Variety of scams targeting seniors on the increase

Posted Friday, March 28, 2008

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Pittsboro, NC - State and federal agencies have reported a variety of new fraud schemes across the state and nation aimed at getting money from seniors and other vulnerable citizens, said Angel Dennison, director of the Chatham County Council on Aging. At least one of these has showed up in Chatham County.

“We have never received so many reports from various investigation agencies within such a short timeframe, so it is clear that the declining economy is leading to more schemes to take advantage of vulnerable groups,” Dennison said.

“We advise all citizens, not just seniors, to be on the alert for any scams similar to the ones reported. If something sounds questionable or too good to be true, it is best to stay far away from it.”

Dennison said that anyone who receives contacts like the ones described below should report them to the Attorney General’s Office at 1-877-5-NO-SCAM. “Seniors also can contact our office at 919-542-4512. We would like to know that such activities are in the area and can put the person in touch with the appropriate investigating agency.”

Scams that have been reported in the past few weeks include:

Free Lunch Seminars: The Securities Division of the NC Department of the Secretary of State warns seniors about several unethical companies hosting “free lunch seminars” related to retirement investments.

“We have seen these free lunch investment seminars offered in our county, so we know that our seniors are being targeted,” Dennison said.

The lunch seminars usually involve sales pitches promising annual investment returns of 10% or more. Some claim that “you can retire early” with these investment payoffs.

The Securities Division advises seniors to be wary of any “free lunch” seminars, especially those involving promises of high interest rates and annuity investments. Many promoted annuities have high penalties for early withdrawal of funds and also pay large bonuses in the first year only.

For more information, click here.

Phone Number Changes: The NC Senior Consumer Fraud Task Force has identified at least two incidents where overseas con artists have isolated older victims by switching their phone numbers to unlisted numbers. The scammer will make sure that they are the only one that knows the new number.

The purpose is to isolate the person from family members, friends and others using various psychological strategies. They may warn victims to keep information about transactions a secret and to prevent others from meddling in their personal and financial affairs.

The initial contact usually has been stated as giving the senior citizen a chance to win an overseas sweepstakes contest offering large prizes. In the process, the scammer requests social security numbers and other confidential information needed to register the senior for the phony sweepstakes.

The scammer initially uses this information to make the unlisted phone number switch, but this is followed by various efforts to obtain money for the “sweepstakes.”

Family members and friends should be on the alert for any senior whose phone number is unexpectedly changed to an unlisted number and to immediately visit the person to make sure that they authorized this change.

Identify Theft by Phone: Attorney General Roy Cooper reports that they regularly receiving reports of scammers using automated phone calls (robo calls) to promise credit cards with lower interest rates and other benefits. In the process, they are stealing identities and getting access to existing credit card numbers and bank accounts.

The pre-recorded telemarketing calls will usually announce that they are calling the person about “account services”, “customer services,” “card services” or similar types of activities.

Cooper advises people not to provide any personal information, such as social security numbers or bank account information, to phone contacts that you do not know personally, especially automated calling services.

Advance Loan Fee Emails: The Federal Deposit Insurance Corporation (FDIC) has reported increases in email contacts that claim to be sent by federally-insured financial institutions. The emails advertise such services as low-interest mortgage refinancing, debt consolidation and elimination, small business loans, and special loan programs for veterans and minorities.

The scams usually target those needing fast, easy loans. They make false promises for guaranteed loans in return for fees paid upfront by the loan applicant. Some scam artists may even design websites and online loan applications that look legitimate, sometimes using stolen logos from well-known companies.

The warning signs include: guarantees of loan approval; required payment of upfront loan fees; and overseas contact information. The FDIC advises not responding to email offers dealing with financial services, especially fast, easy loans.