The elderly are often the target of Ponzi schemes. According to a joint study by the MetLife Mature Market Institute, the AARP Foundation and the Investor Protection Trust, the estimated cost of financial fraud against the elderly in 2010 was $2.9 billion, up 12 percent from 2008. Additionally, experts estimate 85 percent of elderly victims do not report fraud because they are embarrassed or fear their families will restrict their financial freedom.
The elderly are a particularly vulnerable group. Consider other statistics from the research that show what makes them easy targets and how they are approached.
- Older women are twice as likely to be victims than men.
- Most elderly victims are between 80 and 89 years old.
- The average age of elderly victims is 69.
- The majority of victims live alone and need help with daily activities.
- 12 percent of elderly securities fraud happens in the business sector.
- 51 percent of victims are taken advantage of by strangers.
- 34 percent of elder fraud is committed by a family member or other person close to the victim.
Elderly victims are targeted in many different ways. Often times an untruthful financial advisor will sell investments that are not appropriate for an elderly person’s portfolio, or they will lie about the risk level. Many cons will pressure older clients by telling them the window of investment is very short, leaving them no time to research or thoroughly investigate before making a decision. They will even resort to emotional tactics, getting the elderly to invest in supposed humanitarian projects or convincing them they are taking care of their families by investing. In addition to bad investments, some elderly have been deceived into completely signing over control of their assets or accounts to an investor.
There’s no shortage of tactics used by fraudulent investors, and it’s not likely to get better in the future. An estimated 40 million Americans are over 65 right now. That number is expected to double by 2050. An increasing elderly population is a haven for those who want to take advantage of them.
If a financial adviser has changed your strategy without your permission or if you are a victim of securities fraud, financial malpractice, Ponzi scheme, broker theft by a FINRA registered broker please call the securities attorneys of The Costello Law Group at (877) 418-0003 for a free consultation.