Elder abuse: a financial red flag for banks and families

In 2023, financial advisors and families of victims targeted by cybercriminals were plagued by reports of elder fraud. Elder abuse fraud is becoming more widespread and insidious, and its consequences often go far beyond simple financial losses. In April, an 81-year-old Ohio man fatally shot a 61-year-old Uber driver after the two were defrauded in a ransom scam, according to the Associated Press.

The challenge for law enforcement, families of elderly victims and the financial industry as a whole is that fraud victims are often reluctant to seek help and, in some cases, will not even admit that they are or have been victims. Cybercriminals are exploiting generational differences by exploiting the unique vulnerabilities of older consumers – consumers who are more likely to take someone at their word (the proverbial “handshake”) rather than feel comfortable questioning someone’s authenticity or asking for additional identity verification.

Older consumers are less likely to hang up on a spam caller or ignore a desperate email or text message, putting them at greater risk of future exploitation.

Romance scams

Romance scams that rely on so-called “pig busting” techniques are often long-lasting and extremely damaging from an emotional and financial point of view(AND). Romance scams typically involve a cybercriminal who adopts a fake persona online to gain the victim’s sympathy and trust. From this point on, the cybercriminal establishes contact with the victim over time, building a relationship aimed at manipulating the victim into sending money, providing access to financial accounts, or consciously or unconsciously laundering funds intended for cybercrime purposes.

“The scammer’s intention is to establish contact as quickly as possible, become attached to the victim and gain trust,” notes the Federal Bureau of Investigation. Scammers may propose marriage and plan personal meetings, but it will never happen. Eventually they will ask for money.”

Technical support and investment fraud

In December, the FBI’s Cyber ​​Crime Complaint Center reported that fraud and cybercrime complaints adversely affecting U.S. adults over the age of 60 increased 11% in 2023 compared to the previous year. The most harmful types of crime affecting the over-60 age group include tech support and investment fraud.

These findings align with data from Javelin Strategy & Research, which shows that almost half (48%) of wealth management advisors surveyed by Javelin had clients over the age of 60 who were victims of technical support, telemarketing and lottery scams.(ii) Furthermore, Javelin finds that technology and romance scams are more likely to fall victim to men, indicating significant risk to a very concentrated and vulnerable segment of the population(iii).

Education and awareness

Fraud education was insufficient because it was not targeted at the demographic groups most at risk. While fraud education has increased dramatically over the past year, most education campaigns are generalized, not only in message but also in approach.

Instead of focusing on education, Javelin finds that most fraud awareness campaigns are disguised and tend to be overwhelming for consumers. For example, older consumers should be targeted with educational campaigns that emphasize that they should remain skeptical of anyone who approaches them with a sense of urgency and not let them hang up (as one example) on a caller who seems suspicious.

Additionally, financial advisors, who are often among the first notified of suspicious activity, tell Javelin they feel ill-prepared and ill-informed about what they can and should do to help victims and their families.

As global attention on elder financial exploitation increases, Javelin strives to educate its financial services clients on how they can and should prevent elder fraud and cybercrime. June 15 is the United Nations’ World Elder Abuse Awareness Day, underscoring why fraud and cybercrime targeting older consumers must receive wider attention.

Related research of interest:

Property accounts at higher risk of fraud and cyber takeovers

Customer Contact Centers: Heroes in the fight against cybercrime, Fraud prevention

Pig butchering fraud: How banks can stop the slaughter

We debunk gender stereotypes in fraud awareness and education

Cybertrust in Banking Scorecard 2022

Solving Identity Fraud: A Field Guide (sponsored by AARP)

(AND) Javelins Strategy and Research, “Pig Robbery Fraud: How Banks Can Stop the Slaughter,” published March 27, 2024; accessed: June 12, 2024

(ii) Javelin Strategy and Research, “Wealthy Accounts at Rising Risk of Cyber ​​Fraud and Takeovers,” published June 20, 2024; accessed: June 12, 2024

(iii) Javelin Strategy and Research, “Disrupting Gender Stereotypes in Fraud Awareness and Education,” published December 12, 2023; accessed: June 12, 2024