Elderly Financial Abuse — Definitions and 3 Sample Cases (5 Articles)
~ Friday, October 20, 2023 Blog Post ~
Article #1: Elder Abuse and Elder Financial Exploitation Statutes (From the United States Department of Justice — Elder Justice Initiative)
Citation Civil Financial Exploitation
Cal Wel & Inst Code § 15610.30 & § 15610.23 (2022)
Statute
WELFARE AND INSTITUTIONS CODE
Division 9. Public Social Services
Part 3. Aid and Medical Assistance
Chapter 11. Elder Abuse and Dependent Adult Civil Protection Act
Article 2. Definitions
§ 15610.30. Financial abuse
(a) “Financial abuse” of an elder or dependent adult occurs when a person or entity does any of the following:
(1) Takes, secretes, appropriates, obtains, or retains real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.
(2) Assists in taking, secreting, appropriating, obtaining, or retaining real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.
(3) Takes, secretes, appropriates, obtains, or retains, or assists in taking, secreting, appropriating, obtaining, or retaining, real or personal property of an elder or dependent adult by undue influence, as defined in Section 15610.70.
(b) A person or entity shall be deemed to have taken, secreted, appropriated, obtained, or retained property for a wrongful use if, among other things, the person or entity takes, secretes, appropriates, obtains, or retains the property and the person or entity knew or should have known that this conduct is likely to be harmful to the elder or dependent adult.
(c) For purposes of this section, a person or entity takes, secretes, appropriates, obtains, or retains real or personal property when an elder or dependent adult is deprived of any property right, including by means of an agreement, donative transfer, or testamentary bequest, regardless of whether the property is held directly or by a representative of an elder or dependent adult.
(d) For purposes of this section, “representative” means a person or entity that is either of the following:
(1) A conservator, trustee, or other representative of the estate of an elder or dependent adult.
(2) An attorney-in-fact of an elder or dependent adult who acts within the authority of the power of attorney
Source:
Article #2: Reporting elder financial abuse (From the Consumer Financial Protection Bureau)
Reporting elder financial abuse
Help for family and friends of people living in nursing homes and assisted living communities
There are four steps to help protect your loved ones from financial abuse:
- Prevent
- Recognize
- Record
- Report
This resource focuses on the final step, “Report.” To learn about the other steps and get more information and resources, read our guide, Preventing elder financial abuse.
What is financial abuse?
Financial abuse is when someone takes or misuses another person’s money or property for the benefit of someone other than that person. For example, neighbors, caregivers, professionals, and even family or friends may take money without permission, fail to repay money they owe, charge too much for services, or not do what they were paid to do. Financial abuse — sometimes called financial exploitation — is a form of elder abuse. To learn how to recognize the signs of financial abuse, read the guide on protecting people who live in nursing homes and assisted living communities .
As a family member or friend, you are in a unique position to help protect your loved ones from financial abuse. If you suspect financial abuse, you should report your suspicions to the appropriate authorities. This resource explains how to report elder financial abuse.
Where should I report financial abuse?
- If you suspect elder financial abuse, report it to Adult Protective Services (APS). APS are social services programs in each state. They serve older adults and adults with disabilities who need help due to abuse, neglect, or exploitation. Adult Protective Services is a common term, but this may not be the name of the agency in your state. Find your local APS .
- If there is an urgent risk of harm to your loved one or someone else, you should call 911 right away. Otherwise, you can call the non-emergency number for your local police or Sheriff’s office to file a report. Some state laws define elder financial abuse as a specific type of crime. Financial abuse may also involve other crimes such as theft, fraud, forgery, embezzlement, or money laundering.
- You can also report financial abuse to your local District Attorney’s office and ask them to prosecute the person who took advantage of your loved one.
What information do I need to file a report?
Include as much information as possible in your report. Plan to share what you have observed. Even if you don’t have all of the details, you should still file a report. The authorities who will investigate the situation do not expect you to know everything.
- Time, date, and location of the incident(s)
- Names of anyone who was involved and anyone who observed the incident(s)
- Description of the suspected financial abuse and any other types of abuse or neglect
- Your loved one’s disabilities or health conditions, including any information about decision-making abilities or memory loss
- Whether you believe there is an urgent risk of danger to your loved one or someone else
What other types of help are available?
- Long-term care ombudsmen help people living in nursing homes, assisted living communities, and similar adult care communities. Ombudsmen can advocate for your loved one and help solve the problem. Every state has an Office of the State Long-Term Care Ombudsman. Find your ombudsman .
- If your loved one has a social worker, elder patient advocate, or someone in a similar role, consider asking that person for help.
- If there is a resident and family council in your loved one’s community, you could tell the council about the situation and ask for help. Resident and family councils are groups of family members who work together to help people living in nursing homes and assisted living communities and their families.
- If the financial abuse involved a financial account, work with your loved one to contact their bank, credit union, credit card company, or other financial services provider as soon as possible. Depending on the situation, the financial institution may be able to get your loved one’s money back. You can also check whether your loved one has any insurance that might cover the loss.
Problems with an assisted living community or nursing home team member
- If you suspect that a care team member or volunteer of your loved one’s assisted living community or nursing home may be financially abusing them, report your concerns to the administrator or the team member responsible for receiving reports of abuse. If the problem is not resolved, you should be able to file a grievance, complaint, or both.
Where does your loved one live? / You can report to
Nursing home
- State survey agency that oversees Medicare-certified or Medicaid-certified nursing homes
- State licensing board for the perpetrator, if the perpetrator is a licensed professional
Assisted living community
- Assisted living licensing boards
- State licensing board for the perpetrator, if the perpetrator is a licensed professional
Problems with financial caregivers
- If you suspect that a Social Security representative payee is misusing your loved one’s Social Security benefits, contact the local Social Security office or call the Social Security Administration at 800–772–1213.
- If you suspect that a fiduciary appointed by the Department of Veterans Affairs (VA) is misusing your loved one’s benefits, contact the VA .
- If you suspect that a guardian or conservator is misusing your loved one’s money or property, contact the court that appointed the guardian or conservator. Most courts have procedures for receiving and investigating complaints.
Scams
- If the situation involved a scam, report it to the Federal Trade Commission (FTC) .
- If the scam used the U.S. mail, report it online to the U.S. Postal Inspection Service (USPIS) or call 877–876–2455.
What legal options might we have?
You may want to talk to a lawyer to find out whether your loved one has any legal options. Local civil legal services programs (often known as “legal aid”) may be able to help for free, or you can hire a private lawyer. Search for legal services programs in your area .
- Some states have laws to help survivors of financial abuse file cases in civil court to recover their money.
- Some states have a way to temporarily freeze bank accounts or put a hold on property transfers to stop the financial abuse. Some states allow banks, credit unions, and other financial institutions to put a transaction temporarily on hold when they suspect elder financial abuse.
- You may also be able to file a case in civil court to request a “restraining order” or “order of protection.” A judge can issue one of these orders, which says the perpetrator can no longer contact your loved one. This can help separate the perpetrator from your loved one and prevent further harm.
Where can I find more information?
Sources and references:
Article #3: How this 77-year-old widow lost $661,000 in a common tech scam: ‘I realized I had been defrauded of everything’ (From CNBC)
By Greg Iacurci, October 8, 2023
KEY POINTS
- Marjorie Bloom, a retired civil servant, was the victim of a “tech support” scam in 2021. Criminals used cryptocurrency to carry out the fraud.
- Bloom, now 77, lost her life savings: $661,000.
- Her experience highlights the growing threat of fraud that targets older adults.
In the spring of 2021, Marjorie Bloom waited for a phone call that would never come.
Over the course of the previous month, the retiree had wired hundreds of thousands of dollars into cryptocurrency per the suggestion of someone she believed to be a trusted confidant. The man claimed to be a “fraud investigator” at PNC Bank, where she’d been a longtime customer.
At his behest, Bloom, a widow who is now 77, liquidated her nest egg — savings, stocks, an annuity — for a total of $661,000.
The action was supposedly preventative: The “investigator” persuaded Bloom that criminals, using stolen personal data, were in the process of pilfering her life savings. To protect her money, he said, she had to move it quickly — and covertly. Divulging the problem to anyone, even her three children, could compromise their efforts, he said.
Had she alerted her children, she might have avoided the scam: Bloom’s daughter, Ester, is the deputy managing editor for CNBC Make It. (Ester Bloom put CNBC in touch with her mother but was not involved in the reporting or editing of this story.)
The “investigator,” though very convincing, turned out to be a wolf in sheep’s clothing. Bloom, a retired civil servant, was ensnared in a “tech support” scam.
This type of fraud is increasingly common and largely targets older adults, who lost $588 million to tech support scams in 2022, according to the Federal Bureau of Investigation. Criminals persuade victims they have a serious computer issue such as a virus, then masquerade as computer technicians from well-known companies as a cover for theft. Often, they persuade victims to wire funds to fraudulent accounts.
So on that Friday morning in May 2021, Bloom eagerly awaited a call with instructions on how to access the life savings she had diligently taken steps to secure.
The hours ticked by. Growing nervous, she eventually called the “investigator.” His number had been disconnected. She called PNC, but the bank didn’t have a record of the employee.
“All of a sudden, this grayness lifted,” said Bloom, who lives in Chevy Chase, Maryland. “I realized I had been defrauded of everything.”
‘The money is there. The scammers know that’
Bloom’s experience reveals an unsettling reality at a time when technological advancement, little-understood investment options and a patchwork of protections in the U.S. financial system expose more older Americans to financial fraud.
Americans 60 and older lost $3.1 billion to cyber fraud in 2022, an 84% increase from 2021, according to the FBI. Losses have jumped ninefold in just five years, from $342 million in 2017, FBI data shows. Because fraud statistics are based only on reported incidents, its true scope may be far greater.
Older adults, many of whom have saved their entire careers for retirement, can have the most to lose. In addition to retirement savings, they might have other pots of income and wealth: home equity, Social Security payments, pension checks and, if widowed, maybe a life insurance payout.
“The money is there,” said Rebecca Keithley, a supervisory special agent in the FBI’s Economic Crimes unit and the bureau’s national program coordinator of the Department of Justice’s Elder Justice Initiative. “The scammers know that.”
Keithley — also the FBI’s national program coordinator for frauds and swindles — is not involved in the investigation of Bloom’s case.
Meanwhile, the U.S. is undergoing a massive demographic shift as an average of 10,000 baby boomers hit retirement age every day. This generation has shouldered more responsibility for their retirement preparations as employers began shifting away from pensions to 401(k)-type retirement plans decades ago.
Consumers ages 65 and older had an average of $232,710 in 401(k) plan savings in 2022, according to Vanguard Group, one of the nation’s largest retirement-plan administrators. Further, 65- to 74-year-olds had a net worth of more than $1.2 million, on average, in 2019, according to the Federal Reserve’s most recent Survey of Consumer Finances.
Fraud may deprive victims of funds for basic living expenses such as food and shelter, or for the travel and leisure they’d worked so hard to attain in their post-work life.
Beyond the immediate financial hit, fraud has several knock-on effects: Victims who raid their tax-preferred retirement funds may owe the IRS a hefty bill. Taking out a second mortgage or maxing out credit cards carry regular debt payments.
Older adults don’t have the same ability as younger victims to earn in the workforce, and it’s often challenging to recoup money from criminals or financial institutions.
“Most victims will say, ‘I’m devastated financially, I’m ruined,’” said Kathy Stokes, director of fraud prevention programs at AARP, an advocacy group for older adults. “But emotionally it’s as bad, if not worse.”
How criminals ‘hijack’ the aging brain
Tech support scams like the one Bloom suffered are an acute threat for older adults.
They are a type of “call center” fraud, which “overwhelmingly target” older adults, the FBI said. About half of people victimized by illegal call centers are 60 or older, and they experience 69% of the total financial losses relative to other age groups.
Nearly 18,000 Americans ages 60 and over reported being a victim of tech support scams in 2022, the FBI said. That’s more than any other type of elder fraud and almost doubled from 2020.
Victims 60 and older lost more to these scams than all other age groups combined, the FBI reported. The average person lost $33,000, though losses extended to over $1 million in some cases, the FBI said.
In Bloom’s case, her computer froze suddenly on April 22, 2021. A popup window alerted her to call a customer support phone number listed on the screen, supposedly for Microsoft.
Bloom then made a key mistake: She called the number, an action that real tech companies won’t ever ask of customers in a security pop-up warning.
During the call, a “Microsoft engineer” told her that foreign hackers had hijacked her computer and stolen sensitive personal data. Her financial accounts, he suggested, were also likely under threat.
When Bloom told him she banked with PNC, the engineer — who was really a con artist — transferred her to an accomplice posing as a PNC fraud investigator. The man convinced Bloom that there were pending transactions worth $29,000 tied to her bank account. Her money had to be moved without delay to a new account, the scammer urged.
None of it was true.
“I fell for it,” said Bloom, who retired in December 2017 after serving 42 years as a federal attorney, including stints at the Department of Energy and, most recently, the Pension Benefit Guaranty Corporation.
“I didn’t tell anybody,” Bloom added.
The appearance of an immediate threat is an “age-old psychological technique” common in frauds that tends to be “more successful with the aging brain,” said Keithley of the FBI.
In this technique, known as an “amygdala hijack” in reference to the brain’s fear and threat response center, criminals trigger strong emotional reactions that overwhelm the rational part of our brains. We act rather than think, a classic fight-or-flight response — in this case induced by nefarious social engineers, often part of sophisticated organized crime networks.
Older adults tend to be home more often, use landline phones and be generally unsophisticated about technology and safe online behavior — all of which make them vulnerable and therefore frequent targets, Keithley said.
The Covid pandemic was a disproportionate threat to older adults, keeping Americans indoors and quickly pushing them online. The health emergency “ushered in a new wave of exploitative practices targeted at older Americans,” U.S. Attorney General Merrick Garland said in a 2022 report to Congress.
‘Somebody should have asked’
Bloom, an avid traveler, is undeniably tough. In 2013, at 67 years old, she trekked to the base camp of Mount Everest, the world’s tallest mountain; the base camp alone sits at an altitude of about 18,000 feet.
But the scam tested her resolve.
A year after the fraud, Bloom set out on a road trip to North Dakota. Five days in, she had a panic attack that seized the right side of her body in pain. She canceled everything and went home.
“In retrospect, I think the entire ordeal was a fearful reaction to spending money,” Bloom said.
Before she realized she’d been scammed, Bloom had made five wire transfers within 28 days, amounting to $661,000, according to receipts of the transactions, which were reviewed by CNBC.
Much of those funds came from liquidating a stock portfolio — an inheritance from her parents — worth more than $400,000. She also liquidated the bulk of an annuity worth more than $200,000; if she’d kept it intact, it would have begun paying her a guaranteed income stream of about $2,700 a month for the next three decades, starting in 2023.
“This was my life savings,” Bloom said. “It’s what I was going to live on as a retiree.”
When she discovered the loss, Bloom’s immediate thought was of her three kids: a “profound disappointment” at squandering the reserves she’d intended to bequeath them. Bloom had wanted to offer the same financial assistance to her children as her parents had provided for her. Now, much of that money is gone, she said.
Her second concern was for her own financial security. Bloom still receives regular checks from a federal pension and Social Security, now her main sources of retirement income. It’s enough to cover her mortgage, condo fee, car payment and other necessities — but the financial loss exposes Bloom to sacrifices nonetheless.
For one, she laments an inability to travel as frequently as she’d hoped in retirement. She is a member of the North Bethesda Camera Club and uses trips as an outlet for photography, a hobby that developed during her Everest expedition.
“I’m not starving,” Bloom said. “But I could do a lot more [if I hadn’t lost money].”
“I’ve lost a significant amount that I’ve worked for,” she said.
All of a sudden, this grayness lifted. I realized I had been defrauded of everything.
Marjorie Bloom
MARYLAND RESIDENT
Bloom sued PNC Bank — where she’d been a customer for over a decade — in May 2022 for full financial restitution and other damages, such as interest and attorney’s fees.
In her lawsuit, Bloom argued that the fraud was ultimately successful because PNC ignored “obvious red flags” and “textbook evidence” of financial exploitation raised by her wire transfer requests, which were inconsistent with her typical pattern of banking.
According to the lawsuit, the bank didn’t take steps to investigate or determine whether her money was at risk. The lawsuit claimed the bank acted negligently and breached its contractual duty of care.
“I’m retired … [and] I look my age,” Bloom said. “There’s just no doubt about it.”
“Somebody should have asked,” she added.
In February, a federal judge in the District of Columbia dismissed the negligence claim but allowed the claim for breach of contract to move forward in court.
Bloom and the bank settled the lawsuit in September. Bloom declined to disclose terms of the agreement to CNBC. (Bloom’s comments to CNBC for this story occurred in the spring, before the parties entered into settlement negotiations.)
A spokesperson for PNC Bank declined comment on the settlement.
Asked about the lawsuit in the spring, the bank said it acted within the scope of its legal duty.
“PNC maintains a comprehensive set of security controls to help protect our customers from increasingly sophisticated fraud threats and, when possible, we do our best to recover funds on behalf of impacted customers,” a spokesperson told CNBC, when asked about Bloom’s case and statements about the bank.
“While PNC regrets any losses incurred by a customer, we disagree with the allegations in this case and believe we acted appropriately with respect to these transactions,” the spokesperson added.
‘You’re basically at the mercy of your bank’
Lawsuits such as Bloom’s are rarely successful, legal experts said. Outcomes hinge on a complex web of federal and state rules that govern banking and elder financial fraud.
For instance, there’s a distinction between “unauthorized” and “authorized” banking transactions.
Unauthorized transactions occur when criminals get hold of a customer’s personal information — a debit card number, let’s say — and buy something without approval. Customers are often reimbursed in such instances.
However, in Bloom’s case, she made the wire transfers. Transactions initiated by a customer — even a victim duped by scammers — are generally considered “authorized,” said Carla Sanchez-Adams, senior attorney at the National Consumer Law Center. And such transactions carry weak customer protections, she said.
“You’re basically at the mercy of your bank,” Sanchez-Adams said.
Wire transfers also have weaker protections than other types of electronic fund transfers — such as debit card, ATM or peer-to-peer transactions, for example — because they’re exempt from the Electronic Fund Transfer Act, a federal consumer protection law passed in 1978, she said.
I’m retired … [and] I look my age. There’s just no doubt about it. Somebody should have asked.
Marjorie Bloom
FRAUD VICTIM
Another federal law — the Bank Secrecy Act — sets standards for banks to ensure they have controls to prevent and detect crime such as money laundering and terrorist financing. While the law requires banks to file reports to regulators in certain cases to flag suspicious activity, it doesn’t give individual consumers a legal remedy to recoup money lost due to criminal enterprise, Sanchez-Adams said.
“Banks should have some skin in the game,” Sanchez-Adams said. “If you don’t make them hurt, they won’t change their practices.”
Some states have elder-protection laws that establish separate duties to protect older adults from financial fraud, but they vary broadly in scope, she said.
For example, under Maryland law, banks are required to report suspected elder fraud to local law enforcement and other parties. As Bloom argued in her lawsuit, that means employees have likely received training to identify such activity. Such “heightened procedures” to protect older adults are part of the bank’s duty of care relative to older customers, the lawsuit said.
To sidestep internal protocols — which most banks have established, according to industry data — scammers will often coach victims on what to say to bank tellers or other representatives, experts said. Perhaps the money is for a loan, or for a home-improvement project, for example. Bloom didn’t require coaching, she said; according to her lawsuit, PNC bank employees didn’t perform more than a “perfunctory inquiry” necessary to complete the transfers.
And there’s an additional tension: Banks and other financial institutions have to weigh issues such as consumer privacy when choosing to intervene, said Marve Ann Alaimo, a partner and elder law expert at Porter Wright Morris & Arthur.
If the bank reasonably does its best to protect a client and there’s still financial damage, it isn’t necessarily the bank’s fault, she said.
“We live in a free-market economy. And when you own something, you have the ultimate right to dispose of it as you wish,” Alaimo said, referring to money held in a financial account.
“There’s only so much protection a third party can provide for you,” she added. They “aren’t the ultimate arbiter of free will.”
Cryptocurrency gives thieves ‘new advantages’
Meanwhile, Bloom’s money apparently went on a global tour.
Scammers had her wire funds from her PNC bank account to an account at the now-defunct Signature Bank in New York. According to the lawsuit, from there, her money was transferred to an account on the cryptocurrency trading platform Coinbase, which scammers created using Bloom’s picture and personal data. The assets were then converted into cryptocurrency — a type of virtual asset — and, an investigation later showed, moved to offshore accounts on the Binance crypto trading platform in the Cayman Islands.
Thieves have successfully used crypto to steal increasing amounts of money across all types of internet scams, according to the FBI.
In this context, cryptocurrency — examples of which include bitcoin and ethereum — is like cash; it’s just another way to move money from Point A to Point B. But crypto “offers up new advantages” for thieves who transfer and launder illicit proceeds, said Patrick Wyman, chief of the FBI’s Virtual Asset Unit. Wyman is not involved in the investigation of Bloom’s case.
For one, using crypto is an easy way to move large sums of money across borders very quickly without having to engage with the financial system, Wyman said.
Another benefit for scammers: Crypto offers them a level of anonymity. Criminals use the digital assets to obfuscate their real identity — which, by the nature of crypto transactions, is difficult if not impossible to ascertain.
However, unlike with traditional financial transactions, which are private, all crypto transactions are recorded on a public ledger, or blockchain. So, while law enforcement officials may not be able to learn the identity of a perpetrator, they can generally trace the flow of money, Wyman said.
And that offers a silver lining for victims: “In some cases, we absolutely are able to recover those funds,” Wyman said.
In April, the U.S. Department of Justice seized more than $112 million worth of virtual currency linked to crypto investment scams. The assets were seized from six accounts, one of which held $66.4 million, likely tied to wire fraud schemes, the DOJ said.
Wyman encourages victims to report fraud to the FBI’s Internet Crime Complaint Center as soon as possible. It generally gets harder to recoup money the longer victims wait, he said.
Bloom reported the theft to the FBI; her case remains open. She’s not optimistic about her chances of recovering money via law enforcement efforts. Even if the authorities are successful, she expects it will take years.
“I oscillate,” she said of her reflections on the theft.
“I go from being thoroughly upset and [asking] ‘What in the world was I thinking?’ to saying ‘You just have to move forward. What’s done is done.’”
Sources:
https://twitter.com/CNBC/status/1715129729899004400
Article #4: Romance scam: Widow swindled out of life savings, finds out she has no home or companion (From ABC 7 Chicago)
By Diane Wilson, September 23, 2023
Video: https://abc7chicago.com/video/embed/?pid=13811103
CARY, N.C. — Finding love cost a woman more than $70,000. After losing her life savings, she’s sharing her story to try and save others from the same emotional and financial heartbreak.
This scammer didn’t just act fast trying to get this woman’s money. He fostered a relationship with her for months, just long enough for her to let her guard down.
“How he did it, I don’t know but it all looked legitimate,” Jennifer Dennis said.
Dennis still can’t believe she lost her life savings to a man she met on online.
“I’m out all that money and I don’t think I’ll ever get it back and at 76, I don’t have a whole lot of future,” Dennis said.
This all started when Dennis was living in Georgia and as a widow was looking for companionship. On Facebook, she met a man who went by Caleb.
“He was coming back to the states real soon, and he was wanting to settle in a new area because he had lost his wife,” she recalled.
In the online chats, Caleb claimed to be in Yemen — a doctor working for the Red Cross. During their months-long online relationship, Caleb proposed they buy a house in Cary, North Carolina so they could start their lives together in a new place.
A plan Dennis was open to since the pain of her late husband was everywhere.
“Everything about the house and the area reminded me of my husband, which was just heartbreaking,” Dennis said.
The deal would be that Caleb would pay $600,000 towards it, and she would pay the remaining $70,000 owed. Dennis thought it seemed like the perfect deal, so she wired $70,000 and then an additional $8,700 for other expenses.
She, along with her son Raymond, packed up everything they owned and drove to Cary thinking they’d move into the new home.
“When I noticed that someone was still living in the house and knocked on the door, I automatically knew that it was a scam,” Raymond said. The owner of the home told them he had lived in the home for years and had no intention of ever selling.
Dennis contacted Caleb right away.
“He sent me a picture of him — (he had) supposedly been beat up. That was the last time I heard from him,” she said.
Scammed, in a new area and with all of her money gone.
“We didn’t have any place to go. We ended up in our car sleeping,” Dennis said.
Eventually, a generous person from their church provided them with this camper to live in. Dennis is now sharing her story, hoping others looking for companionship online, don’t fall for the same romance scam she did.
“I think that it’s devastating for me, but I have my son, which has been a blessing. So some women are totally alone and they get scammed like that,” Dennis said.
Dennis is not alone as just last year more than $1.3 billion was lost in romance scams, according to the Federal Trade Commission.
The big red flags with romance scams, all communication happens online and they give you a sob story. Also, anytime they ask for money, whether that be they want you to wire it, buy Bitcoin, or gift cards, it’s all a sure sign it’s a scam.
Sources and references:
https://abc7chicago.com/dating-sunday-2023-romance-scams-online-apps/12675817/
https://abc7chicago.com/romance-scam-cary-nc-facebook-account-scammer/13815485/
https://abc7chicago.com/romance-scam-online-dating-escaped-inmate-patrick-giblin/12554451/
https://www.straitstimes.com/stop-scams
Article #5: Over $1m lost in 15 days: S’porean retiree loses life savings in scam by fake Facebook friend (From The Straits Times)
By Aqil Hamzah, October 17, 2023
SINGAPORE — Accepting a Facebook friend request from a stranger who asked for help has turned into a nightmare for a 65-year-old Singaporean retiree, who then lost her life savings of $1,078,053.62 in only 15 days.
Madam Tan (not her real name) met a man, “Alvin”, on the social media platform in August, and he claimed to be the Singaporean chief executive of an interior design firm in Britain. He said he was about to complete his final project — a hotel in London — before retirement.
Alvin then asked her to facilitate payments for him — he told her that he could not procure materials from companies in China, and had been referred to a particular one in Sabah. But as he could not speak Mandarin, he needed her to act as an intermediary.
As she was initially distrustful, he made “bank transfers” to her account that were worth more than the cost of the materials, reassuring her that it would be credited within the span of two to four days. He even showed her transfer statements from British bank Barclays that not only eased her fears, but also convinced her to part with her money.
Except that it was all a ruse.
The transfer statements Madam Tan received, seen by The Straits Times, had telltale signs that they were fake. First, there were the different font sizes used across the three documents. The dates also appeared to be formatted haphazardly, ranging from “Sep 04” to “Sep 5” and then “Sep 07”, among other inconsistencies.
ST has contacted Barclays with copies of the alleged transactions to verify if they are genuine.
Between Sept 4 and 19, however, Madam Tan did not know any better. Although she was aware that she had not received any deposits into her bank account, she believed the scammer, who had told her the transfers would take a few days to be processed.
When told that she needed to continue making payments for additional fees such as shipping and taxes, she made 22 transfers of at least $20,000 each.
For her final transaction of $50,000, she even borrowed money from her 30-year-old son.
She said: “I had to take out money from my CPF account, and even took a bank loan of $24,000 to continually make the payments.
“I didn’t have enough money and asked my son for $10,000, which made him suspicious, but I told him that it was for a business opportunity, and that I would repay him when my fixed deposits matured.”
However, she had already withdrawn her fixed deposits by then to fund the transactions.
The scam was finally uncovered on Sept 20, after Madam Tan received a phone call from a Malaysian number and was told that her British “business partner” was detained at the airport for having too much cash on hand. Alvin also told her the same story, which made it all the more believable.
She was told that in order for him to be cleared by the Malaysian authorities, she needed to pay $98,000.
However, before she could approach her 32-year-old daughter for money, her son stopped her, telling her the large sums being requested were sure signs that she was being scammed.
When she attempted to contact the scammers to confront them, they ignored her.
Of the three phone numbers that Madam Tan provided ST with, calls and messages to two lines went unanswered. The third number, which she had used to contact the alleged scammer via WhatsApp, was no longer linked to the messaging app.
“My children are so worried about me now, because it looks like I cannot retire already,” said Madam Tan, who declined to state her children’s occupations.
“I’ve been very frugal throughout my life. I worked when I was younger, and the money I saved was for me to use for healthcare in my older years, but now I’ve not only wiped out 40 years of my savings, I’m also in debt because of the bank loan.”
She added that she has filed two police reports. The police confirmed they are investigating the matter.
Her daughter also helped her to write to UOB and Standard Chartered, which she has accounts with, as well as DBS Bank and OCBC Bank, where she had transferred the money to, for help.
All four banks told ST that they will assist the police with their investigations.
A UOB spokesman said: “We regret that Madam Tan fell victim to an investment scam. It is understandably a difficult time for her and her family.”
He added that bank transfers above $5,000 require authentication through UOB’s digital token, and stressed that the security measures adopted by banks are not foolproof. “Our customers remain the singular most effective defence, and we strongly urge them to exercise vigilance and caution in this ever evolving threat landscape.”
Standard Chartered said: “We have strong security measures in place to monitor suspicious transactions, and continue to urge all clients to stay vigilant.”
Madam Tan is among a growing number of scam victims.
In the first half of 2023, there were 22,339 scam cases reported, a 64.5 per cent rise from the 13,576 reported during the same period in 2022.
Victims lost a total of $334.5 million from January to June, a slight dip from the $342.1 million that was lost during the same period last year.
Source:
