We’ve all been potential scam victims. Your cell phone rings, and while you don’t recognize the number and it’s not one that you have stored in your contact list. It looks legitimate— or sort of legitimate, anyways. The area code is the same as yours, as is the prefix. It must be someone local, as scammers typically call from an unknown number that originated halfway across the nation or from a foreign country, right? Not always.
Commonly referred to as “the crimes of the 21st century,” financial scams were responsible for $5.8 billion stolen from consumers in 2021, which was an increase of 70% from 2020. And while that number may seem shocking, that figure doesn’t include losses from identity theft, which is one of the worst scams of all. According to the Federal Trade Commission, the most popular fraudulent schemes involve thieves pretending to be someone other than who they claim to be to steal money or obtain personal information to gain access to financial accounts. (1)
While no one is immune to being a potential victim of these crimes, scammers often target older people because of their probable “nest egg” retirement accounts. Additionally, this age group doesn’t typically monitor their credit rating as much as their younger counterparts and is more trusting. If they fall victim to a financial scam, they tend to keep it a secret so as not to look feeble or silly and risk looking like they cannot live on their own.
One of the top ways that Osiwala Financial Group fights back against these types of crimes is to spread awareness. Below are some popular scams occurring. We also discuss how to spot whether it’s an attempt to steal your money or information.
- Bogus Calls or Texts from the Internal Revenue Service (IRS). Some bogus IRS messages threaten that they will issue warrants for arrest or revoke your license if you do not return their calls. The IRS will not leave harassing pre-recorded messages on your phone demanding payment or personal information. Nor will the IRS attempt to reach you via social media or text. Any links sent through these platforms to pay a supposed debt or to claim a “stimulus payment” are fake and did not originate from the IRS. (2)
- Romance Scams. While this type of fraud certainly isn’t new, it remains popular because it works. No one wants to feel alone. And while dating sites or apps have certainly been a conduit for couples to find companionship, they’ve also opened the door for imposters to steal money from unsuspecting victims. After creating fake profiles, the scammer will work towards creating a false relationship and then ask for money to be sent “in the name of love.” (3)
- Medicare and Health Insurance Fraud. Every year from October 15th to December 7th, Medicare offers Open Enrollment. While this scam can happen year-round, open enrollment calls seem to increase during these few months. In this type of con, fake representatives of a supposed insurance company call to gain personal information to either file false claims to Medicare or to gain access to financial accounts. (4)
- Scams Surrounding Death. One of the most vulnerable times of someone’s life occurs immediately after the death of a loved one. Those days may be filled with emotions, including grief, loneliness, fear, and confusion. Thieves commonly research obituary notices and who the survivors are in order to take advantage of them. The scammer will then contact those claiming the deceased had debts with them and extort money to “pay off” the fake debts. (4)
- The Grandparent Scam. In these scams, the grandparent receives an urgent phone call or text claiming to be a grandchild who is in trouble or ill and needs money. Enough information is provided to make the plea believable, and money is sent where directed. How does the scammer get these intimate details about the grandchild? Their social media accounts. Kids nowadays post every move they make and provide all a scammer needs to make a heartfelt plea to a grandparent who would do anything to protect and help a grandchild. (5) With more than 70 million grandparents in the United States and 72% of them believing that being a grandparent is the single most important and satisfying thing in their life, it’s no surprise why this scheme is successful. (6)
What should you do if you or a loved one are victims of fraud ? All frauds should be reported to the Federal Trade Commission (FTC) at 877-382-4357 or by clicking HERE. You may consider notifying Michigan’s Attorney General as well.
As always, when it comes to financial issues, Osiwala Financial Group advisors are here to help you. That is why we always offer a 20-minute “Ask Anything” appointment. During these sessions, you can ask what’s on your mind. You can also contact us regarding retirement or financial issues, including fraud. These appointments are complimentary, and you are under no obligation to continue doing business with us. Click HERE to schedule your 20-minute “Ask Anything” appointment by phone, virtually, or in-office.