The cheaters are winning.
Sophisticated foreign criminals steal tens of billions of dollars from Americans every year, and this crime wave is predicted to get worse as the U.S. population ages and technology like AI makes it easier than ever to commit and get away with fraud.
An “exponential” increase in Internet and telephone scams has overwhelmed police and prosecutors, but relatively few perpetrators are caught and convicted, said Kathy Stokes, director of fraud prevention for AARP’s Fraud Watch Network.
Victims, including seniors who have lost their life savings to romance scams, grandparent scams, tech support scams and other common scams, rarely ever get their money back.
“We’re at a crisis point with fraud in society,” Stokes said. “It’s so easy to be a criminal that a lot of people are joining the fray. They don’t have to follow any rules, they can make a lot of money and there’s very little chance of them getting caught.”
A recent case in Ohio in which an 81-year-old man was targeted by scammers and allegedly fought back with violence highlights the challenges of law enforcement.
Police say the man shot and killed the Uber driver because he believed she was trying to scam him out of $12,000 in bail money for a relative. I was a victim of the same scammerAuthorities said they were dispatched to a home halfway between Dayton and Columbus to pick up a package for delivery.
Homeowner William Block has been charged with murder in the March 25 shooting death of Lo-Resa Hall, but the con man who threatened him over the phone and set off the series of tragedies remains at large more than three months later.
Bullock pleaded not guilty, saying he feared for his life.
Advantage Scammers
Online and phone scams have become so common that law enforcement and adult protective services lack the resources to respond.
“It’s like drinking from a fire hose,” said Brady Finta, a former FBI agent who oversaw investigations into elder fraud. “Logistically and rationally, there are just so many scams that it’s nearly impossible to overcome at this point.”
Fraud can be difficult to investigate, particularly those that occur overseas, where stolen funds are quickly converted into hard-to-trace cryptocurrencies or diverted to overseas bank accounts.
Paul Greenwood, who has prosecuted elder financial abuse cases in San Diego for 22 years, said some police departments don’t take financial fraud as seriously as other crimes, and victims end up feeling discouraged and demoralized.
“A lot of law enforcement officials think that just because a victim voluntarily sends money to buy a gift card or a wire transfer or cryptocurrency, that it’s actually a consensual transaction,” said Greenwood, who travels around the country teaching police how to spot scams. “But that’s a big mistake. It’s not a consensual transaction. They’re being scammed.”
Federal prosecutors typically don’t get involved unless the fraud reaches a certain amount, Greenwood said.
The Department of Justice has said it does not set a uniform monetary threshold for federal prosecutions of elder financial abuse, but some of the nation’s 93 U.S. Attorneys’ Offices have confirmed they can set their own thresholds, prioritizing cases with a large number of victims or a large financial impact. Federal prosecutors bring hundreds of elder fraud and abuse cases each year.
The Federal Trade Commission says the “vast majority” of scams go unreported, and victims are often hesitant to come forward.
A 74-year-old woman recently charged with robbing a north Cincinnati credit union was the victim of an online scam, her family said. Authorities believe she was targeted by con artists, but there is no record of a formal police report.
“These guys are very good at what they do and they’re very good at scamming people out of their money,” said Sergeant Brandon McCloskey of the Fairview Township, Ohio, police, who investigated the robbery. “I’ve seen guys who want to get into a fistfight with the police and with the bank tellers because in their hearts they believe they have to take the money.”
A devastating plan
Older people, as a group, hold more assets, making them attractive targets for fraudsters. The impact can be devastating, as many of the victims are past working age, leaving little time to recoup losses.
Complaining about elder fraud to the FBI’s Internet Crime Complaint Center Up 14% last yearLosses rose 11% to $3.4 billion, it said. Recent FBI Report.
Other estimates put the annual losses at even higher levels.
According to a 2023 AARP survey, Americans over 60 $28.3 billion loss Every year, millions of people are scammed. The Federal Trade Commission is trying to account for unreported losses, and estimates that scammers are scamming They stole a massive amount of money, $137 billion. Revenues of $2 billion are expected to come in in 2022, including $48 billion from seniors. The study’s authors acknowledged “considerable uncertainty.”
William Boltz, 80, of San Diego, said criminals stole about $700,000 of his family’s savings in an elaborate scheme that included non-existent Amazon orders, a fake “refund processing center” in Hong Kong, falsified bank statements and instructions that Boltz needed to “sync his bank accounts” to get his money back.
Boltz’s scammers were persistent and persuasive, pestering him with dozens of phone calls and, at one point, taking over his computer.
Despite being the victim of a crime, Boltz struggles with remorse.
“I understand now why so many elder abuse scams go unreported, because you look back and think, ‘How could I have been so stupid?'” said Boltz, who is retired after a career in banking, financial services and real estate.
His daughter, Abe Williams, said local police and the FBI tried hard to track down the overseas scammers and recover the money, but repeatedly hit dead ends. The family blames Boltz’s bank, but Williams says the bank ignored multiple red flags and helped her father make multiple large transfers over an eight-day period. The bank denied any wrongdoing, and the family’s lawsuit was dismissed.
“Fraudsters are getting more and more sophisticated,” Williams said. “We need to give police the tools they need, and we need to give banks more capacity because they’re the first line of defense.”
The Justice Department argues the U.S. cannot solve the problem through prosecutions alone and that the industry needs to do more.
“Private industry, including the technology, retail, banking, fintech and communications sectors, must make it harder for fraudsters to defraud victims and launder their proceeds,” the agency said in a statement to The Associated Press.
The way forward
Banking industry officials told a Senate subcommittee in May invest heavily in new technology “And some of them hold great promise” for thwarting fraud. The American Bankers Association says it is working on programs to coordinate real-time communication between banks to better flag suspicious activity and reduce the flow of stolen funds.
But industry officials say banks alone can’t stop fraud, and that the U.S. needs a comprehensive national strategy to combat fraudsters, saying the federal government’s current efforts are piecemeal and uncoordinated.
Finta, a former FBI agent who founded the nonprofit National Elder Fraud Coordination Center to improve cooperation between law enforcement and major companies like Walmart, Amazon and Google, said law enforcement and industry need to work together to fight fraud more quickly and efficiently.
“There are some very smart people and some very powerful, wealthy corporations who want to stop this fraud,” he said, “so I think we have the power to have a bigger impact and help our law enforcement colleagues who are suffering from this tsunami of fraud.”
