Common Financial Fraud Affecting Victims Over 60

Anyone can become a victim of fraud. However, the elderly are particularly vulnerable to fraud due to their advanced age, likelihood of living alone, and perceived tendency to be trustful of others. Financial fraud committed against the elderly is a form of financial elder abuse, and it can have serious repercussions on its victims’ financial, emotional, and even physical well-being. Each year, the FBI’s Internet Crime Complaint Center (IC3) publishes the Elder Fraud Report, an exhaustive study of the most common types of fraud perpetrated against victims over the age of 60. While the methods of fraud and financial elder abuse differ widely, they all have one objective — to steal money from older victims. If you or someone you care about has been harmed by financial fraud, a California financial elder abuse attorney can help you recover. 

Investment Fraud

Investment and securities fraud are among the most serious forms of financial elder exploitation, as many dishonest investment advisors or stock promoters present their schemes so convincingly that their victims invest vast sums of money into them — in some cases, even their life savings. There is a wide range of fraudulent investment schemes out there, and investment scammers are a creative bunch who are always devising new ways to steal money from their victims. While the methods of investment fraud vary, they typically involve the wrongdoer presenting an investment scheme as a low-risk, high-return investment opportunity. The wrongdoer then keeps the money the victim invests, leaving the victim with little or nothing. 

Some common types of investment fraud that target seniors include: 

• Ponzi schemes: A fraudulent investment scheme that pays existing investors with funds invested by new investors. While early investors see great returns on their investment (thus creating the appearance of legitimacy), the scam eventually collapses, leaving later investors with nothing. Multilevel marketing operations — although technically not Ponzi schemes and therefore not illegal — operate in a similar fashion, making them a poor investment choice for seniors. 
• Advance fee fraud: A fraudulent investment scheme where the wrongdoer requires the victim to pay a fee up front before they receive a benefit, such as money, products, or services. The wrongdoer then takes the fee and the victim receives nothing. 
• Real estate fraud: A broad category of fraud involving real estate. Can include reverse mortgage scams, foreclosure rescue scams, loan flipping, escrow fraud, rental scams, moving scams, and deed fraud, just to name a few. The most serious real estate frauds typically result in the victims losing their house or a substantial portion of the equity in it. 
• Pump and dump schemes: A fraudulent investment scheme where the wrongdoer artificially inflates (i.e., “pumps”) the value of a stock through false or misleading information and then sells their shares (i.e., “dumps”) at the inflated price. The value of the stock typically plummets after the scammers dump their shares and stop pumping its value, leaving other shareholders with significant losses. 
• Annuities: An annuity is a contract offered by a life insurance company that provides the buyer with a fixed set of payments over a specified period of time in exchange for an upfront, lump-sum payment. Annuities are not inherently fraudulent, but selling an improper annuity to an elderly person can constitute financial elder abuse, as many annuities do not begin paying benefits for at least 10-20 after purchase. 

The IC3 report estimates that fraudulent investment schemes cost elderly victims nearly $1 billion in 2022. 

Investment scams can be particularly devastating for seniors. If you suspect that someone you care about is being defrauded in an investment scam, you should act quickly to protect their assets. A California financial elder abuse attorney can help you identify potential investment frauds and pursue legal action against their perpetrators. 

Fight Back Against Scammers With Help From a San Francisco Financial Elder Abuse Attorney 

Financial fraud committed against the elderly is widespread and, according to the IC3 report, is on the rise. The good news is that California law allows for private civil causes of action against the perpetrators of fraud and, in some cases, permits enhanced damages for fraud committed against the elderly. The best way to fight back against those who would defraud seniors is with the assistance of an experienced attorney. To get started, please contact a California financial elder abuse attorney at the Evans Law Firm, Inc., by using our online contact form or calling 415-441-8669 or toll-free at 1-888-50EVANS (888-503-8267).