Fraud Prevention

Elderly Targets For Financial Exploitation

April 4, 2017 By Twila Van Leer

Make sure you are aware of basic ways to protect yourself from fraud.

Older Americans are prime targets for financial exploitation, both by people they know and strangers. Financial experts label it “the crime of the 21st Century.” In 2010, the losses amounted to at least $2.9 billion.

With more than 57 million people over age 60 in the country (2010 census) it is a growing problem.

Mild cognitive impairment associated with aging is a factor that allows the elderly to be victimized. They may lack the ability to make sound financial decisions without help.

Though it is well recognized, the problem of financial abuse of the elderly remains “under the radar,” experts say, because cases are complex and are hard to investigate and prosecute. The situation is even more serious for old people because they are limited in their ability to recoup losses. The result may be loss of ability to live independently, decline in health, broken trust and family dissolution.

The best solution is prevention. Being aware of an elderly person’s finances and protecting them against theft is paramount. Planning ahead and managing money according to needs is essential. In the case that something appears to be amiss, early reporting helps facilitate recovery.

Some trusted individual should be granted executor of their finances to enable him or her to act in financial matters for an elderly person if he or she becomes too disabled to handle their own money.

Additional information is available through the Consumer Finance Protection Bureau or by visiting Consumer Finance.

Beware Of Holiday Fraud

December 21, 2016 By Twila Van Leer

Find out how you can become more aware of protecting yourself against fraud.

The happiest time of the year also is the most opportune for those who wreak fraud on the rest of us. With people spending more, traveling more and donating more to charities, they are looking for ways to dip into your holiday spending money, warns the Better Business Bureau.

The bureau advises extra caution. Don’t get so caught up in the season’s frenzy that you make yourself vulnerable to the predators. Here are some tips from the experts to help you negotiate the holidays without being victimized:

Online Shopping Issues

Online shopping has become popular because of the convenience, but it also can be the route to fraud if you aren’t careful. The U.S. Computer Emergency Readiness Team, an arm of the Department of Homeland Security, warns of the most common ways in which criminals can steal your vital information or relieve you of your cash through fraudulent means. They create phony sites and email messages, intercept insecure transactions and target vulnerable computers.

Verify Good Deals

You can best foil them by using the good sense you apply to shopping year-round. Deal with vendors you are sure you can trust. Don’t be misled into error in your search for a good deal. Be careful of sites that mimic the reputable dealers by offering a brand that is slightly off. Avoid clicking on emails and links from unfamiliar senders. If you find deals that are too fantastic to be real, they probably are not. The most frequent complaints to the National Consumers League involve such come-ons that prove to be dishonest. Popular items such as electronics and clothing tend to be the most frequently offered in fraudulent online “deals.”

Charity Donations

The holidays bring out the generosity in many people. Charities tend to use that fact to reline their coffers. Give, but back your generosity with some solid research. The Federal Trade Commission suggests looking at the BBB’s Wise Giving Alliance, Charity Navigator, Charity Watch and/or GuideStar before making your donation. Avoid any purported charity that won’t share pertinent information about its identity, mission and costs. Also beware of those that use a name that closely resembles a well-known charity in an attempt to misguide you. Never send cash or wire money. Pay be check made out to the charity or by credit card.

Travel Deals

Travel is an important item on the Christmas lists of many people. Keep the memories pleasant by avoiding hokey come-ons online offering hotel booking sites at a bargain. Stick with those whose reputations are firmly established. Use a good broker or make reservations yourself. Use only licensed taxi or ride services. Protect the details about sky miles and loyalty points as you would any other personal information. Using “free” Wi-Fi spots in the airport may make you vulnerable to exposure of the personal information on your phone, computer or other device.

Email Warnings

Some scammers even use Santa’s good name to do their damage. Be sure that the charming and personalized message you get from the North Pole is legitimate. Take the same precautions with electronic greeting cards. Gift exchanges online are just another variation on the old pyramid schemes and are illegal.

Keep your Christmas merry by thwarting the fraudsters who would make hash of your holidays.

Medicare Fraud Over $60 Billion

June 29, 2016 By Twila Van Leer

Medicare fraud caused over $60 billion in fraud every year. — Medicare loses over $60 billion in fraud every year.

Medicare Fraud Extensive

Medicare fraud is a huge problem. Thousands of older Americans depend on Medicare to help them meet medical expenses, but fraudsters are taking a big scoop from the federal funds before they get to legitimate health care providers, a recent article in the AARP Bulletin says.

Medicare Fraud Causes Multi-billion Dollar Losses

Medicare fraud is estimated to cause more than $60 billion per year. In one very infamous case, a Texas thief methodically siphoned some $375 million from the fund over a five-year period, using a variety of methods. That man now faces life in prison, but the heavy toll taken by unscrupulous people continues to scrape billions from the heath care program.

Fraud Tactics

Fraud and abuse involves such tactics as phantom outpatients, “ghost” clinics, undelivered services, over-billing and identity theft using Medicare information, the AARP reported. The problem is so large the program’s administrators don’t even have a reliable bottom line or a methodology for arriving at the fraud rate. Many experts believe the $60 billion estimate may be too low. They say that fraud could suck off up to 30 percent of the $600 billion per year the program spends.

Large Size Opens Door To Fraud

The problem lies partly in the sheer size of the program, according to Shantanu Agrawal, who is quoted in the AARP article, He is director of program integrity at the Centers for Medicare and Medicaid Services (CMS). He points out the number of claims made every day in the huge system – some 4.5 million. More than a billion dollars are paid out every day.

That volume inherently opens the door to fraud, he said. “We are larger than the largest private payers in the country.” In addition, Medicare is a much more open system than the majority of private payers. Laws required that Medicare admit providers who meet a base set of requirements. They are then allowed to treat patients and bill for those services.

Pre-paying

CMS is trying several methods to ferret out fraud. One approach is by making provider reviews on a pre-pay basis, withholding payment until the applicant has been approved. The agency has made tens of thousands of site visits over the past two years in an effort to close down “false storefronts.” Working with private payers by exchanging data that may identify irregularities has saved the program hundreds of millions, Agrawal said.

Identifying Fake Doctors

The agency also has been more successful in identifying fake doctors. New tools provided by the Affordable Care Act make inroads into the number of unlicensed fraudulent providers. Connections have been made among more than 100 different databases on the state and federal levels. More than 500,000 providers have been removed from the billing system through this effort, he said.

Effects On Medical Research

It is not only patients and legitimate health care providers who suffer from Medicare fraud, experts point out. Medical research that relies on billing data, hospital rankings and cancer studies can be skewed by fraudulent reporting. In some instances, patient deaths have been attributed to fraudulent care.

Legitimate providers are increasingly blowing the whistle on those that they are aware are scamming the system., but they take a risk of repercussions if a case goes against their charges.

Under pressure from critics, program administrators are tightening their oversight, but the challenge is huge and growing.

Watch For Fraud At The ATM

June 11, 2016 By Twila Van Leer

Fraudsters take $650 from each person they successfully skim.

You’d think, wouldn’t you, that you could transact business at an ATM without worrying about fraud. But the crooks are always on the alert, according to an article in the June AARP Bulletin.

Thieves Focusing On ATMs

In fact, automated teller machines have become a focus for some of those determined to benefit at your cost. The introduction of chip-enabled credit and debit cards has made it tougher for thieves to steal your information at the cash register, so they have turned more attention to the ATMs, experts warn.

Increase In Compromised ATMS

FICO Card Alert Service keeps tabs on three in five debit cards used in the U.S. and they have reported a 500-plus percent increase in the number of ATMs compromised by thieves since 2014. The proliferation of inexpensive skimming technology has been used by fraudsters to fuel the increase.

Card-Reading Devices

On average, fraudsters take $650 from each person they successfully skim, according to the ATM Industry Association. They do it by illegally installing card-reading devices at ATMs, gas pumps and other debit-processing machines located in public places. When you insert your card, their device “skims” the pertinent data from the magnetic strip. A nearby hidden camera records your PIN number. The information is then used to make duplicate cards or sold on the black market.

Skimming Technology Constantly Upgraded

The skimming technology is constantly being upgraded, giving the crooks the advantage, the article reports. Banks can’t react fast enough to stay ahead of such tricks as the “shimmers” that crooks implant inside ATM slots to read your card, or the Bluetooth processes they use to transmit your stolen data to other bad guys.

What to do?

Go inside the bank. They aren’t perfectly immune to fraud, but better than the ATM and are usually protected by cameras. The most susceptible ATMS are at convenience stores and other non-bank locations.
Inspect ATM before using it. Be wary of those with card slots that are different colors than the rest of the machine. If there is unusual-looking equipment on the slot, keypad or overhead, avoid using it. If it is difficult to insert your card, stop the transaction. Newer ATMs have a flashing or steady light at the card slot. If it is obscured, don’t use it.
Put your hand over the keypad when punching PIN numbers.
Keep close tabs on cards. Most banks offer real-time alerts via text message or email if there are suspicious transactions.
Create a separate account, smaller than normal and use it only for debit card transactions. That will cut your losses if you are illegally skimmed.
Lower the limit on daily ATM withdrawals to a reasonable amount, say $100 per day so a crook cannot make multiple withdrawals within a short time.

Watch Out For Scary Scams

April 3, 2016 By Twila Van Leer

Medicare

Medicare enrollment time is from Oct. 15 through Dec. 7, and there are scammers out there hoping they can trick you out of your Social Security/Medicare number while you are particularly vulnerable. Be wary of the caller who says he/she is a Medicare employee and that the agency is issuing new cards, that their records need updating or that they can help you with re-enrollment. Don’t you believe it.

Some of these scammers may say you have past-due medical bills. Genuine Medicare employees will never call and ask you for personal information over the phone. They will not visit your home pretending to solicit information the agency already has.

Utility Company

As the weather cools, such unscrupulous frauds may show up saying they are from the local utility company and claiming that you have unpaid bills. They may ask that you pay with your prepaid debit card, which makes it hard to trace. They may suggest that you pay cash and offer to send someone, supposedly a bona fide utility employee, to pick it up.

Again, don’t you believe it. Utilities don’t work that way. They will always send at least one and usually several reminders if you are truly behind, and they do not send employees to pick up payment.

Home Inspections

Another ploy that allows a scammer to dip into your financial resources is the man who shows up to “inspect” your home and supposedly finds serious repairs that need to be taken care of immediately. They may suggest that your chimneys, HVAC ducts or furnace need cleaning. Usually they don’t. Much better to rely on someone with whom you are familiar to do such upkeep.

Investment

At the final quarter of the year, many people are looking for little tweaks they can make to their investments, with an eye to improving their tax situation. If you receive invitations to free lunch seminars to be “educated” about investments, be aware you could end up paying dearly. Such gatherings often are sales pitches for bogus investments. Words such as “risk-free,” “guaranteed” or “limited time” may be clues that you are about to be scammed. Common investment hoaxes focus on oil and gas, precious metals, promissory notes, life settlements and long-maturity annuities. Before you head out for a free lunch, visit brokercheck.finra.org to learn about past lawsuits, bankruptcy filings and other possible irregularities.

Charity Organizations

When the holiday spirit begins to loosen purse strings, scammers come out of the woodwork by the droves. Last year, the focus was ebola. Every natural disaster brings out those who appeal to your humanity to help in the recovery process. Many of the scams are custom-designed for the elderly and they may solicit help for police, firemen or children. If you feel uncomfortable, ask the solicitor to provide you with materials about the suspect charity so you can study them before making a donation. Or go to give.org, charitynavigator.org or the agency in your own state that regulates charities. This information is listed at nasconet.org.

There are dangers of fraud and scam all the time, but especially in the next few months. Don’t start the holiday time of year by letting a scammer treat you to a trick.