Running head: FRAUDULENT BEHAVIOR 1

Fraudulent Behavior: Ways in which Scammers Financially Exploit the Elderly

Verona L. Miller

Legal Studies Academy

First Colonial High School

FRAUDULENT BEHAVIOR 2

Abstract

This paper examines the growing problem of elder fraud and how it impacts the American senior

population. The author starts off by examining the different types of financial scams most

commonly used against the elder population. The author also discusses the implications of

COVID-19 on the issue and how it has escalated the problem. The author also includes what

steps an elder should take after discovering they have been scammed as well as the relevant laws

that will be used against the scammer when they are caught. To end the paper, the author writes

about what makes seniors a target for fraud and the precautions they can take to lower their risk

of being financially exploited.

Keywords:​ Elder Fraud, scams, COVID-19

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Fraudulent Behavior: Ways in which Scammers Financially Exploit the Elderly

“We are changing the world with technology” - Bill Gates. However, that does not mean

technology is always changing the world for the better. The advancement of technology allows

people to better connect with others from a greater distance: friends, family, and criminals. The

group most targeted by fraudsters’ growing arsenal are the elders in the nation, costing senior

citizens in America upwards of $3 billion each year (Federal Bureau of Investigation, n.d.). The

prevalence of this issue only increases due to it being what is called a low-risk crime, as

criminals have a low probability of being caught or punished from committing the crime. Many

elder fraud cases tend to go unreported, and even when they are, it is a hard crime to prosecute

after the fact (National Council on Aging, n.d.). These cases are becoming more expensive over

time as the money lost by those 50 and up in the first three months of 2019 nearly increased by

60 million in the same months in 2020 (Payne, 2020). Elder fraud deteriorates the financial

stability of its targets when scammers use a variety of methods in order to steal from the elderly

population.

Types of Elder Fraud

Fraudsters use several types of scams ​to​ ​try​ ​and​ ​steal​ ​from​ ​the​ ​elderly.​ The details and

extent of the scam are then determined by the fraudster as they take advantage of any situation in

order to increase their payoff. This concept has been seen increasingly this past year as they alter

a couple of common scams in order to prey on people’s fears during the pandemic.

Basic Scams

​The​ ​first​ ​type​ ​of​ ​scam​ fraudsters ​use​ ​tries​ ​to​ ​get​ ​elders​ ​to​ ​buy​ ​a​ ​fake​ ​service​ ​or​ ​good​s

​from​ ​them.​ ​They​ entice their victims to buy what they are selling both by contacting them
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directly via calls and emails, and indirectly through TV and radio ads.​ ​The​ ​most​ ​common​ ​types​

​of​ ​products​ fraudsters ​use​ ​are​ ​fake​ ​prescription​ ​drugs,​ ​fraudulent​ ​anti-aging​ ​items,​ ​and​ ​fabricated​

​investments (National Council on Aging, n.d.).​ ​Scammers​ ​will​ ​also​ ​advertise​ ​different​ ​services​

​that​ ​elders​ ​can​ ​purchase​ in order to steal more from them.​ ​One type are ​telemarketing​ ​schemes​

​that​ ​take​ ​advantage​ ​of​ ​the​ ​fact​ ​that​ ​older​ ​people​ ​are​ ​more​ ​likely​ ​to​ ​shop​ ​over​ ​the​ ​phone, allowing​

​fraudsters​ ​to​ ​get​ ​their​ ​money​ ​without​ ​having​ ​to​ ​deliver​ ​any​ ​items​ ​to​ ​the​ ​elder’s​ ​house (National

Council on Aging, n.d.).​ ​Another type of ​scam is when fraudsters ​that​ ​take​ ​advantage​ ​of​ ​an​

​elder’s​ ​lack​ ​of​ ​knowledge​ ​on​ ​a​ ​subject​ ​to​ ​inform​ ​them​ ​they​ ​have​ ​a​ ​problem​ ​that​ ​does​ ​not​ ​actually​

​exist.​ ​The​ fraudster ​then​ ​offers​ ​to​ ​fix​ ​that​ ​made-up​ ​problem​ ​or​ ​offer​ ​their​ ​services​ ​to​ ​help​ ​them​

​find​ ​and​ ​hire​ ​someone​ ​to​ ​fix​ ​the​ ​problem.​ ​An​ ​example​ ​of​ ​this​ ​type​ ​of​ ​scam​ ​was conducted from

the years 2014 to 2017 by a businessman in Virginia Beach named Gregory​ ​J.​ ​Ziglar​. He told

homeowners concocted problems with their house before asking them for money in exchange for

his services of securing a government loan for them. ​He​ ​then​ ​asked​ ​them​ ​for​ ​money​ ​in​ ​order​ ​to​

​help​ ​them​ ​get​ ​loans​ ​from​ ​the​ ​government​ ​in​ ​order​ ​to​ ​take​ ​care​ ​of​ ​the​ ​repairs, leaving his victims

with a huge amount of debt with little or no improvements on their dwelling (WTKR, 2020).

Another​ ​type​ ​of​ ​scam​ ​fraudsters​ use ​has​ ​them​ ​pretending​ ​to​ ​be​ ​someone​ ​else​ ​in​ ​order​ ​to​

​get​ ​money​ ​or​ ​information​ ​out​ ​of​ ​their​ ​targets (National Council on Aging, n.d.).​ ​In​ ​order​ ​to​ ​get​

​information​ ​from​ ​the​ ​elder,​ ​fraudsters​ ​will​ ​commonly​ ​pretend​ ​to​ ​be​ ​a​ ​Medicare​ ​representative​

​that​ ​needs​ ​their​ ​personal​ ​information​ ​for​ ​their​ ​account.​ ​They​ ​will​ ​also​ ​send​ ​out​ ​emails​ ​pretending​

​to​ ​be​ ​some​ ​type​ ​of​ ​government​ ​agency​ ​that​ ​needs​ ​their​ ​information.​ ​For​ ​example,​ ​they​ ​might​

​pretend​ ​to​ ​be​ ​the​ ​IRS​ ​asking​ ​about​ ​a​ ​tax​ ​refund​ ​in​ ​the​ ​email​ ​they​ ​sent​ ​out.​ ​Some​ ​scammers​ ​will​

​also​ ​take​ ​advantage​ ​of​ ​an​ ​elder’s​ ​love​ ​for​ ​their​ ​family​ ​by​ ​calling​ ​them​ ​and​ ​pretending​ ​to​ ​be​ ​their​
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​grandchild.​ ​They​ ​then​ ​ask​ ​the​ ​elder​ ​if​ ​they​ ​could​ ​give​ ​them​ ​some​ ​money.​ ​Then,​ ​in​ ​order​ ​to​ ​cover​

​their​ ​tracks,​ ​the​ ​scammer​ ​will​ ​beg​ ​their​ ​grandparent​ ​to​ ​not​ ​tell​ ​their​ ​parents​ ​about​ ​the​ request.​

​This​ ​scam​ ​is​ ​especially​ ​appealing​ ​to​ ​frauseters,​ ​even​ ​with​ ​the​ ​low​ ​cash​ ​reward,​ ​since​ ​it​ ​requires​

​little​ ​research​ ​and​ ​work​ ​on​ ​their​ ​part.​ ​However,​ ​the​ ​most​ ​prevalent​ ​reported​ ​cases​ ​of​ ​fraud​ ​that​

​elders​ ​fall​ ​victim​ ​to​ ​are​ ​done​ ​by​ ​a​ ​member​ ​of​ ​their​ ​own​ ​family (National Council on Aging, n.d.).​

​An example of this happening is the case ​U.S. v. Williamson​, where Elizabeth Williamson stole

upwards of $96,000 from her in-laws while she was their primary caregiver from 2015 to 2017.

She did this by stealing their checkbooks and then forging their signatures, redirecting their mail

so it goes to her house instead of theirs, and using their financial accounts when shopping (U.S.

Department of Justice, 2019). No​ ​matter​ ​the​ ​scam,​ ​each​ ​of​ ​these​ ​leave​ ​the​ ​elder​ ​targeted​ ​in​ ​a​

​vulnerable​ ​position​ ​financially​ ​with​ ​few​ ​ways​ ​of​ ​recourse​ ​afterward.​ ​

COVID-19 Influence

The article “Criminals Work from Home during Pandemics Too: a Public Health

Approach to Respond to Fraud and Crimes against those 50 and above” by Brian Payne (2020)

focuses on the several ways COVID-19 has affected elder fraud cases. In order to show this

effect, Payne uses data collected by the Federal Trade Commission that show the number of

cases and how much money was lost for each age group within the first three months of the year.

Using the data, Payne illustrates how those fifty and older are overrepresented in the number of

cases they have in comparison to how much they make up the population. He also uses the data

to demonstrate how the amount of money lost by the elderly in 2020 increased significantly in

comparison to their 2019 amount, while also pointing out that the increase for them between the

two years was greater than the increase in loss of money suffered from the younger age groups.
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The reason for this increase is because fraudsters were taking advantage of people’s fear of the

virus, even before quarantine officially started in mid-March (Payne, 2020). Scammers started

implementing phishing schemes that claimed to be supplying them with measures that would

protect them from the virus in late January, especially after the World Health Organization

declared coronavirus “a global emergency” (Payne pg. 4, 2020). The main types of COVID-19

frauds that targeted the elderly this year were “grandparent scams, medical fraud, social security

administration frauds, and personal care fraud” (Payne pg. 4, 2020). In grandparent scams,

scammers pretend to be someone calling on behalf of their child or grandchild who need

immediate funds because of a COVID-19 emergency. Social security frauds are when fraudsters

pretend to be from the Social Security Administration and need people to give them their social

security number or money. With medical frauds, scammers tell people they have a treatment or

product that could help protect them against COVID-19. Lastly, personal care frauds are when

fraudsters offer to do tasks for the elderly (such as picking up groceries) when they do not want

to go out. They then run away with the money they were given in order to do the errands. The

conditions set by COVID-19 have created an environment where the elderly are socially isolated,

making them more vulnerable for frauds (Payne, 2020). Additionally, the effects of COVID-19

caused people to lose their jobs and have less money, leading some to steal from their elderly

parents. In order to reduce the number of scams happening to the elderly, it is important to

inform them about the issue and how to protect themselves. Overall, “poor fraud awareness”

(Payne pg. 10, 2020) increases the elderly’s chances of being scammed.
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What Happens Next?

After someone finds out they have been scammed, it is important for them to take the

appropriate steps in order to decrease the financial impact the crime will have on them. It will

also increase their chances of finding those responsible and prosecuting them accordingly.

Steps to Take

The first thing someone should do is to cut off the criminals access to their money if they

still have an in. This includes contacting any banks or credit card companies to inform them of

the occurrence, canceling any cards linked to the accounts stolen, and resetting personal

identification numbers (National Council on Aging, n.d.). The next action someone should take

is to report the incident to the authorities in order to get retribution for the crime. Due to the

nature of the crime, it is important that the victim writes down everything they can remember of

the incident on a piece of paper. This includes how the scammer contacted them, what company

they said they were from, the name the fraudster gave them, and everything the scammer made

them do (Federal Bureau of Investigation, n.d.). From there, the person can contact Adult

Protective Services and a legal service in their area to discuss their next steps (National Council

on Aging, n.d.). Someone’s report also helps the new Transactional Elder Fraud Task Force in

the United States as they use public reports in order to know where they should be looking for

scammers (Mao, 2020). However, it is important to note that even when a bank was involved in

the transaction of the money in the crime, they cannot be held responsible for the actions of the

scammer. As determined by ​Abhyankar v. JPMorgan Chase (​ 2020), the holder of the account

has the freedom to do whatever they want with their finances, and it is not the job of the bank to

influence these transactions. Rather, if a family member wishes to protect their relative, they can
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appoint themselves as guardian over their accounts in order to make the elder less susceptible to

fraud (​Abhyankar v. JPMorgan Chase, ​2020).

Relevant Laws

One of the main federal laws that combats elder fraud is the S. 178 (115th): Elder

Abuse Prevention and Prosecution Act, which was enacted in 2017. This law focuses on

preventing elder abuse and exploitation by specifying how the U.S. Department of Justice must

act in regards to elder abuse cases. Additionally, it added and specified the types of fraud that

count as elder abuse and the corresponding penalty (GovTrack, 2020). Since its enactment, there

have been proposals to amend certain aspects of this law, such as the H.R. 8169: Elder Abuse

Protection Act of 2020. This proposal would add to the Elder Abuse Prevention and Prosecution

Act so that the resources it provides are also made available in Spanish. Currently, this bill was

sent to committee in each of the houses on September 15, 2020 for consideration (GovTrack,

2020). Another bill that has been introduced to Congress that relates to elder fraud is the H.R.

4453: Protecting Seniors from Health Care Fraud Act of 2019. Beginning its legislative process

on September 20, 2019, this bill aims to inform those on Medicare about health care fraud in

hopes of making them less likely to fall for it if someone tries to scam them in the future

(GovTrack, 2020). Then there was a resolution passed by the House in 2019 that advocated for

preventing elder fraud through informing different private organizations, law enforcement, and

financial establishments about the issue, as well as better enabling them to work together

(GovTrack, 2020).
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Why Target the Elderly?

It is a fact that the older population is disportionately affected by fraud (Payne, 2020), but

the question is what causes this to occur and why are the elderly an attractive target for

scammers to go after?

Financial Reasons

Having lived a long life, most senior citizens have more money and assets built up over

the years. They also tend to have better credit too as they have had time to pay off any debts they

might have had, thus improving their scores (Federal Bureau of Investigation, n.d.). Elders are

also less likely to notice any discrepancies in their financial accounts, making the chances of

them reporting the incident decrease (Sylvester, 2004, as cited in Cross, 2016). These factors

make elders an attractive target for scammers to go after as they have the funds to steal and are

less likely to notice they have been scammed.

Physical Reasons

Senior citizens also have several physical characteristics that make them appealing for

fraudsters. To begin with, seniors grew up in a time that people trusted each other more and most

continue to do so today. So they are more inclined to believe the scammer is from a real

company and give them their information (Federal Bureau of Investigation, n.d.). Elders are also

susceptible to the signs of age, causing people to view them as having less mental capacity as

their younger counterparts (Smith, 1999, as cited in Cross, 2016). Scammers will also target

seniors due to their belief that they will be confused by their fast talking while they are talking to

them, and it will then become easier to get information out of them (Wolf, 2000, as cited in

Cross, 2016). Additionally, elders are less inclined to report either because they are too
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embarrassed and do not want their family thinking they are not capable or because they do not

know how. Then, even if the senior ends up reporting it, the chances they will remember details

from the scam are less than those younger than them (Federal Bureau of Investigation, n.d.). All

of this creates the perfect target for a scammer as they have a greater chance of completing the

scam and then getting away with it.

Social Reasons

Generally in society, elders are viewed as vulnerable and weak. In order to figure out

why this perception existed, an interview was conducted of 21 volunteers who provide support

for elder fraud victims over the phone. The main reason the volunteers gave as to why elders

became fraud victims was due to isolation or being lonely (Cross, 2016). With one volunteer

saying “I’ve had many, many people tell me they can’t live without a spouse… they just want

somebody in their life. They’re very lonely” (Cross pg.6, 2016). This loneliness makes the elder

more vulnerable as they are looking to make a relationship with someone, something a scammer

will take advantage of for the fraud. They are especially susceptible if they live far away from

any family and they do not hear from them often. After establishing contact with the senior, the

scammer can then ask the elder for money (citing any number of reasons why they need it); and

wanting to help their new friend, the senior sends them the money. From there, the scammer can

keep asking for money until none is left. Afterwards, they will stop communicating with the

senior, leaving them to be isolated once more (Cross, 2016).

Precautions

In order to protect elders against frauds, there are several actions their families and they

can take. The first step an elder must take is to be aware that they are a target of frauds, both
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from someone close to them and complete strangers. Since once a senior comes to terms with the

fact they could get scammed, they are able to learn more about the issue and how to protect

themselves against it (National Council on Aging, n.d.). The next step that the elder should take

is to start looking into elder services in the area that allows them to participate in social events

despite any limitations they might have (e.g. inability to drive, cannot walk) (National Council

on Aging, n.d.). This socialization makes seniors less likely to fall victim to frauds as it prevents

them from isolating themselves, a characteristic of elders that fraudsters like to target in their

scams (Cross, 2016). Some other preparations that seniors can take is to shred any papers that

have sensitive information on them (e.g. credit card numbers) and signing up for do not call lists

to decrease their chances of fraud. Additionally, as a further precaution, the senior should drop

any mail containing private information into a secure collection box, if they are able, and set up

their benefit checks so it is a direct deposit into their accounts (National Council on Aging, n.d.).

Lastly, it is important for the elder to know how to act if they get a random call or email. The

first thing they need to note is to never give any sensitive information to any call, mail, or email

unless they initiated the call. The next thing they must remember is to never make a spontaneous

decision while on the phone. If they are contacted by any organization, familiar or unfamiliar, the

elder should always get in touch with the group in order to check to see if the story they were

told was true (National Council on Aging, n.d.).

Conclusion

In order to diminish the impact of elder fraud, the at-risk population must be informed on

the issue and given the tools they need to prevent scammers from taking advantage of them. The

issue continues to grow, most prominently this past year due to the impact of COVID-19. To
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reduce the number of cases, it is important to ensure elders have access to social interactions, so

they are not isolated, and are informed what to do if they find out they have been scammed. It is

better if the senior does not go into the issue alone if they are able. This puts the responsibility on

any family the elder might have to look after their senior relative. This includes keeping in touch

with them so they do not feel lonely (by contacting them every once in a while or by putting

them in a social group), helping them take the necessary precautions, and keeping track of their

behavior and finances to make sure nothing seems out of the ordinary. Legal guardians are

legally obligated to look after their children until they are of age, and even though it is not

defined by a law, the senior’s family should extend them the same courtesy as they are paying

their relatives back for all they have done for them.
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References

Abhyankar v. JPMorgan Chase (D.C. Cir. July 15, 2020).

https://scholar.google.com/scholar_case?case=8791235908955595310&q=%22elder+fra

ud%22&hl=en&as_sdt=1ffffffffffffffffffffffffffffffffe000000000000001f000001ffffffecff

f87fe3fffffff00108080000000000004

Cross, C. (2016). ‘They‘re Very Lonely‘: Understanding the Fraud Victimisation of Seniors.

International Journal for Crime, Justice and Social Democracy,​ ​5(​ 4), 60-75.

http://dx.doi.org/10.5204/ijcjsd.v5i4.268

Federal Bureau of Investigation. (n.d.). ​Elder fraud.​ Retrieved October 16, 2020, from

https://www.fbi.gov/scams-and-safety/common-scams-and-crimes/elder-fraud

GovTrack.us. (2020). H.R. 4453 — 116th Congress: Protecting Seniors from Health Care Fraud

Act of 2019. Retrieved from https://www.govtrack.us/congress/bills/116/hr4453

GovTrack.us. (2020). H.Res. 328 — 116th Congress: Supporting the protection of elders through

financial literacy. Retrieved from https://www.govtrack.us/congress/bills/116/hres328

GovTrack.us. (2020). H.R. 8169 — 116th Congress: Elder Abuse Protection Act of 2020.

Retrieved from https://www.govtrack.us/congress/bills/116/hr8169

GovTrack.us. (2020). S. 178 — 115th Congress: Elder Abuse Prevention and Prosecution Act.

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Mao, A. (Spring 2020). The U.S. Department of Justice Defends Against Elder Financial Fraud

and Abuse. ​Generations​, ​44​(1), 101-102.

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National Council on Aging. (n.d.). ​8 tips for how seniors can protect themselves from money

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rom-scams/

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Payne, B. K. (Aug 2020). Criminals work from home during pandemics too: A public health

approach to respond to fraud and crimes against those 50 and above. ​American Journal of

Criminal Justice : AJCJ,​ ​45(​ 4), 563-577. http://dx.doi.org/10.1007/s12103-020-09532-6

U.S. Department of Justice. (2019, October 18). ​Attorney General's annual report to Congress on

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WTKR. (2020, May 5). ​Virginia Beach businessman to serve 11 years for fraud targeting elderly

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eting-elderly-homeowners