There has been a significant rise in Social Security-related scams, reports the Senate Special Committee on Aging.
With June 15th being World Elder Abuse Awareness Day, it seems like an appropriate time to take a closer look at how criminals are targeting the retirement savings of senior citizens in the U.S.
While elder abuse can take many forms, financial exploitation and theft are among the most common. It is estimated that older Americans lose a staggering $2.9 billion a year to an ever-growing array of financial exploitation schemes and scams, but the real figure is likely much higher because so many incidents are never reported.
Seniors are being targeted by criminals who want to rob them of their hard-earned retirement savings, and senior citizens in particular are targeted for Social Security-related scams and financial exploitation because they are, of course, more likely to be receiving Social Security benefits. They are being exploited by strangers over the telephone, through the mail, and online. Worse yet, far too many seniors may also be targeted by family members or by other people who they trust, which makes them even more vulnerable.
SSA’s Office of the Inspector General (OIG) continually works to increase awareness of how to identify and prevent Social Security-related fraud. The OIG has a Scam Awareness page on its website to inform the public on how to recognize potential schemes and safeguard themselves from identity theft and financial exploitation. SSA also has a Fraud section of its Social Security Matters blog, which has a lot of helpful information, and the Federal Trade Commission now has a webpage specifically targeted to SSA scams.
Impersonation scam
A notable development in the past year has been the rise of Social Security impersonation scams.
According to the Senate Special Committee on Aging, led by Sen. Susan Collins (R-ME), Chairman, and Sen. Robert P. Casey (D-PA), this scam generated by far the most calls to its Fraud Hotline (1-855-303-9470) in 2019, supplanting an IRS impersonation scam that had been the top reported scam since the hotline was first set up in 2013.
The committee’s “Top 10 Most-Reported Scams,” included as part of its 2020 “Protecting Older Americans Against Fraud” book, shows 2019 saw a marked decline in reports of the IRS scam and a large increase in reports of the Social Security scam.
This scam, which was the focus of more than twice as many calls as any other scam, involves scammers posing as employees of the Social Security Administration in order to fraudulently take money or obtain personally identifiable information (PII) from victims. In one common version of this scam, victims are told that their Social Security number has been linked to a crime and the situation can only be resolved by sending payment or PII.
While the Fraud Hotline has received reports of this con for several years, it jumped from the seventh-most reported scam of 2018 to the most-reported of 2019. In the first half of 2019, the FTC received almost double the number of Social Security Scam complaints than it received in all of 2018, with total reported losses of just under $17 million.
The scammers often “spoof” the SSA’s public numbers to make it appear as if the fraudulent call is actually coming from the SSA. While there are several variations to this scam, the general theme involves the scammers calling victims to fraudulently take money from them or obtain their PII.
In one common iteration of the scam, the fraudsters will attempt to scare consumers by claiming that their Social Security number has been suspended due to suspicious activity or has been used in a crime. The scammers will say the situation can only be resolved by providing sensitive personal information over the phone or by paying a sum of money using a particular means of payment, such as gift cards. These tactics aim to panic the consumer by creating a false sense of urgency, and many individuals do indeed panic and give away their information and money.
It is important to note that SSA employees occasionally reach out by telephone for customer-service purposes. In only a few special situations, usually already known to the individual by previous direct contact with the agency, an SSA employee may request the confirmation of personal information over the phone. SSA warns that legitimate SSA callers will provide a telephone number and extension.
COVID-19 scam
Back on March 20, the Inspector General of Social Security, Gail S. Ennis, warned the public about fraudulent letters threatening suspension of Social Security benefits due to COVID-19 or coronavirus-related office closures. Ennis reaffirmed the Social Security Administration (SSA) will not suspend or discontinue benefits because of offices being closed.
The OIG has received reports that Social Security beneficiaries have received letters stating their payments will be suspended or discontinued unless they call a phone number referenced in the letter. Scammers may then mislead beneficiaries into providing personal information or payment via retail gift cards, wire transfers, internet currency, or by mailing cash, to maintain regular benefit payments during COVID-19 office closures.
Local SSA offices closed to the public due to COVID-19 concerns as of March 17, 2020; however, Social Security employees have continued to work. Social Security will not suspend or decrease Social Security benefit payments or Supplemental Security Income payments due to the current COVID-19 pandemic. “Any communication received that says SSA will do so is a scam, whether you receive it by letter, text, email, or phone call,” Ennis’ warning states.
If someone is ever confused or unsure whether they are speaking with a real SSA employee, they should request that they call back later, after the person has verified that the caller is legitimate by calling the SSA Inspector General’s toll-free number (1-800-772-1213).
In addition to phone calls, some people have reported getting emails claiming to be from SSA. According to SSA’s website, “Social Security will not send you an email asking you to give us your personal information, such as your Social Security number, date of birth, or other private information. If someone saying they are from Social Security does email you requesting information, don’t respond to the message.”
Among the other most-common scams according to the committee report, robocalls ranked second, followed by sweepstakes/Jamaican lottery scam, romance scams, computer tech support scams, grandparent scams, and IRS impersonation scams.
SEE ALSO:
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
