Americans over 60 are becoming more victims of fraud perpetrated online and over the phone at rates that add up to billions in losses annually, and federal investigators are warning that the scammers are becoming more sophisticated in the ploys they use to get their victims to hand over large sums of money.
A study by AARP found that an estimated $28.3 billion is lost annually to elder fraud scams. The report found that 72% - or more than $20 billion - is taken by people who are known to the victims, like family members, friends or advisers. The FBI is now calling on anyone who encounters suspicious activity online to disengage and report the conduct to law enforcement.
Rich Brune, a 75-year-old retiree living in Virginia, told CBS News that he fell for an online scam last year that cost him nearly $800,000. Sophisticated criminals posing as Microsoft employees contacted him online and told Brune his computer had been hacked, his financial accounts were compromised, and he needed to take immediate remedial action.
Over a five-month period, the Navy veteran said he was instructed to transfer much of his savings into a cryptocurrency account that the scammers told him was safe from the purported hackers. They then robbing him of his nest egg.
When his money vanished, the Internal Revenue Service informed him that he had approximately $200,000 in taxes owed because the money stolen from him had been withdrawn from his retirement accounts.
The federal tax code does not currently provide exemptions for individuals who have unwittingly withdrawn retirement funds as part of a scam, such as Brune.
Microsoft said the scammer who contacted Brune and pretended to be a Microsoftemployee is not associated with the company or its customer support team.
While troubling, Brune's investigation is not unique to investigators who work to both arrest elder fraud scammers and educate the public about the dangers online.
The false messages from these bad actors - pretending to work for tech companies and financial institutions alike - scare the victims into transferring their money into separate accounts for'safety' and then draining those accounts, according to a recent public safety announcement from the FBI. This often leaves the unsuspecting victims broke.
The criminal activities usually start in call centers in India and South Asia, the FBI said, necessitating collaboration with international law enforcement. In 2022, with the help of U.S. investigators, Indian officials carried out numerous raids on call centers and arrested individuals linked to elder fraud scams.
The scammers work first, to gain the trust of their victims, AARP director of fraud victim support Amy Nofzinger told CBS News, then go after personal information and money.
Nofzinger and AARP advisers tell seniors that calls or texts seeking Social Security and Medicare numbers are always a scam. Then stop, and contact someone you trust for help, she says.
Hundreds of volunteers work with elderly fraud victims at AARP, a non-profit organization.
In 2022, crime rates for older Americans and the elderly continue to rise, up 84% in 2021 to 2021, according to federal data. Investigators recommend people avoid unsolicited pop-ups and messages in texts and emails and decline to download unknown software or give others remote access to personal computers.
The FBI warns that the government will never ask an individual to transfer money to a government-run account or into a cryptocurrency exchange, and any request to do so may point to an attempt to scam.