Healthcare News

Protecting Seniors From Fraud

April 10, 2018 Herb 0Comment

 

This month, two released reports paint a picture of consumer fraud and its Two reports released this month paint a troubling picture of scammers taking money from their victims.

On March 1, 2018, the Federal Trade Commission (FTC) put consumer fraud on the nation’s radar screen by releasing it’s 2017 Consumer Sentinel Network Data Book of complaints received by consumers.  FTC’s data book includes complaints from 2.68 million consumers, a decrease from 2016 when 2.98 million consumers submitted reports about fraud, Despite this, consumers reported losing a total of $905 million to fraud in 2017 — $63 million more than in 2016.

The federal independent agency produces the data book annually using reports received by the Consumer Sentinel Network. These include reports made directly by consumers to the FTC, as well as reports received by state and federal law enforcement agencies, national consumer protection organizations, and non-governmental organizations.

The Numbers Are In…

This year the FTC has developed a mini site available at ftc.gov/sentinel2017 to make the information in the 2017 data book more accessible for the public, such as providing a webpage for each state.

FTC’s data book includes national statistics, as well as a state-by-state listing of top report categories in each state, and a listing of metropolitan areas that generated the most complaints per capita. The top states in 2017 reporting fraud were Florida, Georgia and Nevada, while Michigan, Florida and California had the most reports about identity theft, per capita.

Although FTC reports about debt collection declined between 2016 and 2017, it remained the top consumer complaint category, making up about 23 percent of all complaints. The high number of debt collection reports was due in part to reports submitted by a data contributor who collects complaints via a mobile app.

Identity theft was the second biggest category, making up nearly 14 percent of all the consumer complaints. Credit card fraud was the most common type of identity theft reported by consumers. Tax fraud was the second most common type of identity theft reported by consumers despite falling by 46 percent from 2016.

“While we received fewer overall complaints in 2017, consumers reported losing more money to fraud than they did the year before, “said Tom Pahl, Acting Director of the FTC’s Bureau of Consumer Protection in a statement. “This underscores the importance of the FTC’s work in educating consumers and cracking down on the scammers who try to take their money.”

For the first time, the 2017 data book includes details on fraud losses broken out by specific age groups, complied by the reported complaints.  Young consumers, ages 20 to 29, reported losing money to fraud more often than those over age 70.  Forty percent of these individuals indicated they lost money. In comparison, only 18 percent of those age 70 and older who reported fraud say they lost money. However, when these older adults did report losing money in a scam, the median amount lost was greater. The median reported loss for people age 80 and older was $1,092 compared to $400 for those ages 20 to 29.

Finally, imposter scams were the third most common consumer complaint. Consumers reported losing substantially more money to this type of scam – a total of $328 million – than any other type of fraud. Imposter scams involve someone pretending to be a government official, tech support representative, a loved one in trouble or someone else in order to get consumers to give the scammer money. Nearly one in five consumers who reported an imposter scam indicated they lost money to the fraud.

Senate Aging Panel Zeros in on Consumer Fraud

Following on the heels of the FTC’s released annual report of consumer complaints, the U.S. Senate Special Committee on Aging puts the spotlight on common fraud schemes directed at America’s seniors at panel hearing, “Stopping Senior Scams, scheduled on March 7, 2017, the Committee’s Fraud Hotline received more than 1,400 complaints of frauds targeting seniors around the country, clearly revealing the extent of this epidemic.

Last year, the most prevalent scam reported to the Committee’s Hotline, detailed in the Senate Aging Committee’s 56-page 2018 Fraud Book, was the IRS Impersonation Scam in which con artists call, pretending to be IRS representatives, to collect payment of taxes and threaten arrest if payment is not immediately made by phone (During tax filing season, seniors and others should be on high alert for scam artists claiming to be the IRS).

This hearing was the third hearing this Congress—and the 12th in the past three years—that the Senate Aging Committee has held examining scams affecting older Americans. These hearings examined notoriously widespread scams including the IRS imposter scams, lottery and sweepstakes scams, computer tech support scams, grandparent scams, elder financial exploitation, and identity theft.

For a copy of the 2018 Senate Aging Committee Fraud Book, go to www.aging.senate.gov/imo/media/doc/Fraud%20Book%202018%20FINAL.pdf.

 

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