This is not my favorite subject. But it is a necessity these days, when a seemingly endless number of companies and individuals are bent on ripping us off our money. Some of them will use any means, fair or dishonest.
I’m going to share a story about a longtime friend (I’ve changed his name) whose kindness and generous nature were used against him when he was vulnerable.
this could be you
As much as I’ve ever known, my friend (I’ll call him Bill) was a gentleman and a gentleman. He treated everyone with respect; He was honest and trustworthy. And he was always ready to help any needy.
His wife passed away a few years ago, and Bill considered opening his mail as a daily highlight.
We all know the general content of mail. If you split your mail into two heaps, one for the people or organizations sending you money and the other for the people or organizations who want your money, almost everything will go to the second pile.
Now imagine that reality from Bill’s point of view: Mail is such an important regular occurrence, you read every piece of mail, and you never want to say no.
Bill’s generosity was his ticket to the growing number of mailing lists that charitable organizations bought and sold.
Fortunately, Bill befriends a woman we’ll call Anita, a nurse he met at the hospital during his wife’s last illness. Anita lived with Bill and eventually became his caregiver.
One day when Anita stopped near his house, Bill told her that he had just gone to the bank. What he heard prompted him to offer to help with his bills and finances.
Bill always answered the phone, and the previous day he had said yes to someone who asked him to send money directly from his bank account.
Billed $1,600 wired. The next day, the same person called back to say that the wire transfer had not happened. He asked to resend the bill for $1,600.
Bill went to the bank and (luckily for him but not for the scammer), the teller knew Bill. Not only did she stop him from doing that transaction, but he also helped her to report the fraud claim.
Anita soon learns that Bill has written 108 checks to 14 charities and political organizations in just one month. Checks were small, usually $10 to $25 each. But they added up to huge financial outflows.
Then he discovered that Bill had somehow signed up for monthly withdrawals from his bank account for things like “internet repair services,” extended warranties on items he no longer owned, and undefined technical support. He was unaware of these “services” he was buying.
At the suggestion of his bank, Bill closed his account, although he did not want to because he had memorized the account number.
Anita suspected that she was being taken advantage of in other ways. Oh, was she ever right.
He noticed that he was receiving large boxes full of ingredients that were apparently part of the “start your business from home” plan he had signed up for, thinking it would give him something to do. He opened a box and found that it contained a $325 invoice for “supplies and prescriptions.”
The losses from that particular scam were huge, as I found out when I got involved. All told, the effort to keep Bill busy and useful cost him over $100,000.
Fortunately, Bill trusted Anita completely, and she soon got her financial affairs under control. Among other things, he persuaded her to review any checks she had written before putting them in the mail. And he set up a laptop in a way that made it easy for them to monitor his bank account.
Unfortunately, many other seniors have no one like Anita to help them.
With such a friend, do you need an enemy?
Sometimes, the “assistant” turns out to be a badass.
I knew a retired couple who depended on the choir in their church for investment advice. When he inherited $50,000 – a huge sum for him – he turned to this “friend”.
The director of the choir was not a trusted advisor, and he had become very good at gaining the trust of the parishioners. (Maybe you can figure out where this is going.)
From an objective standpoint, the couple had very little risk tolerance; They could not afford to lose this money.
Nevertheless, once they found out about the legacy, the choir persuaded the couple to invest in a limited partnership, thus earning themselves some hefty sales commissions.
A limited partnership was invested in a coal-mining venture. The other was financing a grove of palm trees in South America.
If I hadn’t intervened, most likely the couple would have lost all their money while the choir director kept his commission. But when we threatened legal action against the director of the choir and the firm they worked for, the couple recovered all their money.
Another story is about a friend who works for a moving and storage company.
An elderly man living in a downtown Seattle hotel orders things online, sometimes with daily visits from a paying caregiver. He received packages which were delivered directly to his room with the blessings of the hotel.
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One day a UPS driver realized she was delivering six to eight packages a day to this guy, and realized that something might be wrong. It didn’t take long for the driver to determine that most of the deliveries were things the caregiver had ordered for himself, of course they were charged to the man’s credit card.
Luckily, the solution was simple: a new credit card number — and a new caregiver.
There are countless other ways in which older people fall prey to those who want their money, any way they can get it. COVID-19 scam. banking scams. phone scam. IRS scam. Charity scam. investment scam. Pyramid Schemes.
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The US government has created a excellent online resources To help identify these and more, and to protect yourself or someone you care about.
If you use email, you are a target. You may receive messages asking you to confirm “Account Information,” including your phone number and shipping address. Maybe “there’s a problem with your bank account” – even at a bank where you don’t have an account.
What to do: Maybe the number 1 all-purpose suggestion I have is to just slow down. Any transaction you make is not so urgent that it can’t wait for you to think about it or get a second opinion from someone who has earned your trust.
Educate yourself on the government website. Do not provide personal information over the phone unless you have initiated the call.
I hate the need to give blanket advice in order to be skeptical. But as many people have learned the hard way, it can be great advice. In fact, that advice could save you more dollars than you think.
Richard Buck contributed to this article.
Paul Merriman and Richard Buck are the authors of We’re talking millions! 12 Simple Ways to Supercharge Your Retirement,