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.

PBS recently aired the results of its study into the issue of Americans use of 401(k) accounts as a vehicle to accumulate savings for retirement. PBS’ study determined that with the cost of living rising and life expectancy increasing, figuring out how much to save for retirement is extremely challenging. Even more challenging is attempting to determine how to invest money into your 401(k). PBS’ study indicated that retirees utilizing a 401(k) account should take the following subjects under consideration. If you are one of the 60 million Americans who currently invest in a 401(k) plan here is what you should consider:

1. Investment Fees: PBS’ study found that the average Mutual Fund brings with it a fee of 1.3 – 2%, with some being as high as 5%, for administration, asset management and other fees. While the percentage may see low, the average person spends $155,000 in fees over the lifetime of their 401(k) plan;
2. Fiduciary Duty: PBS defined fiduciary relationship to be when one person has an obligation to act for another’s benefit. Investors should confirm the financial advisor’s agreement to be a fiduciary and act in your best interests;
3. Kickbacks: PBS’ study found that kickbacks occur when a company pays a broker a portion of revenue to sell that company’s funds. The kickback is eventually paid by the consumer in the form of fees. Make sure that your investor is not obtaining a kickback from the fund he or she is proposing you invest in; and
4. Index Funds: Index funds are a type of mutual fund that is designed to match or track the components of a market index such as the Russell 2000 or S&P 500. The PBS study found that Index Funds may be more appropriate for some retirees because they funds have low fees, no manager and hold broadly diversified funds, and index funds tend to outperform even the best mutual funds over the long term.

For more regarding the PBS study please visit:

http://www.pbs.org/wgbh/pages/frontline/retirement-gamble/

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.

Most financial advisors will tell you that every investment carries some element of risk. But when an investment is fraudulently presented, those risks become greater, unexpected and far more costly. One typr of fraud involves luring investors with exaggerated claims of the value of the investment. If this is the case, you may need a securities fraud attorney to assist you in pursuing a claim to recoup your financial investment.

Making exaggerated or deceptive claims in order to draw investors is not viewed kindly by the SEC. Such is the case with the city of Victorville, CA.

The Securities and Exchange Commission has filed suit against the city, alleging that the city defrauded investors by misrepresenting the worth of some property, namely airport hangers, by greatly overstating their value. The SEC claims that the city, struggling financially since the closure of an Air Force Base in 1992, made this misrepresentation as part of a plan to raise funds for redevelopment through the sale of municipal bonds.

The SEC alleges that investors were defrauded because they received inaccurate information which made it impossible for them to weigh the risks of investing in the municipal bonds.

Making informed decisions regarding investments is difficult enough, but false information and misrepresentation can often mean that an investor is taking on a risk he never intended and could suffer losses that he could not reasonably foresee or predict.

If you’ve incurred investment losses, or if you are a victim of securities fraud, financial malpractice, a Ponzi scheme, a pump and dump scheme, or theft by a FINRA registered broker, please contact the investment loss attorneys of The Costello Law Group at (877) 418-0003 for a free consultation.