By Craig L. Greene, CPA/CFF, CFE, MCJ

Shopping by telephone is very convenient, and there are many legitimate companies that do business through telemarketing. Unfortunately, the telephone is also used by crooks every day to commit armed robbery against consumers. It’s estimated that there are 14,000 illegal telemarketing operations bilking U.S. citizens of at least $40 billion annually. And surveys by the American Association of Retired Persons reveal that over half of telemarketing fraud victims are age 50 or older. The key message today is that fraudulent telemarketers are criminals.

All consumers, and seniors in particular, need to understand that these aren’t just sleazy sales people trying to make a living - - fraudulent telemarketers are hardened criminals out to take their victims’ life savings. They’re so good at what they do, they can even persuade people to mortgage their homes in order to claim their sweepstakes winnings or make investments. But all too often there aren’t really any sweepstakes, investments or other great deals, just lies.

Studies by the American Association of Retired Persons show that most elderly fraud victims don’t make the connection between illegal telemarketing and criminal activity. They don’t associate the voice on the phone with someone who could be trying to steal their money.

Most believe that the caller is a nice young man or woman simply trying to make a living, such as a student working his or her way through college, or an ambitious person trying to set a good sales record at the company. Victims think a fraudulent telemarketer’s actions are not crimes, simply hard sells. They may realize that they haven’t gotten their money’s worth, but they are reluctant to admit that they have been cheated or robbed by illegal telemarketers.

The First Step in helping older people who may be targets of fraud is to convince them that the person on the other end of the line could be a crook!

Once they understand that illegal telemarketing is a serious crime — punishable by heavy fines and long prison sentences — they are more likely to hang up and report calls to the authorities.

Older people may be surprised to know that there are an estimated 14,000 illegal telemarketing operations bilking thousands of victims every day. They rob with phones instead of guns. And they don’t care about the pain they cause when they steal an elderly person’s life savings. If they are caught, they can be put in jail — where they belong.

Older people are frequent targets of fraudulent telemarketers. They need help because:

IT IS HARD TO TELL IF A CALLER IS LEGITIMATE. Good sales people are convincing and so are crooks.

IT IS HARD TO HANG UP. Many people feel that it’s impolite to hang up on callers. And swindlers know how to take control of the conversation, either by pretending to be very friendly or by using bullying tactics.

SENIOR CITIZENS ARE TARGETED RELENTLESSLY. Some older people get more than 20 calls a day from scam artists - - the same ones trying to wear them down, or ones who know they’ve been victimized before and think they’re vulnerable.

SENIORS TEND TO TRUST THE CALLER. Targets of fraud often don’t realize that the person on the phone could be a crook. They give people the benefit of the doubt.

WE ALL WANT TO BELIEVE. Who doesn’t want to win a valuable prize or strike it rich on an investment? People want to believe that it’s their lucky day, and may react with anger or suspicion when friends or family question their optimism.

It’s hard to hang up on people - - especially when the caller sounds so polite and friendly. But people wouldn’t let strangers into their homes or accept rides from someone they didn’t know. So, they should handle telephone calls from strangers the same way.

Elderly Targets of Fraud Need to Know That:

Illegal telemarketing is a crime, and that fraudulent telemarketers are criminals

The FBI reports that there are an estimated 14,000 illegal telemarketing operations bilking consumers every day

• As much as $40 billion per year is lost to fraudulent telemarketers
  
• You can’t tell by the tone of someone’s voice if the caller is legitimate
  
• Legitimate companies don’t pressure people into sending money immediately
  
• It’s illegal for contests or sweepstakes to require payment to enter or claim a prize
  
• Legitimate marketers are willing to send written information
  about the products or services they’re selling
  
• Giving money to a fraudulent telemarketer usually means losing it forever;
  reporting suspected telemarketing crime is essential to stop it
  

AND THEY NEED TO KNOW they can protect themselves from being targets of fraud by:

Telling the caller that they want to check it out and asking for a number to call back. If the caller refuses to give the number or insists on an immediate decision, it’s "red flag of fraud".

How can you tell if an older relative, friend, or client may be a target for telemarketing fraud?
Some warning signs include:

• The person receives lots of junk mail for contests, "free trips", prizes and sweepstakes
  
• The person gets frequent calls from people offering valuable awards, great money-making opportunities, or charitable donations
  
• The person has lots of cheap items such as costume jewelry, watches, pens and pencils, small appliances, beauty products, water filters, or other products that he or she either purchased in order to "win" something or received as so-called "valuable prizes"
  
• The person has made numerous checks or withdrawals for escalating amounts of money to unfamiliar, out-of-state companies
  
• The person begins to act very secretively about phone calls
  
• The person is having payments picked up by private courier services or wiring money to companies
  
• The person is having sudden problems paying bills, or buying food or other necessities
  

DON’T:

Blame the person for being stupid, greedy or foolish. Telemarketing swindlers are good at what they do and take advantage of people’s honesty, politeness and optimism;

Threaten to take away the person’s financial or physical independence. This may only make the person secretive and resentful.

DO:

Help the person assemble the information to report the fraud to the
state or local consumer protection agency or to the NFIC;

Emphasize the criminal nature of telemarketing fraud and help the
person learn how to identify it;

Encourage the person to hang up on telephone solicitations that seem suspicious.

Helping Seniors Targeted by Fraud

Have a calm discussion and try to come to an agreement about the best way to handle the person’s finances in the future. If he or she seems to be truly incompetent, seek legal advice; help the person change his or her phone number, if necessary.