Scams: What Seniors Should Beware Of

By: Jody Smith

An article on Accountingdegree.com has issued some cautionary information to seniors to help them better protect themselves from fraud. The imagination and creativity of the con artist seems to know no bounds, and when one old trick has become obvious and obsolete, they've already moved on to a new one.

Here are some scams to keep an eye open for.

Low-risk, high-return investment offers are actually higher risk and lower return than the con artist wants you to see. To protect yourself from being taken in, be sure to look into the alleged opportunity and learn more about it. Ask for professional advice -- from someone else, unconnected to the financial offer on the table. Don't make quick decisions.

Charitable gift annuities that are legitimate are great. Charitable gift annuities that are phony are obviously something to avoid. How to tell the difference between the two? Always do your research first. Make sure there is indeed such a charity, and that it is something you want to support. If you decide to go ahead, do so through a professional financial advisor you know you can trust.

Watch out for high-return CDs (certificates of deposit) that promise more than they really deliver, sold for less of a cost than they really exact. Another way of putting this is to say that the con artists peddling fraudulent high-return CDs will take your money but they won't invest it and you will be out the money. Once again, do your research, and find out whether these people are who they say they are.

An article on Nolo.com reported that the form of elder abuse that is ahead of the pack is financial fraud. It went on to say that Consumers Digest indicated there are 5 million cases or more annually in the United States. Yet only 1 in every 25 cases is believed to be reported to law enforcement or to the government each year due to embarrassment or confusion on the part of the senior involved.

Telemarketing and mail fraud combined are thought to rake in about $40 billion per year affecting one in six Americans, according to the U.S. Department of Justice. The AARP said that of these telemarketing and mail fraud cases, approximately 80 percent are 50 years of age or more.

Phony winnings are time-honored and popular scams. A senior may be told that they've won something and all they have to do is send money to cover fees and taxes, or to cover charges at customs, before they get their prize. This may seem to be a transparent scam, but not everyone has been seeing it that way unfortunately. The U.S. Attorney General said that over a billion dollars a year is stolen this way every year.

Jody Smith is a freelance writer for EmpowHER.com.

Sources:

10 Scary Financial Scams That Target the Elderly

http://www.accountingdegree.com/blog/2011/10-scary-financial-scams-that-target-the-elderly

Elder Abuse: Financial Scams Against Seniors

http://www.nolo.com/legal-encyclopedia/elder-abuse-financial-scams-against-29822.html

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