Financial exploitation of older adults is a serious and growing concern. As Natalie Ebner, Professor of Psychology at the University of Florida, explains, older adults often have accumulated wealth, hold positions of authority, and make crucial financial and health-related decisions. This combination makes them particularly attractive targets for fraudsters.
When older individuals fall victim to financial scams, the impact can be severe. Unlike younger victims, older adults have less time to recover their losses, which can significantly affect their independence, health, and overall well-being. In India, the elderly population currently numbers 153 million, highlighting the urgent need to protect this vulnerable group from financial exploitation.
Common scams targeting older adults
To protect our parents and grandparents, it’s important to be aware of the various scams prevalent today. According to Visa, a payment system operator, these are the scams you need to be wary of:
AI-powered scams
Advancements in artificial intelligence have enabled scammers to develop sophisticated methods like deepfake videos and digital skimming codes. These technologies allow fraudsters to convincingly impersonate others. For instance, earlier this year, a multinational firm in Hong Kong lost around $26 million after scammers used deepfake technology to impersonate senior executives. The fraudsters accessed publicly available video and audio of the executives through YouTube and used this data to create fake videos and voices, which were then used to deceive company employees into transferring funds.
To protect against such scams, it’s crucial to stick to trusted payment gateways, verify the source of any suspicious videos or audios, and never share personal or financial information with unverified sources.
Malware-driven scams
Scammers often use enticing offers, such as cashback links or emails with too-good-to-be-true deals, to trick people into clicking on malicious links. These links can lead to the installation of malware on the victim’s device, compromising their personal information and financial security. To avoid falling victim to such scams, refrain from clicking on unverified links and ensure your devices are protected with up-to-date antivirus software.
QR code scams
QR codes are becoming increasingly popular, but they also present a new avenue for fraud. Scammers can disguise harmful links as QR codes, luring victims with promises of freebies or discounts. Once scanned, these codes can direct victims to malicious websites or apps, leading to financial loss. It’s essential to exercise caution when encountering QR codes, especially those offering free gifts or services. Avoid sharing UPI IDs or bank details with strangers and verify the authenticity of any transaction before proceeding.
Digital arrests
A particularly distressing scam involves criminals posing as law enforcement officials and threatening victims with arrest unless they pay a “fine” or share sensitive information. This tactic, known as a “digital arrest,” preys on fear and confusion. Victims should remain calm, avoid engaging with such callers, and contact their bank’s official customer service for assistance. Additionally, blocking compromised accounts and cards can prevent further loss.
For example, a woman in Noida was recently duped out of over Rs 11 lakh when scammers posed as police officials and accused her of being involved in a money-laundering case. The scammers used the names of real police officers and well-known public figures to make their story more convincing, keeping the victim in a state of fear for an entire day.
Making smart payment choices
With the numerous digital payment options available today, choosing a secure method is vital. Payment methods that use tokenisation, such as certain types of credit and debit cards, offer enhanced security by generating unique transaction codes instead of sharing actual card details. This reduces the risk of data breaches. The Reserve Bank of India’s initiative to promote tokenisation, launched in 2021, has been widely adopted and provides a layer of security for digital transactions.
Other common victims of financial scams
While older adults are often targeted, they are not the only ones at risk. Other common victims include:
* People experiencing loneliness or isolation
* Individuals with limited financial literacy or investment experience
* Those undergoing significant life changes or emotional distress
* Middle-aged individuals with substantial savings or retirement funds
* Naturally trusting or empathetic individuals
* Users on social media platforms like Telegram and Instagram
* Homemakers and retired individuals looking for quick money
Reporting financial scams
If someone falls victim to a financial scam, several steps can be taken to seek recourse:
* Lodge a formal complaint with local police or the economic offences wing.
* Provide relevant documents and evidence to support the case.
* Report the scam to regulatory authorities like the Securities and Exchange Board of India (Sebi) or the Reserve Bank of India (RBI).
* Authorities can also play a crucial role in educating the public about such scams, helping to prevent future incidents.
“Scammers are adapting novel techniques to target vulnerable populations like the elderly, using sophisticated schemes such as digital arrest threats and AI-driven scams. These aim to trick them into making fraudulent transactions. Therefore, it’s crucial that responsible, digitally-savvy youngsters keep their parents and elders informed about these emerging threats and help them take simple, proactive steps to stay safe online,” says Vipin Surelia, Vice President and Head of Risk Services at Visa India and South Asia.
First Published: Aug 01 2024 | 4:01 PM IST
