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Financial Elder abuse remains a growing problem in the United States. It can be a con artist, bogus charity, or dishonest contractor. Even family members or acquaintances can misuse older peoples' money. Bank employees are trained to notice red flags like unusual recent withdrawals or a new person accompanying older customers to the bank – behaviors that may identify whether or not a customer is vulnerable or currently a victim of financial abuse.

Don't Fall Victim to the Grandparent Scam

According to the Federal Trade Commission, between 2012 and 2014, consumers reported more than $42 million in losses from scams involving the impersonation of family members and friends. This scam, commonly known as the “grandparent scam,” is a form of financial abuse that deliberately targets older Americans. To commit this crime, fraudsters call claiming to be a family member in serious trouble and in need of money immediately. The scammer might say he’s stranded or has been mugged, and call in the middle of the night to add to the urgency and confusion. Once the money is wired, the victim later finds out that it wasn’t their grandchild they were helping, it was a criminal.

• Confirm the caller. Fraudsters are using social networking sites to gain personal information of friends and relatives to carry out their crimes. Verify the caller by calling them back on a known number or consult a trusted family member before acting on any request.

• Don’t be afraid to ask questions. Fraudsters want to execute their crimes quickly. The more questions you ask the more inclined they will be to ditch the scam if they suspect you’re on to them.

• Never give personal information to anyone over the phone, unless you initiated the call and the other party is trusted.

• Never rush into a financial decision and trust your instincts. Don’t be fooled—if something doesn’t feel right, it may not be right. Feel free to say no and get more information before you send money to someone.

5 Ways to Spot a Lottery Scam

According to the FBI, in 2014 consumers lost more than $8 million to solicitation scams. These scams, commonly referred to as “advance fee,” “lottery” or “sweepstake” scams, often begin with fraudsters telling the victim they’ve won a lottery or sweepstake raffle. The consumer is issued a check worth more than the amount owed and instructed to pay taxes and fees before receiving a lump sum payment. Unfortunately, the check-in addition to the raffle––is bogus.

1. Don’t be fooled by the appearance of the check. Scam artists are using sophisticated technology to create legitimate-looking counterfeit checks. Some are counterfeit money orders, some are phony cashier’s checks and others look like they are from legitimate business accounts. The company name may be real, but someone has forged the checks without their knowledge.

2. Never “pay to play.” There is no legitimate reason for someone who is giving you money to ask you to wire money back or send you more than the exact amount—that’s a red flag that it’s a scam. If a stranger wants to pay you for something, insist on a cashier’s check for the exact amount, preferably from a local bank or one with a local branch.

3. Verify the requestor before you wire or issue a check. It is important to know who you are sending money to before you send it. Just because someone contacted you doesn’t mean they are a trusted source.

4. Ensure a check has “cleared” to be most safe. Under federal law, banks must make deposited funds available quickly, but just because you can withdraw the money doesn’t mean the check is good, even if it’s a cashier’s check or money order. Be sure to ask if the check has cleared, not merely if the funds are available before you decide to spend the money.

5. Report any suspected fraud to your bank immediately. Bank staff are experts in spotting fraudulent checks. If you think someone is trying to pull a fake check scam, don’t deposit it— report it. Contact your local bank or the National Consumers League’s Fraud Center, fraud.org.

7 Tips to Help Older Adults Choose the Right Caregiver

According to the National Council on Aging, almost 90 percent of the financial abuse committed against older Americans are at the hands of someone they know and trust. Here are seven tips to help older Americans choose the right financial caregiver and prevent elder financial abuse:

1. Delegate someone you trust to make financial decisions. If you are unable to facilitate financial transactions, carefully choose a trustworthy person to act as your agent in all financial matters.

2. Know who is in your home. Conduct a thorough background check on all individuals you hire for personal care or home care services. Check references and credentials before you let them into your personal space.

3. Never sign something you don’t understand. Consult with a financial advisor or attorney before signing any document that appears suspicious or unclear.

4. Understand the terms of assigning a Power of Attorney. Granting someone POA gives them the authority to act and make decisions on your behalf, including managing and having access to your bank and other financial accounts. Make sure you fully understand the terms and conditions of consenting a legal agent before you do so.

5. Always trust your instincts. Exploiters and abusers are very skilled. They can be very charming and forceful in their efforts to exploit you. Don’t be fooled – if something doesn’t feel right, it may not be.

6. Safeguard your personal information. Shred old bills, junk mail, bank statements and other personal documents you no longer need. Leaving unwanted personal documents around the house could lead to the misuse of your information. If you come across keepsake documents opt to store them in a locked cabinet or safe deposit box at your nearest bank.

7. Keep personal items out of plain sight. Lock up checkbooks, credit cards and other monetary instruments to prevent unauthorized use.

14 Red Flags for Elder Financial Abuse

The key to spotting financial abuse is a change in a person’s established financial patterns. Watch out for these red flags:

1. Unusual activity in an older person’s bank accounts, including large, frequent or unexplained withdrawals

2. Changing from a basic account to one that offers more complicated services the customer does not fully understand or need

3. Withdrawals from bank accounts or transfers between accounts the customer cannot explain

4. A new “best friend” accompanying an older person to the bank

5. Sudden non-sufficient fund activity or unpaid bills

6. Closing CDs or accounts without regard to penalties

7. Uncharacteristic attempts to wire large sums of money

8. Suspicious signatures on checks, or outright forgery

9. Confusion, fear or lack of awareness on the part of an older customer

10. Checks written as “loans” or “gifts”

11. Bank statements that no longer go to the customer’s home

12. New powers of attorney the older person does not understand

13. A caretaker, relative or friend who suddenly begins conducting financial transactions on behalf of an older person without proper documentation

14. Altered wills and trusts

Fraud Against the Elderly: How You Can Spot and Prevent Financial Abuse

(FDIC Consumer Information)

Each year millions of senior citizens are victimized by financial fraud or theft of money, property or valuable personal information. Often, an adult child or other relative is responsible. Other situations may involve trusted individuals such as caregivers, legal guardians, investment advisors or new "friends." And because the types of abuse may differ widely, it's important to take a variety of precautions. Here are suggestions for protecting yourself and your loved ones:

Choose an advisor carefully. If you're considering hiring a new broker, attorney, accountant or another professional, even someone recommended by a friend or relative, it's best to independently look into that person's background and reputation before investing money or paying for services. For example, you can confirm that this person is properly registered or licensed and has a clean record with regulators and other consumers. When in doubt about how to research this information, ask your state Attorney General's office or local consumer protection agency for guidance.

Make sure you not only understand the role an advisor will be playing but trust that this individual will do what's best for you and your finances. Don't be afraid to ask questions or say no. After all, it's your money!

Be careful with powers of attorney. At some point, you may want to have a power of attorney, a legal document that authorizes another person to transact business on your behalf. While powers of attorney can be very helpful, be careful who you name as your representative. "Powers of attorney can be easily misused because they allow the appointed person to step into your shoes and do everything you can do, including taking money from your account and borrowing money in your name," warned Debi Hodes, an FDIC Consumer Affairs Specialist. "This is a matter to discuss with a lawyer who should prepare or review the document for you."

Protect your personal financial information. Never give out your bank account numbers, Social Security numbers, PINs (personal identification numbers), passwords or other sensitive information unless you initiate the contact. These requests may come from an unsolicited phone caller, letter writer, e-mailer or a person who shows up at your door. Be especially wary of someone who congratulates you about winning a (bogus) prize or lottery but first demands payment for taxes or other fees.

Also, keep your checkbook, account statements, and other sensitive information in a safe place. And shred paper documents containing sensitive information that is no longer needed.

Closely monitor your credit card and bank account activity. Review your account statements as soon as you receive them and look for unauthorized or suspicious transactions, which should be reported to your bank immediately.

Take your time when deciding on a major financial decision or investment. Make sure you understand the transaction and ask questions if you don't. If you need to, ask a lawyer or financial advisor to help you understand the documents and discuss what's best for you. "Walk away from anyone who says you must make a decision or otherwise do something right now," said Hodes.

Finally, here are additional tips:

  • Beware of callers asking for money or information. If you'd like to reduce the number of telemarketing calls you receive, consider signing up for the national Do Not Call Registry (call 1.888.382.1222 or visit www.donotcall.gov). If you are on this list, be suspicious of calls from any company or organization that you have reason to believe is not eligible to contact you under the registry's rules.
  • Don't comply with requests from strangers to deposit a check into your account (perhaps as part of an Internet sale) and wire some or all of it back. "If you send the money and the check is counterfeit, you may be held responsible by your financial institution for the losses," said Michael Benardo, Chief of the FDIC's Cyber-Fraud and Financial Crimes Section.
  • If you use social media, many security experts advise against posting the names of relatives and anyone's home address, full date of birth and daily activities because those can be valuable to a thief. "A scam on the rise involves con artists who look for personal information on the Internet that they can use to call or e-mail an elderly person and pretend to be a relative in distress — such as a grandchild being injured, in jail or lost in a foreign country — and needing money sent fast, without telling anyone else in the family," added Benardo. "They may also represent themselves as a lawyer or law enforcement agent needing money to help your relative."


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