From: drarwingnuttephd@gmail.com   
      
   Financial Crimes Against the Elderly   
      
   Guide No.20 (2003)   
      
   by Kelly Johnson   
      
   Translation(s): Crimes Financeiros Contra Idosos (Portuguese) PDF   
      
   The Problem of Financial Crimes Against the Elderly   
      
   This guide addresses the problem of financial crimes against the elderly. It   
   begins by describing the problem and reviewing risk factors. It then   
   identifies a series of questions to help you analyze your local problem.   
   Finally, it reviews responses to    
   the problem and describes the conditions under which they are most effective.   
      
   Financial crimes against the elderly fall under two general categories: fraud   
   committed by strangers, and financial exploitation by relatives and   
   caregivers. These categories sometimes overlap in terms of target selection   
   and the means used to commit the    
   crime. However, the differences in the offender-victim relationships suggest   
   different methods for analyzing and responding to the problem.   
      
   Fraud Committed by Strangers   
      
   Fraud generally involves deliberately deceiving the victim with the promise of   
   goods, services, or other benefits that are nonexistent, unnecessary, never   
   intended to be provided, or grossly misrepresented. 1 There are hundreds of   
   frauds, but offenders    
   generally use a small subset of these against the elderly. The frauds   
   typically occur within a few interactions.   
      
   Prizes and sweepstakes. These frauds generally involve informing the victim   
   that he or she could win, or has already won, a "valuable" prize or a lot of   
   money. The victim is required to send in money to cover taxes, shipping, or   
   processing fees. The    
   prize may never be delivered or, if so, is usually costume jewelry or cheap   
   electronic equipment worth less than the money paid to retrieve it.   
   Investments. Because many seniors live on fixed incomes, they often want to   
   increase the value of their estate and ensure they have sufficient funds to   
   meet basic needs. In investment scams, offenders persuade the elderly to   
   invest in precious gems, real    
   estate, annuities, or stocks and bonds by promising unrealistically high rates   
   of return. The investments often consist of fake gemstones, uninhabitable   
   property, or shares in a nonexistent or unprofitable company.   
   Charity contributions. Playing on some seniors' desire to help others,   
   offenders solicit donations to nonexistent charities or religious   
   organizations, often using sweepstakes or raffles to do so.   
   Home and automobile repairs. Offenders may recommend an array of fraudulent   
   "emergency" home repairs, often requiring an advance deposit. They may   
   subsequently fail to do any work at all, start but not finish the work, or do   
   substandard work that    
   requires correction. Common frauds include roof repairs, driveway resurfacing,   
   waterproofing, and pest control. The offenders are often transient, moving   
   among neighborhoods, cities, and even states. Dishonest auto mechanics may   
   falsely inform customers    
   that certain repairs are needed, or they may bill for services or repairs that   
   were not requested or were not completed.   
   Loans and mortgages. Seniors may experience cash flow shortages in the face of   
   needed medical care or home repairs. Predatory lenders may provide loans with   
   exorbitant interest rates, hidden fees, and repayment schedules far exceeding   
   the elderly's means,   
    often at the risk of their home, which has been used as collateral.   
   Health, funeral, and life insurance. Many seniors are concerned about having   
   the funds to pay for needed medical care or a proper burial, or to bequeath to   
   loved ones upon death. Unscrupulous salespeople take advantage of these   
   concerns by selling the    
   elderly policies that duplicate existing coverage, do not provide the coverage   
   promised, or are altogether bogus.†   
   † Harshbarger (1993) commented on this problem as having "all of the factors   
   which create an environment for fraud and exploitation.the need is great, the   
   cost is high, even legitimate policies are complex and confusing, and the   
   population is    
   vulnerable and living in fear of the day the bill comes due." [Abstract only]   
      
   Health remedies. The elderly often have health problems that require   
   treatment. Preying on this vulnerability, offenders market a number of   
   ineffective remedies, promising "miracle cures." Unfortunately, given this   
   false hope, many seniors delay needed    
   treatment, and their health deteriorates further.   
   Travel. Compared with younger adults, seniors often have more leisure time and   
   are attracted to low-cost travel packages. However, many of these packages   
   cost far more than market rates, provide substandard accommodations, or do not   
   provide the promised    
   services.   
   Confidence games. These frauds generally do not involve a product or service;   
   instead, they include a broad array of deceitful scenarios to get cash from   
   the elderly. The offender may pretend to be in a position of authority (e.g.,   
   a bank examiner), or    
   otherwise trustworthy, concocting a story to get the victim to hand over cash,   
   then disappearing. † For example, the perpetrators of "lottery scams" claim   
   to have won the lottery but to have no bank account in which to deposit the   
   winnings. The    
   offender promises the victim a premium in exchange for use of his or her   
   account. After the victim makes a "good faith" payment to the offender, the   
   victim never hears from the offender again.    
   † See Whitlock (1994) for detailed descriptions of numerous confidence games.   
      
   In addition to variations in the type of product or service offered, frauds   
   vary widely in the means used to commit them.   
      
   Telemarketing. Offenders call people at home, using high-pressure tactics to   
   solicit money for fraudulent investments, insurance policies, travel packages,   
   charities, and sweepstakes. Fraudulent telemarketing operations are designed   
   to limit the benefit    
   to the customer while maximizing the profit for the telemarketer and for the   
   highly efficient contact of a lot of potential customers. †   
   † See Schulte (1995) for detailed descriptions of a variety of telemarketing   
   scams.   
      
   Mail. Fraudulent prize and sweepstakes operations often mail materials to a   
   wide audience, relying on potential victims to "self-select" by returning a   
   postcard or calling to indicate their interest. The mailings often look   
   official, use extensive    
   personalization (e.g., repeating the recipient's name in the text), include   
   claims of authenticity, have contradictory content or "double-talk," and make   
   a seemingly low-key request for the recipient to submit a small fee. 2   
      
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