Statistics continue to show just what a common occurrence financial fraud is today. They also show that no one at all is immune to fraudsters attempts to con them. Very likely you have experienced one of these criminals targeting you, or you have someone close to you that has gone through this agony.
The elderly are very often the targets that fraudsters go after as seniors are known to be far more trusting and also isolated socially. In addition, they very often possess more assets for the cons to target. Very common strategies are employed by the bad guys to take advantage of all targeted marks including the seniors. Marti DeLiema, who at the Stanford Center on Longevity is a post-doctoral fellow has pointed out how “recognition of persuasion tactics will go far in preventing either a loved one or yourself from being victimized”.
On the topic of financial fraud of the elderly, Ms. DeLiea is one of the leading experts in the nation. Take a look now at seven tricks used by scammers on their victims that she clearly describes.
The victims are always being promised something or other by the fraudsters. It might be anything from a magic pill that will help them lose weight without exercise or diet, a free cruise or vacation stay, or a simply great investment opportunity.
Another great scam is their contacting you to report that something awful has happened. It could be anything from the IRS calling to collect money which is owed, to a family member being placed in jail. Action is needed to deal with whatever the problem may be and it has to be handled at once. Their whole goal is to get you completely emotionally aroused and anxious.
These arousals can make many people and particularly older adults to ignore their normally sound judgement. Stanford research recently conducted has showcased how elderly people that find themselves in a high emotional arousal state – either angry or excited – immediately become more interested and anxious in purchasing various items that were advertised falsely.
DeLiema strongly suggests that in the heat of the moment, you should never accept an offer. Prior to paying or laying out any money at all, pause, think things over and talk to family members and trusted friends about it.
You should also be aware that avoiding conversations with fraudsters in the first place is a great way of avoiding emotional arousal. Seniors should definitely employ caller ID and if they do not recognize who it is that is calling, hang the phone up at once. If they do speak to anyone and feel pressured at all about donating, paying or investing any money, they want to be certain to say simply “NO” or “I am just not interested at all”.
Fraudsters love to try and create a sense of urgency in you and get you thinking if you don’t act right away you will miss out on the greatest thing in the world. You will hear things said like “This item is so popular now that if you don’t get it right away, you miss out” and of course, “this deal is not going to last”.
DeLiema strongly suggests that before paying any money, a cooling-off break is taken. Before any final decision is reached, time must be taken. Doing so will prevent buyer’s remorse and this is so critical in making any financial decisions.
When people say things like “let me think it over”, many sales representatives are told to just move on and forget about them. Their time is better spent on other potential marks, they are directed.
Credibility Of The Source
When information is furnished by people or organizations that someone trusts, they are far more likely to take it seriously and believe it. Fraudsters know and understand this so they will very often use some well-known firm, government agency, charity or company to establish, through name recognition, a sense of legitimacy. They gain more persuasive power through brand association.
Conducting proper research is something strongly recommended by DeLiema. Ask for specific credentials and then contact the organization directly to verify the facts. One can often go online to find information on nonprofit organizations and different companies.
A good example of this would be to see if the person soliciting claims to be a financial advisor, check with the state securities regulator or see if they are registered with the Securities and Exchange Commission. Should the caller claim they are representing a bank, instead of providing any personal details over the phone, hang up and contact the bank directly.
Very often it is the social environment that we base our behaviors and opinions on and take cues from. We look to see how others have acted and conducted themselves in similar situations. The sad part is that this will be used against you by the fraudsters. they will tell you how “hundreds of others have taken advantage of this and you don’t want to be the one to miss out, do you”?
Very often the target will think about this and ask themselves, “all these folks can’t be wrong, can they”?
The claim that “everyone else is doing it” should never be trusted, DeLiema recommends. To validate these assertions, it is vital to do the proper research. A vital thing to look for should be testimonials made by true customers and not the masses mentioned by the solicitor.
The Norm Of Reciprocity
The truth of the matter is that someone who has received a small favor from someone else is quite
likely to return a bigger favor down the line. Fraudsters understand this and make every effort to benefit from this “norm of reciprocity” exchange.
DeLiema points out to us that it is immediately after the initial favor is done that the urge to reciprocate is the strongest. She strongly suggests waiting some time to allow the pressure to give something in return to calm down. Think things through to evaluate if this is an actual fair exchange and who is truly getting the better deal.
Older adults are thought by fraudsters not to be able to process too much information at any one time. This will then make them vulnerable to distraction. When paired with emotional arousal, these techniques are very effective.
If the solicitor is being vague about anything or looking to change the subject, something is wrong. True salespeople will give clear, understandable answers to all questions before any signing takes place.
Fraudsters use this technique of posing rhetorical questions to get you to be agreeing with them. They are designed to give a sense of control to you but are truly structured to give the advantage to the fraudster at your expense.
Landscaping winds up backing one into a corner they cannot escape. The following sort of questions are posed by the fraudster:
“You would love to be a millionaire, wouldn’t you”?
“Don’t you want to get your grandson out of jail”?
“For your children and grandchildren, don’t you want to leave a legacy”?
All of these questions are designed to gain a “yes” answer!
DeLiema asks you to consider why such obvious questions would be posed and recommends people practice saying “no”.
If you can recognize these seven tactics which are not unique to financial fraud, you can do a great job protecting your money from financial predators, criminal or legal.