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The number of older Americans who report losing more than $100,000 to fraud in a given year has more than tripled since 2020, according to the Federal Trade Commission, a trend that experts say represents a grave and growing threat to older adults’ financial security.
In 2023, about 4,600 adults age 60 and older reported being defrauded of a six-figure sum, according to a report the FTC issued in October. That’s up from about 1,300 in 2020.
Such thefts can be especially devastating to older adults, who have less opportunity to earn back what they’ve lost, greatly impacting their quality of life in old age, experts said.
“It’s life altering,” said John Breyault, vice president of public policy, telecommunications and fraud at the National Consumers League, a consumer advocacy group.
Aside from the financial blow, victims also bear the emotional “trauma of knowing they have to live rest of their life in poverty,” Breyault said.
Common scams targeting older Americans
Consumers overall lost $10 billion to scams in 2023, a record high, according to the FTC.
The figure is also $1 billion more than the fraud loss reported in 2022, despite the number of fraud reports being roughly the same, at about 2.6 million, the FTC said.
“Scammers are really getting more sophisticated, better at what they do and the technology they’re using seems to allow them to target victims with ever more precision,” Breyault said.
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Adults age 60 and older reported losing more than $1.9 billion to fraud last year, up from $1.6 billion in 2022, the FTC said.
The true scope of losses by older adults was likely significantly higher — around $62 billion in 2023 — after accounting for underreporting, the FTC said. Many Americans may not report these crimes to the police or other sources partly due to embarrassment about having been duped or because they assumed nothing could be done, according to a 2023 Gallup News poll.
Older adults were 60% more likely than younger ones to report losses exceeding $100,000 last year, according to the FTC. Criminals commonly stole such vast sums from older adults via romance scams, investment frauds and imposter scams, the FTC said.
Imposter scams often involved fraudsters impersonating friends and family or agents from technology firms like Microsoft, sweepstakes and lottery companies like Publishers Clearing House, institutions like banks and government agencies like the Social Security Administration, the FTC said.
The Federal Bureau of Investigation has also detailed a stark increase in internet crime defrauding older Americans in recent years. The average victim in that age group lost more than $34,000 in 2023, the FBI reported.
Investment scams, especially those involving fake cryptocurrency investment opportunities, accounted for the largest reported losses among all older adults in 2023: $538 million, up 34% from 2022, the FTC said.
3 common red flags of a scam
“We’d all like to believe we could spot an online scam a mile away,” the National Council of Aging wrote this year. “But the truth is that con artists and cybercriminals are getting craftier and more sophisticated by the day.”
That said, would-be victims can protect themselves by recognizing three common tactics used by scammers, Breyault said:
1. Sense of urgency
Criminals often try to create a “heightened state of emotional urgency,” Breyault said.
This psychological tactic pushes victims to act impulsively, rushing them into making decisions or providing sensitive information without thinking, according to NCOA.
“Fraudsters may say an offer is good for a limited time only, a product is about to run out, or that you must make a payment immediately to prevent negative consequences,” NCOA said.
2. Social isolation
Scammers try to prevent consumers from talking to a third party. For example, they might say, “Don’t tell anyone about this. Don’t go to the cops. This is an investment no one knows about so don’t tell anyone about this. It’s our little secret,” Breyault said.
“If you’re unsure about the person you’re talking to or what you’re being told, ask a friend or family member for advice before taking any further steps,” NCOA said. “Sending a quick screenshot of a text, or simply walking through the scenario with someone you trust, can often help you see things more clearly.”
3. Unusual ways to pay
Criminals often ask victims to make a payment by buying gift cards, sending a wire transfer, going to a bitcoin ATM, or sending money through a peer-to-peer transaction on a platform like Zelle or Venmo, for example, Breyault said.
Consumers generally don’t have recourse to be refunded money in such circumstances, he said.
While there are “legitimate” uses for such payment methods, they often appear “unusual” in the context of a fraud: For example, why would a loved one who claims to need cash ask you to send money via a bitcoin ATM? Breyault said.
“When you do buy products online, make sure you only use a payment option that offers reimbursement for authorized payments (such as most major credit cards),” NCOA wrote. “Using a form of direct payment, such as a payment app, is essentially the same as sending cash. You may not be able to receive a refund.”