I’m a Financial Planner: 4 Top Money Scams I See Boomers Fall For
Written by
Jake Safane
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Molly Sullivan
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While many people are aware of the potential for money scams and overall rise in cyberattacks, fraudsters have continued to evolve and trick people into giving over their hard-earned money. Money scams can hit baby boomers particularly hard, such as those who may be less experienced and comfortable navigating online environments, thus making them susceptible to attacks.
In fact, in 2023, the FBI’s Internet Crime Complaint Center received a 14% annual increase in complaints and an 11% increase in reported losses by those over 60.
Now, as technology like artificial intelligence improves and the world shifts even more toward digital environments for areas like banking and investing, boomers need to keep their guards up for these types of scams, according to financial planners Ed Mahaffy of ClientFirst Wealth Management and Patrick Marcinko of Bogart Wealth. Here’s what they said about these common scams and how to avoid them.
Government Impersonation Scams
One way that boomers could lose money is through government impersonation scams, where fraudsters pretend to be from a government agency like the IRS in order to try to collect payment or steal information. And if you’re at a point in your life where you’re handling taxes more on your own, such as if you’re retired and don’t have taxes withheld from your paycheck, then you might be prone to these scams.
“Given many boomers are near or in retirement, they can be vulnerable to IRS phone scams. It is important to remember the IRS will not initiate contact via phone or text,” Marcinko said.
Government impersonation scams are quickly becoming more common, such as with Mahaffy pointing to FBI data showing they increased by 32% last year. One way to protect yourself could be to avoid giving out payment information over the phone to someone who contacts you unsolicited.
“Beware anyone asking for a fee in advance,” Mahaffy said.
Voice Impersonation Scams
In addition to scams where fraudsters impersonate government officials, voice impersonation scams where fraudsters pretend to be people you know can also pose a big risk. And this type of scam is only getting more prevalent as technology advances.
“With the rise of artificial intelligence, there has been an increase in voice impersonation scams. The scammers will impersonate the voice of one’s children asking for money, and it can be hard for people to recognize the scam. If this happens, hang up, and call your child to confirm the legitimacy of the initial call,” Marcinko said.
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Phantom Hacker Scams
Another way fraudsters impersonate people to steal money, especially from older Americans, is by posing as someone like a tech support worker who acts like you’ve been hacked and pretends to help you remedy the situation, only to then steal from you.
These types of scams are known as Phantom Hacker scams, as Mahaffy noted, pointing to an FBI report on how these scams are significantly affecting seniors.
The scam works by someone getting a phone call, text, email or computer pop-up window that says they need to call a number for support. From there, the scammer tells the victim to download software that — unbeknownst to the victim — provides access to their computer.
Later, the fraudster pretends to be someone like a bank representative and gets the victim to move funds into a supposedly safe account, like one at the Federal Reserve, due to the alleged hack. But really, you could be transferring funds directly to the fraudster.
“Unlike more common phishing expeditions by amateurs who misspell words as well as other tells that smack of an attempt to defraud, these efforts are obviously more sophisticated,” Mahaffy said.
Email Phishing Scams
Lastly, email phishing scams are a common way to get account passwords and infiltrate computers.
“Phishing efforts designed to obtain the information to successfully scam boomers exploded during COVID-19 as more people shopped online,” Mahaffy said.
A simple yet effective phishing scam might pretend to be a password reset email from a store you shop at, only to then have you give up a password to the hacker who then tries that password on different accounts of yours, where they might be able to access your money.
“Maintaining different and strong passwords is critical to protecting your online accounts. Try to not use the same password for multiple websites, especially banking logins,” Marcinko said. “When available, add multifactor authentication to your logins as an extra layer of security for your accounts.”
Phishing scams can also involve things like fake invoices or receipts sent as attachments, and when you open them, you end up downloading malware that enables hackers to then steal more personal information that can help them steal money from you.
“If you receive a suspicious email and they ask you to click on a link, do not reply or open any attachments,” he added.
Protecting Yourself From Money Scams
Ultimately, if you want to reduce the odds of falling for a scam, it’s important to keep your guard up and know common tactics like these.
In general, be wary of unknowns. For example, don’t click on unsolicited pop-ups or links or respond to unknown phone numbers or someone asking you to download software, Mahaffy said.
Also, don’t let an unknown person take control of your computer, and don’t respond to wire requests, he added.
“In short, don’t talk to strangers,” Mahaffy said.
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