Protect Yourself from Common Scams Targeting Seniors
There are dozens of ways criminals scam seniors out of their hard-earned money or entitlements. This guide will list and explain some of the most common scams. Preparation and awareness will help you spot criminals and avoid victimization.
Phony Professionals and other imposters can look, talk and walk like the real thing. Scammers often impersonate building contractors and financial advisors. Victims can be targeted at random and by referral. Some criminals move from door-to-door until someone takes the bait. Others pass victims’ names to other criminals.
Home Improvement Scams
“Professionals” may offer free inspection of your home, or claim to have noticed a problem from the outside. Be on the lookout if the contractor:
- Tries to draw you outside. An accomplice may enter and steal valuables.
- Insists there is a serious issue that needs immediate attention, and offers his services.
To avoid a possible home improvement scam, remember to:
- Always get a second opinion and at least three specific estimates. The problem could be minor, or there might not be a problem at all.
- Shop around for a good contractor and always ask for a contractor’s Maryland Home Improvement Commission License. Call the commission at 410.230.6309 for verification and ask if the contractor has a complaint history.
- Demand a detailed contract in writing. The Attorney General’s Office suggests including the contractor’s license number, a description of the work to be done, a timetable, payment schedule, names of subcontractors, warranty agreements, financing arrangements, materials needed and labor cost.
- Don’t pay in advance, with a lump sum, or with cash.
For more information on home improvement scams, see The Maryland Consumer Rights Coalition’s Home Improvement Guide on their website, www.marylandconsumers.org.
Fraudulent financial advisors can be strangers or people you already know or do business with. Whether you know them or not, they will appeal to your fears and desires to persuade you. Be on the lookout if the adviser:
- Offers a free lunch seminar. High-pressure tactics are often used to persuade attendees.
- Appeals to your affiliation with, or commitment to a membership organization, religious or ethnic group.
- Refuses to give you literature on the investment or company.
- Dodges questions about specifics or says, “Leave everything to me” or, “You wouldn’t understand.”
- Gives you unsolicited financial advice, especially if they expect something in return.
- Promises high returns, like 25%, 50%, or even 500%.
- Presses you to make an immediate decision or provides a “This time only” deal.
The following are some of the most popular investment scams “professionals” use.
Ponzi or pyramid schemes: Criminals recruit an original group of investors, and then pay them off with new capital gained from more investors. These ventures aren’t sustainable and eventually collapse.
Promissory notes: A company may use this to raise money. In exchange for an investor’s loan, the company promises a fixed return. These can be legitimate, but broadly marketed investments usually aren’t.
Reverse Mortgages: Reverse mortgages aren’t appropriate for everyone, and unscrupulous brokers may make misleading claims for commission. Brokers use high-pressure tactics, “free money” claims and misrepresentation of risk. Fees, risks and conditions always accompany loans. Visit www.ncoa.org for detailed information and always ask to see a detailed contract before signing.
To avoid a possible investment scam, remember to:
- Read up on the investment and research similar offers. You may find a better deal.
- Avoid pouncing on an offer after financial or emotional loss. Scammers try to appeal to vulnerability.
- Don’t be afraid to complain or say no when you don’t understand something or need more time to decide.
- Research your broker or adviser and the securities they’re selling. You can contact the Attorney General’s Securities Division at 410.576.6360 or the Financial Industry Regulatory Authority at 1.800.289.9999.
- Insist on regular reports and keep thorough records of all contact with an adviser, including conversations.
Medical Sales Scams
This type of scam can happen online and in person. Criminals can coerce victims into purchasing medical equipment or medication that is never delivered, or worse, faulty and dangerous. Unnecessary medical equipment and hearing aids sales, miracle cures and counterfeit prescription drug scams are frequently targeted at older adults.
Medical equipment and hearing aids sales
Fraudulent medical equipment and hearing aids companies can appear legitimate with a website and seemingly honest and knowledgeable representatives. Even if a company seems genuine, it is important to speak with a health professional you trust, not a salesperson, before purchasing anything. Criminals may try to convince you that you need an unnecessary product, or that Medicare will cover the expense. Be on the lookout if:
- The equipment is marketed as “breakthrough” technology.
- A company markets itself as a Medicare representative. Medicare does not supply or recommend equipment.
- The salesperson lingers in your home or at your door.
- The salesperson prevents you from asking others for advice.
- The salesperson installs equipment that is difficult to move.
To avoid a possible medical equipment scam, remember to:
- Have a hearing exam performed by a licensed physician. Equipment may be unnecessary.
- Get a hearing aids sales referral from your doctor, family or friends.
- Call the Board of Audiologists, Hearing Aid Dispensers, and Speech-Language Pathologists to verify the seller at 410.764.4725. You can check a company’s reputation through your healthcare specialist.
- Know the cancellation and refund policy. Hearing aid purchases can be cancelled for any reason within 30 days, under Maryland law.
- Pay with check and pay a small deposit, if possible. Get a receipt.
Counterfeit Prescription Drugs, Fraudulent Miracle Cures and Anti-Aging Products
Pharmaceutical scams frequently occur over the Internet, where distributor authenticity is harder to track. Phony medications may actually be placebos or unsafe substances. Even homeopathic remedies using natural sources or herbs may not be safe. Be on the lookout if there are promotions or “deals” surrounding the drug.
To avoid counterfeit prescriptions, remember to:
- Only purchase from sites that require prescriptions.
- Be sure the online pharmacy is licensed. For pharmacy verification, visit Maryland’s Board of Pharmacy website for more information.
- Do not purchase products from a site that cannot verify it has a U.S. location.
Be on the lookout if the company:
- Claims the product is a “scientific breakthrough” or can cure a range of ailments that don’t seem to be related.
- Claims the formula has no apparent side effects.
- Claims the government or medical field has plans to hide or destroy the product.
To avoid fraudulent miracle cures and anti-aging products, remember to:
- Contact the Better Business Bureau to see if there are any complaints about the product.
- Consult your doctor before trying a new medication or product.
Charity Scams are often targeted at older adults because of their giving and trusting culture. Criminals call victims claiming they represent a charity, often an organization benefitting disaster relief victims. Be on the lookout if:
- The organization has a name and logo similar to that of a well-known charity.
- The caller refuses to send written literature about the charity or cause.
- The caller offers to send a courier to pick up your payment.
- You receive an invoice for a donation or pledge you never made.
To avoid a possible charity scam, remember to:
- Find out if the charity is registered in Maryland. Call the Maryland Secretary of State’s Office at 800.825.4510.
- Never give money or credit card information over the phone.
- Demand an invoice for your pledge.
Funeral and Cemetary Scams
These are commonly targeted at victims who are at their most vulnerable. Con artists may approach family and close friends at funerals and claim the deceased had an outstanding debt. Funeral homes may also take advantage of a family’s unfamiliarity with funeral costs. To avoid a possible funeral scam, remember:
- Include specific services and costs when drawing up a pre-need funeral and burial contract. Review it with a lawyer or knowledgeable friend or family member.
- Obtain a copy of the signed contract and familiarize family or friends with the arrangements. For more information about pre-need contracts, you can contact the Maryland Office of Cemetery Oversight at 410.230.6229 and the Maryland State Board of Morticians at 410.764.4792.
- Widows are not responsible for contracts signed before marriage. Also, widows aren’t responsible for contracts with only the deceased’s name, unless they have agreed to financial liability.
Free Trip Offers, Sweepstakes Scams, and Lotteries
While some of these opportunities can be legitimate, but many require an “investment” for a lousy prize. Remember, you don’t have to pay or provide personal information to claim a real prize or winnings. If the offer requires a social security number or bank account number, it’s a scam.
Free trip offers A free trip is often just a bait to lure consumers to buy something, often a timeshare or travel club membership. Some companies deliver what they promise, others sugarcoat the truth or hide fees and taxes. Be on the lookout if:
- You receive a postcard that must be kept for free or reduced travel costs.
- You receive a postcard or letter saying you won a vacation. This is often a gimmick used to lure people to an office where salespeople use high-pressure tactics.
- You are forced to sit through a presentation before you can claim your prize.
- You are required to give your credit card number to reserve a spot.
To avoid free trip scams, remember to:
- Only attend a sales presentation if you are interested in what the company is selling.
- Review contracts and take time before making a decision.
Sweepstakes Scams and Lotteries
Similar to free trip offers, sweepstakes scams require the victim to pay a fee or make a purchase to claim their “prize.” As victims await the arrival of their winnings, criminals disappear with “fees” and “taxes” paid upfront. Be on the lookout if:
- You receive a call saying you won a sweepstakes or lottery you didn’t enter.
- The sweepstakes or lottery is based in a foreign country.
- You are asked to make a purchase, or pay fees and taxes to claim a prize. Law permits sweepstake contestants to enter drawings without purchase. Law also requires winners pay taxes to the IRS, not promoters.
- The organization requires money sent by courier, overnight delivery or immediate wiring through Western Union.
The Grandparents Scam
Unfortunately, scammers who target grandparents are growing in popularity. Criminals, pretending to be grandchildren in financial trouble, call victims to extort money. In one scheme, a scammer pretends to be a victim’s grandchild, mentioning a specific name. In other cases, the caller pretends to be upset and waits until the victim guesses which grandchild is on the other end. Now the scammer is “in” and will ask the victim for monetary help. Be on the lookout if:
- The caller does not specify who they are.
- The caller claims they are in financial trouble, but asks you not to tell their parents.
- The caller asks for money to be sent through Western Union or MoneyGram.
To avoid a possible scam, hang up the phone and call the grandchild back using a known phone number.