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Be alert for financial schemes targeting seniors and vulnerable adults

Scams, fraud and financial abuse cost older Americans billions each year

You may feel that your money is safe and that you’d never fall victim to a financial scheme — and neither would your loved ones. However, there are bad actors in the world cooking up schemes to separate people from their money all the time — which is why it’s important to stay vigilant and be alert.

Older and vulnerable adults are the most frequent targets

While it’s possible for anyone to be caught unaware in a financial trap, older adults are criminals’ mostly likely targets — and they’re often successful. Statistics show that criminals often hit their mark: in fact, one in 10 Americans who are 65 and older and who live at home will experience financial abuse sometime in their lives.1

And people over the age of 60 who face functional, physical, or mental challenges when caring for themselves are also considered to be vulnerable to financial exploitation1 — which means their money, personal property or other assets are used illegally or improperly, or taken without their knowledge or consent.

And it’s not just older people. Fraudsters also frequently target people with diminished capacity — also known as vulnerable adults — people who are over the age of 18 who might have a developmental disability, live in a home or a facility, or receive in-home health or social services.

The risk can’t be ignored

Adults ages 70 to 79 are reported to be the age group hit the hardest. In second place are people ages 80 and older; 60- to 69-year-olds come in third place; and those in the 50- to 59-year-old group take fourth place.2

It’s no surprise that financial fraudsters would target older Americans who are retired (or nearing retirement) since they tend to have more wealth.

And the costs are high. Older Americans who are exploited by fraudsters experience an average loss of $34,000.3 A recent U.S. Senate committee report shows that older adults lose close to $3 billion each year to financial scams,4 while some analysts believe that number could be as high as $36.5 billion a year, because only a fraction of actual incidents are reported.3

Often not a random act

While you may be imagining the most common perpetrators are strangers and don’t know the victim, the perpetrator is often someone the victim knows well — and presumably trusts.

The National Center on Elder Abuse (NCEA) reports that just over half (51%) of reported perpetrators were strangers — while 34% were family, friends, and neighbors; 12% were businesses and 4% Medicare or Medicaid schemes.5

Common scams

There are a number of common scams frequently used to target older or vulnerable adults.

Making people feel uncomfortable is an art for con artists who like to instill fear in people (“If you don’t do X, then Y is going to happen”) or give the impression people might miss out on something (“If you don’t act now, you’ll regret it forever.”)

For example, the scarcity tactic is when someone says there’s a limited supply of something so you better buy that something now before they run out.6

Another gimmick is the social consensus tactic, which indicates that other savvy investors — perhaps in their own social circle — have invested their money and it’s totally paid off for them.6

Here are some of the other top scams that criminals tend to use.


Often robocalls use fake caller ID information so the potential victim believes the call is originating from their same area code or one nearby. These calls are intended to get the victim to divulge their personal info, buy a product and provide payment info over the phone, or to make payments for nonexistent debts or unpaid bills. Beware, too, of sweepstakes scams, computer tech support fraud schemes, and lawsuit or arrest threats.1

Impersonating the Internal Revenue Service (IRS)

Nobody wants to get a call from the IRS. However, it’s worse when it’s someone just pretending to be from the IRS. These con people have been known to tell victims they owe back taxes, and warn them if they don’t pay, they could experience foreclosure, arrest or deportation.1

Romance schemes

Online dating websites and apps aren’t just for the young — they also attract the young at heart, who are looking for love. In fact, according to a Pew Research Center report, 13 percent of U.S. adults over the age of 65 have used an online dating site or a mobile dating app.7

Unfortunately, these tools can serve as an easy inroad for dishonest people to get to people who’ve let their guard down and opened their heart.

Once a relationship is developed and trust is built between the two parties, the scammer will take advantage of the situation and ask for money they claim is for medical expenses, hotel costs, vet care for an ailing pet, visas for family members, and more.1

Grandparent scams

Grandchildren hold a special place in their grandparents’ hearts. So when they have a need, grandparents tend to respond — and scammers try to exploit this willingness to help.

Impostors might pretend to be the grandchild claiming to be in need of money for an emergency like a medical emergency, accident, arrest or being stranded in a foreign country. Sometimes they turn over the phone to another scammer, posing as an authority figure like a doctor or police officer, to add to the story.

In all of these cases, the scammer asks for money immediately and to not tell their parents, purportedly to avoid punishment or disappointment (but in reality, to avoid detection).

Recognize the warning signs

Thankfully, there are red flags that may appear when someone is experiencing financial exploitation or diminished capacity. 

If you care for an older parent or family member, here are some warning signs from the Women’s Institute for a Secure Retirement and the National Council on Aging that could indicate they are being taken advantage of or exploited:

  • You notice significant changes to their spending habits or financial situation, like large payments or frequent small withdrawals
  • They seem confused, nervous or preoccupied
  • They get defensive or avoid talking about financial matters
  • They develop friendships with much younger people
  • A caregiver or another family member won't let you talk to them directly, or becomes very interested in the older person's finances
  • Regular bills — like mortgage or rent, utilities or medical bills — are going unpaid when there should be enough money to cover them8, 9

Don’t wait to take action

Now you know what warning signs to look for — but before it gets to that stage, try to become familiar with your loved ones’ finances. 

For example, what are their bills each month? Also, have a conversation about some things they should do or not do to mitigate their risk of being a victim of financial fraud.

Let them know these are precautions that you’re taking too. And ask them if they’d like to have a trusted contact person to have as a backup on their financial accounts in case there are any red flags in the future.

Fraud isn’t fair. And it seems especially unfair when it impacts vulnerable adults. However, the steps you take now can fortify your defenses and make you less susceptible to a financial attack.

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1. Fitzgerald, Maggie. Scams cheat older Americans out of almost $3 billion a year. Here’s what to watch for.” Published February 13, 2019.

2. Skiba, Katherine. “Older Americans hit hard by financial fraud.” AARP. February 28, 2019.

3. Arends, Brett. Scams are taking a heavy emotional toll on senior citizens.” Marketwatch. Published March 5, 2020.

4. United States Senate Special Committee on Aging. Fighting fraud: Senate Aging Committee identifies top 10 scams targeting our nation’s seniors” (Fraud Book 2020). Published January 31, 2020.

5. National Center on Elder Abuse. Statistics and data. U.S. Department of Health and Human Services. Accessed January 26, 2021.

6. FINRA. Avoid fraud. Accessed January 28, 2021.

7. Vogels, Emily A. 10 facts about Americans and online dating.” Pew Research Center. Published February 6, 2020.

8. The Women’s Institute for a Secure Retirement. "A checklist to help you protect those you care about from elder financial abuse." Published November 17, 2019.

9. National Council on Aging. "8 tips for how seniors can protect themselves from money scams." Accessed February 5, 2021.

DOFU 2-2021