With tax time almost here, the IRS is warning of a new type of fraud involving ill-gotten refunds deposited into accounts and taxpayers tricked into turning over the loot to the scammers.
It’s a new wrinkle in an old story: identity theft. For a variety of reasons, the problem is even more prevalent among older adults. What do seniors need to know about identity theft, and what steps can your community take to help keep residents safe?
Seniors: A Frequent Target
Identity theft happens when a scammer gets access to an individual’s date of birth, bank account number, Social Security number and other valuable, identifying information. That data then can be used for a range of nefarious purposes, including opening new financial accounts and filing fraudulent tax returns.
Many identity thieves view seniors as prime targets for several reasons: Seniors often answer their phones, they have higher asset levels than the general population, and they may be more trusting of strangers. In addition, some seniors have memory loss or early dementia that can make it easier for a fraudster to gain access to personal information and accounts.
Common Forms of Identity Theft
Thieves constantly create new ways of committing identity theft to steal passwords and account information.
Mail theft: Despite all the information online today, one of the easiest methods is from the old school — stealing mail. Taking mail from a senior is not difficult, and thieves also will rifle through trash cans to find documents that include private information.
In addition, thieves may send seniors pieces of mail that seem official, as if they came from a bank, charity or the government. Such fraudulent mail can be difficult to tell from the real thing.
Phishing scams: Older adults who spend time online may get caught in “phishing” scams in which criminals send spam emails that look like they came from a big bank or shopping site. The emails ask people to verify their details, and the unwitting victim clicks through to a scam site that collects information such as Social Security numbers and banking log-ins.
Telephone scams: Among the most common types of identity theft scams targeting seniors, the phone is a common tool. Scammers will call pretending to work for Medicare, the IRS, banks or charities. Unsuspecting seniors may believe the calls are from the real source and turn over personal information.
Tax and benefits theft: Identity theft relating to taxes and government benefits often occurs after a fraudster skims obituaries to find out about recent deaths. The crook then contacts the Social Security Administration to get the master death file, which provides Social Security numbers that are used to claim tax refunds before the bereaved family can file a return.
Scammers can also hijack a senior’s tax refund or government benefits through email and telemarketing. Once a thief has a senior’s information, including a Social Security number, they can redirect government payments to their accounts.
Medical identity theft: A recent study found that more than 95 percent of health care organizations have experienced at least one serious breach of medical information, and seniors often are the victims of such compromised systems. Fraudsters who gain access to a senior’s private medical information can wreak havoc with Medicare numbers and other personal information.
Educating Seniors to Reduce Fraud
What can your community do to help seniors protect themselves? You can use your website, social media and other channels for disseminating information to share tips for spotting scams and preventing identity theft.
To avoid identity theft related to taxes, seniors and their loved ones should immediately contact credit bureaus if any private information is breached. In addition, they should file a police report and an identity theft affidavit with the IRS if they are victimized. Even if seniors do not believe identity theft has occurred, they should request copies of their credit reports each year and request freezes on their credit files.
Seniors also should use caution with their private documents to avoid all types of identity theft. For example, they should pay attention to waiters and others who take their credit cards out of sight, and they should shred any financial paperwork like bank statements before discarding.
Tax time brings identity theft into view, but fraud is a problem for seniors throughout the year. By sharing important information with your residents and other elders in your area, your community can become a resource and part of the solution.