A Field Guide to Preventing Elder Fraud

Consider Us Your Sensei for Fraud Protection

What's the Deal?

Financial fraud can devastate your clients and also damage your business as a financial professional. If your clients are older, their portfolios have less time to recover from losses. Being proactive rather than reacting to fraud after the fact can benefit your practice and show clients you’re looking out for them.

Help protect client relationships – and your business – by taking steps to help prevent it.

Why It Matters

Wealth and health are inextricably linked, so it’s no surprise that some victims have reported stress, anxiety, difficulty sleeping, and depression.

Help build trust with your clients and their families by sharing information about how they might help protect themselves from con artists and scams.

Help Clients Sift Facts from Phonies

Just as doctors may need to remind clients to stop self-diagnosing themselves on WebMd, financial professionals may need to help clients sift through the wave of financial information flung at them daily.

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Common Scams

Stranger Fraud

Fraud committed by those who have enough information to trick the victim into thinking they have a relationship. Examples include:

Email “phishing”

The internet is a popular tool for fraudsters. Phishing happens when a fraudster creates and sends an email that appears to be from a legit source or company that the victim does business with. The good news is, the email itself often offers clues that it is fake. Telltale signs include bad grammar or requests for sensitive information.

IRS impersonation

A fraudster may call claiming to be an IRS official, sometimes even giving a fake badge number. The con artist usually demands immediate payment, with threats of arrest, deportation, or other legal action for unpaid taxes or due to a mistake on a tax return.

Charitable donations

An example: A senior donates $10 to a new charity. No big deal, right? Well, it is when that person’s name appears on a “sucker list” of people known to always donate. In that scenario, the senior might receive multiple calls a day asking for money.


These usually involve an ad or salesman who persuades seniors to invest in an unusual asset, such as commemorative gold coins, a horse rescue farm, or even penny stocks.

Identity theft

More and more of us are becoming familiar with this one. A fraudster might apply for a credit card or other financial instrument in another person’s name, or a cybercriminal might steal and use someone else’s credit card or bank account number.

Home improvement

This typically involves a contractor who insists on being paid upfront for work he or she never intends to complete. In other variations, the contractor will overcharge the senior or charge multiple times for the same work.

Familiarity Fraud

Fraud perpetrated by someone the victim knows. Examples include:

Misappropriation of income

This usually involves people exploiting or exceeding the authority they’ve been given over someone’s finances. Think of someone who becomes a “representative payee” of Social Security benefits and then improperly accesses a senior’s Social Security income. Becoming a representative payee is similar to becoming an agent under a power of attorney.

Other examples could involve adding a name to a bank account under false pretenses, abusing power of attorney, or transferring a title to or re-encumbering real property.


A fraudster calls a widow to inform her that her deceased spouse owes thousands of dollars in unpaid debt. Financial ruin is threatened if she doesn’t pay quickly and a steeply discounted “settlement offer” is typically proposed.


The senior receives a call, ostensibly from a grandchild claiming to have been arrested while on vacation and needing money. The fraudster asks the senior not to tell Mom and Dad because they will get angry. These calls typically happen late at night when the senior is groggy and confused. This con has evolved to the point where scammers are following actual grandchildren on social media so they can give seniors correct names, making the con seem more believable.


This involves a younger man or woman who develops a close relationship with a senior—typically someone who is lonely or who has become isolated. The goal for these fraudsters is to be written into the will or receive gifts directly.

The True Link Report on Elder Financial Abuse 2015

How to Help Protect Your Most Vulnerable Clients

A terrifying scam gaining steam that involves preying on your clients’ emotions to cheat them out of thousands of dollars by using their family as the bait.

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Strategies to Help Prevent Fraud

Awareness may be the most effective tool against financial fraud. As a financial professional, be aware of signs that leave your clients vulnerable, like changes in financial judgment or a sudden interest in aggressive investment strategies and get-rich-quick schemes. Here are just a few strategies that could help prevent fraud:


What forms can elder financial fraud take?
  1. Financial exploitation. When businesses, individuals, or charities use pressure tactics or misleading language that cause seniors to make financial mistakes.
  1. Criminal fraud. When thieves steal someone’s identity or con seniors into sending money or sharing personal information.
  1. Caregiver abuse or “trust abuse.” When family, friends, or paid helpers take advantage of a trusting relationship to swindle money from a senior.
Who falls for fraud?

You might think women, older seniors, those living far away from relatives, or who have lost a partner are more vulnerable to fraud, but True Link found no evidence to support any of this. In fact, the report said widowed people experienced 8% less financial fraud than those who are married.

Fraud victims include those who are:

  • Financially sophisticated, perhaps due to overconfidence and being comfortable with moving large sums of money.
  • College educated.
  • Living in urban areas.
  • Extremely friendly, exposing them to more people in general – and more people who could exploit them.
What makes people fall for fraud?

None of us is immune to fraud. The perpetrators often prey on emotions. Seniors may be more vulnerable to fraud when experiencing:

  • Dependency on family or friends.
  • Recent hospitalization or surgery.
  • Recent loss of a spouse.
  • Recent move.
  • Recent retirement.

Support Materials

The following materials are available as additional resources

The Field Guide to Preventing Elder Fraud series also includes a presentation designed specifically to educate you. Contact your Transamerica wholesaler to schedule your client seminar today.

Client: Field Guide to Preventing Elder Financial Fraud
Financial Professional: Why Fraud Matters to You