The COVID-19 pandemic gave scammers an opportunity to use new tactics to defraud older adults, including illegal robocalls, texts and emails, and social media posts.
In 2020, the Federal Trade Commission estimated that older adults lost at least $602 million to fraud, scams and financial exploitation schemes, and that seniors lost $100 million to COVID-19-related fraud, according to the 2021 Fraud Book from the Senate Special Committee on Aging.
Committee Chairman Sen. Bob Casey (D-PA) announced the release of the 2021 Fraud Book on Thursday during a hearing on fraud, scams and COVID-19.
“In the early days of the pandemic, many seniors isolated themselves to avoid contracting the virus, but in the process were cut off from family and friends,” Casey said. “Fraudsters saw an opportunity and they pounced.
“Eighteen months into the pandemic, federal agencies, state governments and advocates warn of con artists who will pedal fake cures for coronavirus, charge outrageous prices for personal protective equipment, and seek to steal stimulus checks and unemployment benefits. These scenarios are not hypothetical.”
Some of the most common COVID-19 scams involve contact tracing, virus and antibody test kits, vaccines and miracle cures. The loneliness and isolation necessitated by the coronavirus also led to a sharp increase in online romance fraud — complaints rose from 8,500 in 2015 to 25,000 in 2019.
The report also laid out the top five scams reported to the committee’s fraud hotline from Jan. 1, 2015, through Dec. 31, 2020. The hotline received 8,402 complaints in that time, mostly tied to government impersonation scams (3,383 complaints), sweepstakes scams (639), illegal robocalls / unsolicited phone calls (636), computer scams (445) and grandparent scams (368).
Other calls to the fraud hotline involved IRS impersonation scams (3,015), Society Security scams (368), romance scams (314) and elder abuse (268).
Maine had the highest number of fraud hotline calls with 2,495, followed by Pennsylvania (595), Texas (536), California (519) and Maryland (467).
During the hearing, Casey said that FTC data show the importance of education in stopping frauds and scams before they start, which prompted him to reintroduce the bipartisan Stop Senior Scams Act. Senate Bill 337 would create an advisory committee to educate industry employees on how to identify and prevent scams targeting seniors. Supporters of the bill include the AARP, the National Association of Long-Term Ombudsman, the National Council on Aging, and various business and industry representatives.
Odette Williamson, a staff attorney with the National Consumer Law Center in Boston, testified that “the impact of financial fraud and scams on older adults is devastating.” She said that, depending on the amount of money lost, older adults can fall into poverty or homelessness.
Money and assets are difficult to recover, Williamson said, adding that even if money or assets are recovered, it is unlikely to make the older adult financially whole. Older adults need the support of legal services and social support organizations to navigate a post-scam financial reality, she said.
“Older consumers need the highest level of protection from fraud and scams,” Williamson said. “Government, businesses and advocates must protect older adults from these devastating scams, and robustly prosecute those who have victimized consumers.”
Vee Daniel, president and CEO of the Better Business Bureau serving upstate South Carolina, testified that during the pandemic, she saw new scams involving masks, non-Food and Drug Administration-approved medical supplies, immunity boosting products and equipment through online purchase scams relating to COVID-19. She also saw fake websites, phishing emails involving stimulus checks, price gouging, scammers impersonating government agencies and fake vaccines also were seen, she added.
Since 2016, the BBB has seen a clear pattern, Daniel said.
“Although seniors are pretty savvy and tend to fall for scams less frequently than younger demographic groups, they lose more money,” she said. “This is partly because the type of scams that target seniors — romance scams, investment scams and family emergency scams — tend to be higher dollar amounts.
“Although many seniors have gotten the message and are more cautious than in the past, too many are still falling victim to unscrupulous criminals.”