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NASHVILLE — The Tennessee Department of Commerce & Insurance’s (TDCI) Securities Division is reminding Tennesseans that social isolation, whether voluntary or involuntary, has a direct contribution to the financial exploitation of older investors. TDCI’s reminder comes ahead of National Senior Fraud Awareness Day which takes place on Saturday, May 15.
The Government Accountability Office has estimated that seniors lose an estimated $2.9 billion annually nationwide to an ever-growing array of financial exploitation schemes and scams. The Federal Trade Commission estimates over $40.6 million in total consumer fraud losses occurred in Tennessee during 2020 with identity theft being the top type of fraud complaint.
“While financial abuse can happen at any time, perpetrators often strike during times in a senior’s life when they may be more vulnerable, such as during a health crisis or after the death of a loved one,” said TDCI Assistant Commissioner Elizabeth Bowling. “Scammers often gather personal details from obituaries and social media posts and use this information to target their victims. Some also may attempt to exploit trust within seniors’ social and support groups to become more involved in their lives.”
Unfortunately, senior fraud is often underreported by victims due to embarrassment and lack of information about where to report fraud. Social isolation and diminishing cognitive capacity can combine to affect the judgment and decision-making capacity of senior investors, rendering them more vulnerable to financial abuse. Over the past year with many seniors in isolation during the heart of the pandemic – they were even more vulnerable to financial abuse.
“When seniors and others are socially isolated, they increasingly turn to the Internet for social interaction and more frequently depend on the Internet as a social outlet and are increasingly relying on online services for shopping, banking and the initiation of electronic payments that may have otherwise been paid in person,” said Bowling.
“Research shows that people who are contacted by scammers through social media or through a pop-up message on a website are more likely to engage with the scammer and lose more money than those who were targeted by phone or email.”
What can you do to help a senior loved one in your life? Remember:
Stay in-touch with loved ones.
Be sure to keep in touch with older family members, friends and neighbors. Visit them in-person if possible, call or leave a note on their front door. If they have the technology send them a text or email, or connect through video conferencing. Regular contact is key to letting loved ones know you are thinking of them and that they are not alone.
Let your older family members know that fraudsters and scammers have found ways to exploit the pandemic.
Make them aware of the red flags of fraud and common scams, which remain consistent over time. Send them updates on current scams targeting older people.
If a scam occurs, report it to local law enforcement.
Don’t let embarrassment or fear keep you from reporting investment fraud or abuse. Con artists know that you might hesitate to report that you have been victimized in financial schemes out of embarrassment or fear. Every day that you delay reporting fraud or abuse is one more day that the con artist is spending stolen money and finding new victims.
A new blog post related to National Senior Fraud Awareness Day written by TDCI Director of Investor Education Rachel Carden can be found here.