Sadly, some dishonest people have focused their attention on senior citizens. Taking advantage of fear, hope, and trust, these scammers bilk thousands of older Americans each year out of much needed cash. If you receive a call, letter, or a personal visit from anyone claiming the following, chances are you’ve been contacted by a rip-off artist.
“You need a new roof.”
Many cons target older Americans because so many seniors are homeowners. It usually begins with a spontaneous visit from a “contractor.” He will offer a special repair deal for seniors, a free inspection, or he noticed something terribly wrong with your home that needs urgent attention. If you take the bait, you’ll likely be charged exorbitant fees to fix something that needs no fixing, the job will be done shoddily or not at all, or the price of the repairs will increase dramatically in the middle of the job.
Before hiring someone to work on your home, ask to see his contractor’s license number and check it with your state’s Contractors License Board. Get at least three other bids before making a final decision.
“I can get you a loan for that new roof.”
If you need to finance those home repairs (or pay for property taxes, medical expenses, etc.), watch out for predatory lenders who target older Americans. These businesses have a way of finding cash-strapped homeowners, offering home equity loans that come with outrageously high interest rates, unnecessary fees, and unreasonable repayment terms. Be extremely suspicious of loans that are marketed to people with bad credit, offers that are only good for a very short time, telephone applications, next-day approval with an immediate payment, or having to pay upfront fees to cover the first payment and other expenses.
Avoid doing business with sales people who initiate contact: reputable lenders rarely solicit business over the phone or in person. If you really need a loan, contact your financial institution.
“We can fix your bad credit.”
Preying on many seniors’ desire to maintain good credit, some scammers promise to erase negative items from a report – for hundreds of dollars. However, no matter what the company advertises, bad credit cannot be magically transformed into good credit. The only real way to improve your credit rating is through time and effort: pay what you owe; keep your balances down; and use credit responsibly.
The cost of real “credit repair”? Free.
“You’re a winner!”
Get a call or a letter saying that you have won a prize, but in order to claim it you need to send money to cover a shipping or handling fee, or pay for taxes upfront? Nonsense. You don’t have to pay for something you’ve won. As much as you want to believe that Lady Luck has finally paid you a visit, with an offer like this she probably hasn’t.
To be a real winner, toss this “award” in the trash.
“I can help you recover your loss from the win that never was.”
A particularly vile scheme is one that targets seniors who have already been swindled. Called recovery scams, a con typically poses as a government agency representative who is working on your case. A large sum of cash (which must be wired or sent to him immediately) is needed to conduct the investigation. To earn damaged trust, he may even provide phone numbers for the Better Business Bureau or other consumer agency (which are false, of course). Oh, and how did he know you had been ripped-off? He either bought your information from the con that took your money, or was the original swindler.
Remember, no genuine FBI agent, police officer, or any other law enforcement agent will ever ask for payment to do their job.
“I want to help you pay your bills.”
Or do they want to help themselves to the money in your checking and savings accounts? Certainly some seniors need assistance managing their financial affairs. If you do, be highly selective with the person you choose to help, particularly if he or she suggests (or leads you into suggesting) becoming a joint account holder. That person will have as much power as you do to withdraw funds, and can arrange to inherit every dime in the account at your death.
Get professional, objective legal advice before letting anyone have this kind of power over your finances.
“This seminar will change your life.”
Yes, it probably will – by making you a lot poorer. If someone you don’t know invites you to attend an investment or estate-planning seminar (often with a prize just for coming), stay home. These are often bogus operations that market heavily to retirees wishing to prepare their estate or increase a fixed income stream. Slick-talking salespeople convince attendees to divulge personal information that they will later use, or sell expensive but worthless products and services.
The bottom line: if you would like to take a class, go to your local community college or university; if you need investment advice, visit a reputable financial institution or brokerage house; and if you want to set up your estate, see an attorney.
Before doing business with anyone, contact the Better Business Bureau to verify that they are legitimate. If you’ve been scammed, report the crime to the police and the Federal Trade Commission. Nobody enjoys admitting they’ve been taken, but it is important to take action to stop these people and companies – before they bilk other senior citizens out of a lifetime of earnings.
Better Business Bureau: 219.769.8053
Federal Trade Commission: 877.382.4357