Weekly Column: “Hanging Up On Phone Scams”
Last October, a grandfather in Bath received a phone call from a young man claiming to be his grandson. The caller sounded distressed and told a story that justifiably caused concern. The “grandson” was traveling in Nicaragua, was involved in a car accident, and urgently needed $1,800 to pay for damages to his rental car. The caller instructed the grandfather to send the money through Western Union.
Although the grandfather was a bit suspicious about this call, he believed that his grandson may, in fact, have been traveling to Nicaragua for a wedding, and that the caller’s story could be plausible. He therefore withdrew the requested funds from Bath Savings Bank and wired them to the caller, just as he was asked to do.
That is not the end of the story. The grandfather received a second call from the same individual claiming to be his grandson, this time explaining that someone had been injured in this supposed car accident, and that the Nicaraguan government was pursuing criminal charges. The “grandson” would need an additional $4,000 to retain an attorney. The caller even turned the phone over to someone claiming to be his attorney who emphasized the urgency of the situation.
When the grandfather returned to Bath Savings Bank to withdraw more funds, the bank teller warned him that the situation sounded suspicious and advised him to ask more questions before sending the money to Nicaragua.
When the grandfather spoke with the caller again, he asked questions that his grandson would have been able to answer, such as “where were you born?” and “who is your mother?” When the caller could not answer the questions, this grandfather realized that he had been scammed. Fortunately, he had not yet released the additional $4,000, but he had been scammed out of $1,800-- money that could not be recovered.
This scam, often known as the “grandparent scam” or “person in need scam” is not new, nor it is subsiding, unfortunately.
According to the Federal Trade Commission (FTC), Americans lost more than $73 million to impostor scams last year. Sadly, the agency admits the figure accounts for only a fraction of the problem because most victims fail to report the crime. Instances of imposter scams have doubled between 2009 and 2013.
Helping to educate seniors about these scams so they can avoid becoming victims, ensuring that the government is doing its part to prevent scams, and putting a stop to these unscrupulous con artists are priorities for the Senate Special Committee on Aging, where I serve as Ranking Member. We recently held a hearing on these scams as part of this ongoing effort. This was the Committee’s seventh hearing on scams targeting seniors.
In fact, a great deal of what we have learned about these scams is a result of reports and complaints made to our Committee’s fraud hotline.
As we have learned, these scammers are not only unscrupulous and aggressive-- often calling potential victims dozens of times-- but they are also technologically savvy. They know how to route their calls using “Voice over Internet Protocol,” which is very hard to trace. And they know how to “spoof” caller ID to make it appear they are calling from a trusted source.
During our recent hearing, we heard testimony from a victim of a scam, as well as government officials from the FTC and the Federal Bureau of Investigations (FBI) who discussed what their agencies are doing to address the proliferation of phone scams targeting seniors. The FTC logged in and reported 127,000 imposter scams last year. By way of contrast, the FBI official reported that the agency investigated fewer than 90 such cases last year. It is troubling to me that the cases the FBI investigated are less than one-tenth of one percent of those reported to the FTC. The FBI and other government agencies should investigate and prosecute more cases. I will follow up our hearing with questions directed to the FBI about why the agency’s efforts to address this egregious problem are not more aggressive since the con artists now believe that there is no penalty to be paid for their illegal behavior, and they are usually correct!
While government should be doing more, there are also steps that seniors can take to avoid being victimized by this type of scam. If someone claiming to be a friend or relative asks for money, ask them a question to which only they would know the answer. And do not be afraid to call a family member you know well to confirm a story. Most important, do not send money unless you are absolutely certain the story is true.
There must be aggressive efforts on many fronts to hang up on these unscrupulous phone scams.
If you suspect that you or someone you know has been the victim of a scam or fraud, call the U.S. Senate Special Committee on Aging toll-free hotline for help. The number is 1-855-303-9470.
Although the grandfather was a bit suspicious about this call, he believed that his grandson may, in fact, have been traveling to Nicaragua for a wedding, and that the caller’s story could be plausible. He therefore withdrew the requested funds from Bath Savings Bank and wired them to the caller, just as he was asked to do.
That is not the end of the story. The grandfather received a second call from the same individual claiming to be his grandson, this time explaining that someone had been injured in this supposed car accident, and that the Nicaraguan government was pursuing criminal charges. The “grandson” would need an additional $4,000 to retain an attorney. The caller even turned the phone over to someone claiming to be his attorney who emphasized the urgency of the situation.
When the grandfather returned to Bath Savings Bank to withdraw more funds, the bank teller warned him that the situation sounded suspicious and advised him to ask more questions before sending the money to Nicaragua.
When the grandfather spoke with the caller again, he asked questions that his grandson would have been able to answer, such as “where were you born?” and “who is your mother?” When the caller could not answer the questions, this grandfather realized that he had been scammed. Fortunately, he had not yet released the additional $4,000, but he had been scammed out of $1,800-- money that could not be recovered.
This scam, often known as the “grandparent scam” or “person in need scam” is not new, nor it is subsiding, unfortunately.
According to the Federal Trade Commission (FTC), Americans lost more than $73 million to impostor scams last year. Sadly, the agency admits the figure accounts for only a fraction of the problem because most victims fail to report the crime. Instances of imposter scams have doubled between 2009 and 2013.
Helping to educate seniors about these scams so they can avoid becoming victims, ensuring that the government is doing its part to prevent scams, and putting a stop to these unscrupulous con artists are priorities for the Senate Special Committee on Aging, where I serve as Ranking Member. We recently held a hearing on these scams as part of this ongoing effort. This was the Committee’s seventh hearing on scams targeting seniors.
In fact, a great deal of what we have learned about these scams is a result of reports and complaints made to our Committee’s fraud hotline.
As we have learned, these scammers are not only unscrupulous and aggressive-- often calling potential victims dozens of times-- but they are also technologically savvy. They know how to route their calls using “Voice over Internet Protocol,” which is very hard to trace. And they know how to “spoof” caller ID to make it appear they are calling from a trusted source.
During our recent hearing, we heard testimony from a victim of a scam, as well as government officials from the FTC and the Federal Bureau of Investigations (FBI) who discussed what their agencies are doing to address the proliferation of phone scams targeting seniors. The FTC logged in and reported 127,000 imposter scams last year. By way of contrast, the FBI official reported that the agency investigated fewer than 90 such cases last year. It is troubling to me that the cases the FBI investigated are less than one-tenth of one percent of those reported to the FTC. The FBI and other government agencies should investigate and prosecute more cases. I will follow up our hearing with questions directed to the FBI about why the agency’s efforts to address this egregious problem are not more aggressive since the con artists now believe that there is no penalty to be paid for their illegal behavior, and they are usually correct!
While government should be doing more, there are also steps that seniors can take to avoid being victimized by this type of scam. If someone claiming to be a friend or relative asks for money, ask them a question to which only they would know the answer. And do not be afraid to call a family member you know well to confirm a story. Most important, do not send money unless you are absolutely certain the story is true.
There must be aggressive efforts on many fronts to hang up on these unscrupulous phone scams.
If you suspect that you or someone you know has been the victim of a scam or fraud, call the U.S. Senate Special Committee on Aging toll-free hotline for help. The number is 1-855-303-9470.
