How Tech Support Scammers Target Older Adults and Drain Their Retirement Savings

**Tech Support Scam Leaves Retiree Penniless: The Growing Threat to Older Americans**

Marjorie Bloom, a retired civil servant and widow, fell victim to a tech support scam in the spring of 2021 that left her devastated financially. The scam, which is becoming increasingly common and targets older adults, resulted in Bloom losing her entire life savings of $661,000.

The scam began when Bloom received a call from someone claiming to be a “fraud investigator” at her longtime bank, PNC. The man convinced her that criminals were in the process of stealing her savings using stolen personal data, and in order to protect her money, she needed to move it quickly and secretly. Bloom trusted the man and liquidated her nest egg, only to discover later that she had been defrauded.

Tech support scams like these have been on the rise, with older adults losing a staggering $588 million to such scams in 2022, as reported by the Federal Bureau of Investigation (FBI). These scams involve criminals impersonating computer technicians and persuading victims that they have a serious computer issue. They then convince victims to wire funds to fraudulent accounts, resulting in significant financial losses.

Bloom’s case highlights a concerning trend where advancements in technology, complex investment options, and gaps in financial protections expose older Americans to financial fraud. In 2022, Americans aged 60 and older lost $3.1 billion to cyber fraud, marking an 84% increase from the previous year. The true scope of fraud may be even greater, as many incidents go unreported.

With older adults often having significant retirement savings, including home equity, Social Security payments, and pension checks, the consequences of fraud can be devastating. Beyond immediate financial losses, victims may face additional challenges, such as owing a hefty tax bill due to raiding retirement funds, increased debt from taking out loans or maxing out credit cards, and the difficulty of recouping money from criminals or financial institutions.

As the U.S. undergoes a massive demographic shift, with an average of 10,000 baby boomers reaching retirement age each day, protecting older adults from financial fraud becomes increasingly important. This generation has shouldered more responsibility in preparing for retirement, as traditional pensions have given way to 401(k) plans. Vanguard Group reports that consumers aged 65 and older had an average of $232,710 in 401(k) plan savings in 2022, with a net worth of over $1.2 million for 65- to 74-year-olds.

The psychological techniques employed by scammers further increase the vulnerability of older adults. Tech support scams, in particular, often employ an “amygdala hijack” method, triggering strong emotional reactions that overwhelm the rational part of the brain. Older adults, who may be less tech-savvy and more likely to be at home or using landline phones, are frequently targeted due to their vulnerability.

The COVID-19 pandemic exacerbated the threat to older adults, as it kept people indoors and forced them to rely more heavily on technology. This resulted in a surge of exploitative practices targeted at older Americans, according to U.S. Attorney General Merrick Garland’s report to Congress in 2022.

Bloom’s story serves as a reminder of the urgent need for better protections for older Americans against financial fraud. The devastating impact of these scams goes beyond financial losses, affecting victims emotionally and potentially compromising their retirement plans. It is crucial for financial institutions, law enforcement, and individuals to be vigilant and take proactive measures to prevent and combat these scams. By raising awareness and providing resources and support, we can help protect older adults from falling victim to these increasingly common frauds.

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