Because of their large accumulation of assets and diminished independence, aging retirees are prime candidates for scammers. That means aside from issues like longevity risk, healthcare costs, and financial abuse, advisors with a fiduciary duty should think about the different ways elderly clients can be targeted in financial fraud.
“There’s a reason that scam artists are the only criminals who are called artists,” Steven Weisman, a professor at Bentley University and owner of the website Scamicide, said in an interview with Barron’s.
According to Weisman, older adults can be particularly vulnerable to scams involving government-provided benefits, like public health plans and pensions; aside from the fact that older individuals rely on them so much, they can be difficult to understand, making victims afraid or embarrassed to ask questions during fraudulent phone calls.
For similar reasons, technology is another weak spot. Citing recent data from the Federal Trade Commission in the US, Barron’s said people aged 60 and over are five times more likely than younger ones to lose money on tech-support scams.
Many older adults also still have landline phones, and actually answer them. That gives another channel, aside from mobile phones, for fraudsters to make fake calls claiming to be from the CRA, a bank, or other large firm or agency. At that point, they can ask their victims to send money to a certain account or provide sensitive information such as their credit card number or social security number.
According to Weismann, people should never give out personal information in a phone call they did not initiate. If they think the call is legitimate, they should hang up and call back using a number they’re sure is legitimate. To minimize the risk, Canadians may consider adding their number to the National Do Not Call List to opt out of telemarketing calls, or use a robocall blocking app or service.
Since cellular phones also contain banking apps, payment information, and other personal details, they should be kept secure with a numeric or thumbprint password. Clients could also do the same for their mobile accounts to prevent SIM swapping, which is when impostors call a cell phone provider and request to switch a phone’s SIM card to a new device; after the switch is made, the impersonator could trick someone into divulging an access code needed for two-step authentication on financial accounts.
“Make sure you have a PIN on your wireless plan, and tell your mobile provider to not allow new SIM cards on your account unless you go into a store,” Weisman said.
He also advises people to follow other fraud protection practices:
- Keep security software updated
- Use unique and strong passwords
- Come up with creative security questions
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