Fake Government Scams - Do Not Fall for Fraud

Most of us are afraid to simply hang up on someone who says they are a government official, especially if they insist they are contacting us on behalf of some state or federal agency.  Sadly, scammers are now taking advantage of this fear by impersonating IRS agents, Medicare officials, Social Security officers, FBI agents and other government officials.  They may also call and say they are with your local police or Sheriff's department, the fire department or any other government agency you can think of ... and some you may never of heard of!  

These people have no limitations on what they will threaten, if they believe they will be able to get you to either give them personal information (like your Social Security or Medicare number) or get you to pay them for some "fine" which they insist you owe.  Far too many people fall for these scams. 

What are the scams which are currently making the rounds?

Medicare Scams - An official sounding scammer may call you and say they are sending you a new Medicare card, but they need to confirm your Medicare number before sending it out.  Never give out your Medicare number to anyone other than your medical provider, during your first in-person visit to their office.  No one should ever ask you for that number over the phone.  No one from Medicare will ever call to ask you that information.

Grant Fraud - If you are a small business owner or the victim of a natural disaster, you may be eligible to file for a grant to get financial assistance.  However, you will never be asked to send in money as part of any government application process.  If you are eligible to apply for a federal grant, your should make sure you are absolutely certain that you are applying through the website of the actual applicable government agency.  Double-check the URL on the site.  In most cases, it will end with .gov.  If you have any questions, try to call the agency and make sure you are not putting your personal information on a fraudulent site.  

Social Security Scams - There are many ways that scammers try to get people to reveal their Social Security numbers.  However, a fairly recent scam is one where someone calls and tells you that your Social Security number and bank account number have been compromised and you should transfer your money, sometimes in the form of Bitcoin, into a new secure account the official has supposedly set up for you.  Do not do it!  Never transfer your money to a new account because someone has called you.  If someone contacts you and you are uncertain what to do, go in person to your local branch of Social Security or your bank and talk to an employee there.  Never give out information over the phone, even if you feel pressured. Bank and Social Security employees have been trained to help people avoid these types of scams, but they can only help if you tell them what is going on.

Student Loan Tricksters - Some people have been called and told that an agent was processing their student loan forgiveness application.  The agent says he just needs to get their Social Security numbers and bank information to complete the process. Once again, never reveal this information over the phone to anyone.  The real student loan processing companies have web sites where you enter any necessary information.  Again, make sure you are on the legitimate website of your loan processor. If the URL does not look right, call them and make sure you are using the correct one.  Also, compare the URL of the website to the information printed on your original loan documents.  

FBI Scam - Do not believe it if a supposed "FBI agent" calls to tell you that you need to send money to the government, whether it is to cover the fees for winning a sweepstakes, or for any other reason.  The FBI does not make "surprise" calls and ask for money.  In fact, neither does the IRS or other government agencies.  Any time a government agency needs to contact you, they will do so first by U.S. mail.

What You Should Know About the Government Contacting You 

The government will not call and ask for personal information.  They already know it.

Important documents from the U.S. government are sent by U.S. Mail

The government will also not contact you through social media, text messages or email.

The government does not randomly offer to send you grant money.  You have to apply through the appropriate agency for a specific reason.

The government will not ask you to send them money up-front before they will pay you a benefit, a grant, or give you a refund.  

The government does not call and threaten to suspend benefits or bully you into revealing personal information.  As stated before, if there is ever a question about something, they will contact you by U.S. Mail and you can follow up with the appropriate agency. 

The government will NEVER ask you to send them money using prepaid gift cards, wire transfers, or cryptocurrency, such as Bitcoin. 

If you keep the above warnings in mind, you should be able to avoid most of the scams that are going around.  Hang up immediately on anyone who calls and pretends to be from the government, unless you have a reason to expect the phone call ... for example, when you have already contacted a government agency by mail or phone and they are returning your call.  Even when this happens, government representatives will not demand payments over the phone, put pressure on you to make an immediate payment, ask you to reveal personal information, or ask you to make payments using gift cards or Bitcoin. 

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One-Third of Scam Victims are Over Age 65

None of us believe we will ever fall victim to a scam.  We are smart, educated, have common sense and we have decades of real-life experience.  There is no way that someone could fool us.  Right?  Unfortunately, professional scammers are working day and night to come up with new ways to cheat us out of our hard-earned money and, I'm sad to say, many of them have gotten really good at it.

According to the AARP and the National Council on Aging, people over age 65 comprise only about one-eighth of our population; however, they are the victims in approximately one-third of all scam cases.

If we are going to make sure our retirement savings last the rest of our lives, it's not enough to be certain that it is invested well.  We must also be sure that no one can trick us into turning some of it over to a fraudulent business.

Seven Common Scams Against Senior Citizens

Sweepstakes:  Beware of letters, emails and phone calls announcing that you have won a contest or sweepstakes, especially one that you do not remember entering.  If the contest administrators ask for money to pay them money in advance to cover taxes, insurance or other fees, it is almost certainly a fraud, since honest contests are not allowed to do this.  Call your local sheriff's office or county prosecuting attorney's office.

Online Dating:  If you put your profile on a dating site, be cautious if, after weeks or months of pleasant messages, the person you have connected with online begins to express a need for money.  They may say they want the money so they can afford to visit you or because they have a medical or personal emergency.  Frequently they will ask that you send the money in a wire transfer.  American women over the age of 50 are the most common victims of these scams.  They lost a reported $34 million in 2012, while American men lost approximately $5 million.  It is believed that many more cases go unreported because the victims are too embarrassed to tell anyone.  Each incident costs the victim an average of $10,000. 

Phony Charities:  I have repeatedly listed on this blog that people need to thoroughly vet any new charity before they make donations to it.  Never give your credit card information to someone who comes to your door or calls you with a charitable request.  Be skeptical of any charities that you have never heard of.  Check them out with the Better Business Bureau Wise Giving Alliance, CharityNavigator.org, or a similar charity evaluator.  Otherwise, stick to charities that you have dealt with in the past and trust, such as your religious organization, the Red Cross, United Way and similar well-known non-profits.

Grandparents Scam:  Two personal friends of mine have fallen victim to this scam.  Both of them were intelligent women who never thought they would fall for something like this.  Both of them discussed the situation with their husbands before sending money.  One of them is married to a retired Deputy Sheriff and even he was fooled.  In this scam, a upset "grandchild" or other relative calls, desperately begging for money and sobbing at the same time, so it is hard to recognize their voice.  Think you wouldn't be fooled?  People in the United States have reported losing $110 million a year to this scam ... and many more may not have reported it!

Home Repair Scams:  These scams happen most often after a major catastrophe that damages homes in your neighborhood; however, they can happen at other times, as well.  Someone may show up at your door offering to repair your gutters, fix your driveway, replace roof shingles or make other home repairs.  They can cheat you in one of two ways: either they ask for an upfront fee and then disappear; or they make shoddy repairs and keep asking for more and more money to fix new "issues" they find (or create).  Get recommendations for contractors from your friends, neighbors or insurance company before you use anyone.  Make sure they have a contractor's license.  Never hire anyone who unexpectedly shows up at your door.

Healthcare Thieves: This has been going on for a long time, but it is expected to become worse for a while because so many people are confused about the new Affordable Care Act.  A stranger, pretending to be a consultant, may offer to help you get free medical supplies or to help you understand changes to your insurance.  What they are really trying to do, however, is steal your identity, get medical care under your name, and leave you with the bill.  A woman here in Orange County, California, where I live, was arrested a few years ago for stealing another woman's medical identity and using the other person's identity to get several elective surgeries, including cosmetic surgery!

Investment Scams:  Unfortunately, these types of crimes did not end with the arrest of Bernie Madoff.  I have known several people who have fallen for these types of smooth-talking crooks.  One elderly couple we know lost nearly all their savings and were stunned when they discovered that "the nice young man" they trusted had actually stolen from them. This scam may start with a free-lunch seminar or some other special program set up under the guise of helping seniors find "low-risk" investments. People can be wiped out before they realize there is a problem.  Once again, stick with major investment firms or those that you know very well.

If you believe you have been a victim of a thief or scammer, contact your local police department, sheriff's department or the prosecuting attorney's office.  Keep any evidence you have that will help them identify the person behind the scam.

Other scams that often target senior citizens are counterfeit drugs, funeral scams, anti-aging products, and deceitful practices involving financial services such as reverse mortgages.  Always discuss major outlays of money with other family members as well as trusted financial advisers.

Bottom line:  Be careful.  Be skeptical.  Rely on all those years of experience that have kept you safe during your younger days.  You do not want to give away your hard-earned savings to criminals.

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Source: 

http://www.ncoa.org/enhance-economic-security/economic-security-Initiative/savvy-saving-seniors/top-10-scams-targeting.html

AARP Bulletin, Fall, 2013.

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