Friday, September 9, 2011

Senior on Senior Scams


Elderly couple
Originally uploaded by Wanderer and Wonderer

An article in AARP’s September/October magazine discussed the rise of aging scammers targeting other seniors. The article states that seniors appear to be more trusting of senior scammers who present to identify with the financial concerns of older people. Jenni Bergal author of the article stated that a popular fraud targeting senior citizens is the Ponzi schme. The Ponzi scam was named after Charles Ponzi a notorious scammer in 1920, and who could forget Bernie Madoff who in 2008 swindled millions from trusting investors.

How the Ponzi scheme works is that potential investors are guaranteed high returns on his/her funds and assured that there are no risks. The scammer then pays off investors with money received from new investors while living off the bulk of the money received. While the scammer continues to recruit new investors the well can run dry. When not enough investors come on board to keep the scammers lifestyle and provide money to give out to some investors the scammer usually disappears if not caught by the law.

Suggestions:

1)  If it sounds too good to be true walk away
2)  Do your research don’t let greed or false hope make the decision for you. Contact your state securities
     agency for further information about any person or company that presents investment opportunities to you.
3) Take your time don’t allow yourself to be rushed. Being impulsive can cost you your life savings like it has
     so many.

Not too long ago I watched a report on television about a man who scammed a few church pastors and their congregations out of thousands of dollars. No one is off limit. Our present economic climate has made many afraid of the future. This fear is resulting in poor decision-making. We must all educate ourselves when presented with information and request for our assets.

Have you or someone you know been approached with a too good to be true offer? If so please comment here and help others.

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