive almost two million tons of junk mail every year, with the average person spending eight full months of his/her life just opening it. Telemarketing calls are also time-consuming and irritating.

You can reduce the amount of junk mail you receive by requesting that your name be eliminated from large mailing lists which are sold to direct mail marketers. Your name will usually stay on the removal list for five years, then your name may be registered again. Send your name and address to:

Mail Preference Service
Direct Marketing Association
P.O. Box 9008
Farmingdale, NY 11735-9008

To reduce the number of telemarketing calls you receive, send your name and telephone number (including your area code) to:

Telephone Preference Service
Direct Marketing Association
P.O. Box 9014
Farmingdale, NY 11735-9014