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Provided by the Oklahoma Securities Commission and the University of Oklahoma OUtreach
Though their schemes know no boundaries of race, education level or income status, scammers prey upon
senior citizens because they are more trusting, find it hard to say “no” and are more likely to have “nest eggs” from decades
of saving.
A recent national study found that 80 percent of the elderly approached with a fraudulent investment
fell for the con, compared to just 20 percent of other age groups.
One such fraud is the advance fee scheme, in which seniors are lured by the promise of lottery
winnings, unclaimed money or an exclusive investment opportunity. All they have to do to “get in” is pay a fee in advance.
But the victims get nothing in return, as the high-value prize doesn’t exist.
The charity gift annuity scam is another. Legitimate annuities are an investment tool that work
like a loan, in which a person gives an insurance company money to invest that they pay back with interest. With a charitable
annuity, funds are given to a charity to invest. But unless it’s a well-known organization, the charity may not exist.
Seniors also are pressured into fraudulent investments by con artists promising a “guaranteed” or
“high-return” investment opportunity. Scammers often succeed by demanding an answer right away, giving the victim no time to
think about it, and thus, no time to investigate and discover their illegitimacy.
To avoid becoming victims of financial frauds, the senior population is urged to follow these tips:
Don’t be afraid to say “no” or appear impolite. If someone doesn’t want to give you time to think about an investment, do not invest. Don’t automatically trust someone because they “appear nice.” Verify their legitimacy by calling the Department of Securities. Be wary of salespeople using fear as a pitch. Even if you have no experience handling money, don’t give up that control. Seek help from reputable firms, not total strangers.
Lastly, if you are a victim, report it. Embarrassment is natural, but letting authorities know is the only way they can help stop such abuse.
For more information, listen for the Investment Minute on your
local radio station or visit the Invest Ed web site at www.investedok.org.
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