Preventing Elder Fraud During the Pandemic

by Megan T. Kelly, CPA, CFE, CVA, SobelCo – May 3, 2022
Preventing Elder Fraud During the Pandemic

According to the FBI’s Internet Crime Complaint Center (IC3), older Americans (those over age 60) lost approximately $1.7 billion in 2021 to financial exploitation schemes, up from approximately $966 million in 2020. The number of victims who reported complaints to the FBI was in excess of 90,000. Seniors are targeted because they are trusting, often isolated, tend to be less technologically savvy and usually have savings or a steady stream of retirement income, thus making them prime targets for fraudsters.

As the COVID-19 pandemic continues to keep older people more isolated, especially during surges in the virus due to new variants, it is important to be aware of schemes that are targeting the elderly and know how to prevent your elderly friends, family members and clients from falling victim to these schemes.

Top Schemes

Two years into the COVID-19 pandemic, many older Americans are still having to take extra measures to protect themselves against the virus and its numerous variants, including remaining more isolated than prior to the emergence of the virus. This isolation can create psychological distress that, unfortunately, leads the elderly to be more susceptible to fraud. Per the FBI IC3 report, some of the most prevalent crimes reported by those over age 60 in 2021 were as follows:

  • Government impersonation. With these scams, a caller contacts a potential victim claiming to be from a government agency like the IRS or the Social Security Administration, alleging fraud on an account or unpaid debts, and demands immediate payment or access to the victim’s personal identifiable information. In 2021, victims lost nearly $69 million due to this fraud scheme.
  • Romance scams. More and more Americans are utilizing online dating in order to meet potential love interests, which has led to a rise in romance scams. A scammer utilizes a fake identity to feign romantic interest in an unsuspecting victim and then uses the relationship to steal money or information from the victim. Typically, a story about a fake crisis is concocted in order to convince the victim to send funds.
  • Grandparent scams. A fraudster pretends to be a grandchild in distress or someone claiming to represent the grandchild as they are hospitalized or imprisoned, and the only way for the grandchild to get out of this nonexistent situation is for the relative to wire money to the scammer. In 2021, criminals stole more than $700,000 from an 82-year-old woman in Florida by utilizing this scheme. Per the IC3, in 2021 there were more than 450 reports of this type of scam with approximate losses of $6.5 million.
  • Tech support. Criminals pose as tech support to resolve issues relating to a compromised email account or computer software license renewal and demand payment in order to resolve these nonexistent issues. In 2021, the IC3 received nearly 14,000 complaints related to this type of fraud, resulting in nearly $238 million in losses. Elderly victims accounted for 58 percent of the total complaints and 68 percent of the total losses.
  • Investment fraud. These schemes typically involve an alleged low-risk investment with guaranteed, consistent, high returns. In 2021, older Americans lost in excess of $239 million due to this type of fraud scheme, up from $98 million in 2020.
  • Sweepstakes/lottery scam. This involves falsely claiming that an individual has won a lottery or a free vacation, but in order to receive the prize, they have to pay a fee first. Scammers will often ask for bank account information to transfer winnings.
  • Cryptocurrency. The IC3 received more than 5,100 complaints related to cryptocurrencies, including Bitcoin, Ethereum, Litecoin and other lesser-known coins. Losses associated with these victims totaled over $241 million. The most common crypto scams involved aspects of other scams, including romance and investment scams. Additionally, cryptocurrency ATMs are becoming more prevalent and are largely unregulated.

It cannot be stressed enough that the increased isolation and anxiety due to the COVID-19 pandemic leads seniors to be vulnerable to fraud, and it is important to be proactive about protecting our more vulnerable populations from these schemes.


In December 2020, the Elder Justice Task Force of the Department of Justice in the District of Puerto Rico launched an elder fraud education and prevention campaign. The goal was to raise awareness about the different types of fraud the elderly could be exposed to, especially with the onset of the COVID-19 pandemic, and how to advise senior citizens and caretakers on reporting and preventing these scams. Other entities that have joined this campaign are the Postal Inspector Service, the U.S. Department of Health and Human Services, Office of the Inspector General, the Federal Trade Commission and the FBI.

Now more than ever it is important to continue to remain in contact with your older relatives, friends or clients through regular phone calls to discuss the importance of remaining proactive about potential fraud schemes. Be aware of any behavioral changes, as this could be a sign that an individual is experiencing financial distress. Some suggestions to avoid scams, per the Federal Communications Commission and the FBI, include the following:

  • Don’t respond to phone calls or texts from unknown numbers.
  • Never share your personal identifiable information or bank account information with an unknown individual.
  • Understand that the government will never call you asking for your personal identifiable information or make threats regarding back taxes or revocation of benefits.
  • Research the legitimacy of a charity before making a donation.
  • Never click any links in text messages or emails from unknown sources.
  • Recognize that if an offer seems too good to be true, it likely is, and avoid “get rich quick” schemes.
  • Never send money to strangers, but particularly people with whom you have only communicated with via phone or online messaging.
  • Resist the pressure to act quickly when communicating with an unknown person.

The statistics reported by the IC3 are likely underreported, as many elderly victims of fraud are hesitant to report the crime because they are embarrassed or feel shame and worry about losing independence. However, if someone has been a victim of a fraud scheme, it is important to contact law enforcement immediately. A complaint can also be filed with the FBI’s IC3.

Megan T. Kelly

Megan T. Kelly

Megan T. Kelly, CPA, CFE, CVA, is a senior manager in forensic and valuation services at CliftonLarsonAllen (CLA). She is a member of the NJCPA Content Advisory Board.

More content by Megan T. Kelly:

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting, investment or tax advice or opinion provided by CliftonLarsonAllen LLP (CLA) to the reader. For more information, visit CLA exists to create opportunities for our clients, our people and our communities through our industry-focused wealth advisory, digital, audit, tax, consulting and outsourcing services. CLA (CliftonLarsonAllen LLP) is an independent network member of CLA Global. See Investment advisory services are offered through CliftonLarsonAllen Wealth Advisors, LLC, an SEC-registered investment advisor.