Our country's aging population is increasingly being targeted by fraudsters. According to the Canadian Anti-Fraud Centre, Canadians between the ages of 60-69 are the most targeted by mass marketing frauds, while Canadians between the ages of 50-59 have reported the highest dollar losses. The topic of fraud and an individual's susceptibility to it can often be a sensitive topic to broach with your older relatives and friends, but a simple conversation could prevent them from being a target. As we continue our blog series in support of Fraud Prevention Month, below are a few tips and tools that may assist in starting the conversation.
Inform and educate before it is too late
Victims of fraud are often afraid to come forward, fearing social or familial backlash or embarrassment. I have seen cases where people have lost their homes, their retirement savings and all of their possessions before finally admitting to police, trusted advisors and family that they were victims of fraud. What makes the situation even trickier is that broaching the subject of becoming a victim of fraud can often be met with resistance, as people can be defensive regarding discussions that may imply a lack of knowledge or awareness. Finally, the perfect trifecta of difficulty is that a fraudster will, as part of their scheme, look to empower their victim while at the same time manipulating them.
The key to combatting all of the above is to have conversations early, frequently and without prejudice. When speaking about the potential for becoming a fraud victim some of the things to mention or reiterate are:
- Seniors are often targets of fraud;
- The types of frauds that are
typically associated or executed on seniors. The Canadian
Anti-Fraud Centre, as part of Fraud Prevention Month, has issued a
Financial Crime Trend Bulletin that identifies
four of the most common scams targeted toward seniors:
- Prize Scams
- Emergency Scams
- Romance Scams
- Service Scams
Stranger danger for adults
Like the concept of 'stranger danger' for children, a similar approach could be considered when discussing the potential for fraud with seniors. This phrase sums up the dangers of children interacting with adults they do not know and the same can be applied against potential fraudsters, but with a bit more explanation.
- Don't talk to strangers – a slight play on this is to consider whom you are speaking to. Did you contact them for information or have they contacted you? How did they come to get your information? Even if it is someone you know and trust, consult with someone else about the opportunity before making any payments or turning over any information.
- Create a code word and keep each other informed – One of the more prevalent scams currently trending is the emergency scam. The Canadian Anti-Fraud Centre describes this scheme as follows: "Scammers use social media, the internet and newspapers to target potential senior victims, a call is received claiming to be a family member or a close friend advising about an urgent situation that requires immediate funds, such as a family member was arrested or got into an accident while traveling abroad. Fees are required for hospital expenses, lawyer fees or bail. Usually the potential victim is instructed to send money via a money service business like Western Union or MoneyGram." This can be prevented by simply discussing your travel with any potential victims in your circle and let them know when you are away. Consider establishing a password or code word that when used in the event of a true problem, will signal to everyone that they should consider this a legitimate call for help.
- Don't accept gifts from strangers – This is especially important to remember, as one of the more common scams out there today is a prize scam where fraudsters will solicit seniors, advising them that they have won the lottery or sweepstakes. Prior to receiving any winnings, the victim must first pay an upfront fee, at which point the fraudster disappears and no winnings are ever received. Remember, if it sounds too good to be true, it probably is.
- If someone approaches you and you suspect it to be a fraud scam, report it – Plain and simple, report the attempt to the Canadian Anti-Fraud Centre.
Consider Using Power of Attorney
It is typically assumed that using a Power of Attorney is only considered when individuals are suffering decreased mental capacity, however, that doesn't necessarily need to be the case. Consider or suggest that a senior in your family assign Power of Attorney. The range of responsibilities that an individual assigned Power of Attorney can perform is limitless, provided these responsibilities are explicitly set out in an agreement. The individual assigned Power of Attorney can be relied upon to review significant investment opportunities or large dollar transactions that may prevent emotionally charged reactions or pressure tactics often applied by fraudsters. Furthermore, you can assign Power of Attorney to an individual that has significant financial wherewithal to further prevent the possibility that a transaction may occur without the proper due diligence having been applied.
Remember, the seniors in your life have done plenty to help protect you. Pay it forward – even if it's a sensitive subject – by making them aware of the risks they're exposed to and the measures they can take to safeguard their assets and well-being.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.