Financial fraud is, unfortunately, a common practice in America that costs individuals and businesses billions of dollars each year. Research shows that people often underreport financial fraud, which is difficult to investigate and prosecute.1 As a result, staying aware of different scamming techniques is an important way to protect yourself and your family. Here are a couple of common financial scams that are specifically used to target seniors.
1. Funeral and Cemetery Fraud
For many retirees, paying ahead on your funeral and cemetery expenses can help ease the burden for your family during a time of grief. Unfortunately, these prepaid contracts can come with undesirable outcomes: Deceptive operators overcharge you for services and list themselves as your financial beneficiaries.2 Although regulatory standards are in place to protect people during these transactions, the laws vary by state, which leave openings for people to defraud unsuspecting customers.3
When entering into these arrangements, ensure that you scrutinize your contract details and compare costs between providers so you understand the market. Since different states require you to buy different goods and services, ensure you know which laws apply where you or your loved one intend to hold your funeral and burial.4
2. Grandparent Financial Scams
Another common way that people can try to defraud you is by calling you and claiming to be a relative in need of money. When doing so, con artists pretend to be family members such as grandchildren or a representative of relatives. They typically call late at night and claim they need you to wire them money immediately to help them out of trouble.5 They could claim the money is for bail, hospital fees, or other urgent financial needs. To keep up the ruse and avoid suspicion, they will also request that you don’t tell other relatives, like their parents, who would disapprove.6 By doing this, they create emotional bonds that you are the only person they can trust and who can help.
If you receive a call from someone claiming to be your relative and asking you to wire money, do not do anything. First, contact your relative’s other family members to validate the person’s story. If you cannot verify the story, you may be a victim of a financial scam.
You can report Grandparent Fraud to:
• The local police department
• Your state’s attorney general’s office
• Fraud.org, a project of the National Consumers League
These financial scams are just a snapshot of the various ways criminals can try to take advantage of you and your money, and seniors are especially vulnerable. We encourage you to continue educating yourself and your family about fraud and stay aware. If you would like to discuss any financial concerns you may have or simply revisit your personal financial details with us, please give our office a call today at 303-741-9772.
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Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Dechtman Wealth Management, LLC [“DWM”]), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from DWM. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. DWM is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the DWM’s current written disclosure Brochure discussing our advisory services and fees is available for review upon request or at www.dechtmanwealth.com.
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