Published in RINewsToday on September 23, 2024
Although the U.S. Senate Special Committee on Aging, initially established in 1961 as a temporary committee, later becoming a permanent Senate Committee in 1977, has no legislative authority, it studies an array of issues related to older Americans. Last week, U.S. Senator Bob Casey (D-PA), Chairman of the U.S. Senate Special Committee on Aging, held a full Committee Hearing, taking a look at an important issue impacting older Americans, the rampant increase of scams and frauds.
The hearing entitled “Fighting Fraud: How Scammers are Stealing from Older Adults,” lasting over one hour and thirty minutes, highlighted the psychological and economic impacts that frauds and scams have older adults, who are disproportionately targeted by fraudsters.
During the hearing, held on Sep. 19, Casey unveiled the Aging Committee’s 9th annual Fraud Book, “Fighting Fraud: Scams to Watch Out For.” The 93-page book, hot off the press, provides seniors with an overview of the most prevalent scams to help them identify and avoid being victimized. The Fraud Book also contains valuable resources for scam victims.
At this hearing, Casey also touched on the 2017 Republican tax law, called “Scammed Then Taxed,”which details how the law’s repeal of the theft loss deduction has imposed significant taxes on many scam victims.
The 91-page Majority Staff Report details the results of a months-long investigation examining how the removal of the casualty and theft loss tax deduction—repealed by Republicans in the 2017 tax law has devastated many American fraud victims.
This report details how some older adults—who lose the most to frauds and scams—are now facing huge tax bills on top of losing all their assets, leading them to feel as though they have been victimized twice.
According to the report, for a century, the theft loss deduction allowed taxpayers who experienced theft to receive a tax deduction to offset their losses. The repeal of this provision has meant that fraud victims are now often obligated to pay taxes on money that has been stolen.
Keeping Scammers from Stealing from Older Adults
In his opening statement, Casey stated: “At today’s hearing, we heard tragic stories from scam victims and law enforcement about how fraudsters are getting more sophisticated and aggressive with their scams and throwing the lives of older adults into chaos.” The Pennsylvania Senator stressed the importance of educating older adults about the threats they face from frauds and scams.
Casey rattled off a list of common scams, detailed in the released Fraud Book, including grandparent scams, investment scams, tech support scams, to name just a few.
With the advent of Artificial Intelligence, scammers have now gotten even more sophisticated, especially by cloning the voice, warned Casey, making their phone and online message even more convincing to the older victim.
“That may explain why recent FBI data shows that fraud losses among older adults have gone up in recent years – reaching $3.4 billion in 2023,” says Casey.
Casey also called for more resources to be provided to persons who have been victimized by scams, including those who have been forced to pay taxes on money they’ve lost due to changes in the 2017 Republican tax law.
Like Casey, in his opening statement Ranking Member Mike Braun (R- Indiana) also stressed the need to prioritize education and outreach to older adults help them to recognize red flags that warn of scams.
“Our community banks and credit unions are often the first line of defense intervening on transactions that just don’t add up,” says Braun. “In my home state of Indiana, one community bank has been able to stop over $1.2 million worth of scams this year,” he notes.
According to Braun, last year Medicare lost an estimated $60 billion due to fraud, errors, and abuse. “Every dollar lost to fraud is a dollar that can be spent on vital programs for American seniors,” he says.
The Indiana Senator noted that he has requested the U.S. Government Accountability Office (GAO) to initiate a full audit of Medicare fraud. The GAO has begun its audit in July, says Braun, noting it to be the most comprehensive audit in Medicare’s history.
And Braun expects the GAO investigation to uncover “how much fraudsters are stealing from the American taxpayer” and to revamp the current Medicare Fraud Prevention System to reduce fraud taking place.
Witnesses testifying before Senate Aging Committee
Casey invited Susan Whittaker, an Administrative Assistant at Lehigh County Aging and Adult Services in Allentown, Pennsylvania, to testify at the hearing about her late husband’s experience as a QuickBooks scam victim. At the time of the scam, Bill, 75, suffered from dementia along with other chronic conditions.
Susan told Senators that her husband had received an email receipt on Tuesday, that appeared to be from QuickBooks. It claimed that a software upgrade fee of $499 had been charged to the business account that Bill used to manage his son’s company. He knew that he hadn’t purchased this upgrade. Calling the company and requesting a refund, he was told to pay $500 upfront, thru a created Venmo account, install an application on his computer and provide personal financial information. Once done, Bill would get his money back.
On Friday, by the time Susan had learned about the financial transaction, $28,000 had been withdrawn from their accounts. Although the bank ultimately recovered $8,000 the following week, $20,000 was gone — money that her husband was planning to use to buy medications. And he lost his job, too.
“This scam was devastating and had a devastating effect on Bill—both financially (losing $20,000) and emotionally,” stated Susan, forcing her husband to begin rationing his medications.
“We just couldn’t afford them [medications] anymore… He also lost his sense of self-worth. I was really sad to see this very intelligent and past business owner, become so afraid to read emails and use a phone. It was a huge setback for him, and I think contributed to his worsening health conditions…he stopped living,” said Susan.
Kathy Stokes, Director of AARP’s Fraud Prevention Program, told Senators that there has been a “meteoric” growth in fraud crimes. When considering fraud that goes unreported, Stokes noted that the Federal Trade Commission estimated the cost of fraud at $137 billion in 2022. But most fraud experts say that this is far higher than the $ 8.9 billion in losses reported that year, she added.
Beyond educating seniors about fraud prevention thru the sharing of information online at aarp.org/fraudwatchnetwork, AARP covers the issue in AARP the Magazine, AARP Bulletin, biweekly emails or text ‘watchdog alert newsletter,” and on its podcast “A Perfect Story,” notes Stokes.
“Beyond education, AARP is unique in its focus on supporting victims of fraud and their families,” says Stokes, noting that its Fraud Watch Network Helpline receives 500 calls a day.
“Addressing fraud requires more than piecemeal solutions; it demands a whole-of-society approach,” warns Stokes. “But together, educators, policymakers, law enforcement and industry can turn the tide against vicious crime gangs who hold the power right now. Together we can disrupt their business model, protect millions of consumers, and keep billions of dollars in saving and retirement accounts and in our economy,” she says.
“Currently, we are all failing the very people who need us the most: older adults- m any of whom can’t afford to lose anything, let everything. We are failing in our most basic duties to protect those in their golden years who are living off their nest eggs they worked for their entire lives and who are beyond the ability to rejoin the workforce to make the money back,” charged Scott Pirrello, who oversees the San Diego District Attorney’s Office’s Elder Abuse Prosecution.
“Too many very well intended programs are not implemented in a way to truly impact the tsunami of fraud that we are facing each day,” he said.
Pirrello told the Senators about the success of the Elder Justice Task Force (EJTF), created by his office, working with the San Diego FBI, to combat elder fraud. Oversea scammers depended on organized networks of money launders operating in the United States, he said, noting that EJTF worked to disrupt these networks.
Like the other witness, Pirrello called for investing in education, as well as adequately fund task forces like the EJTF, to fight against scammers.
One of the biggest crimes affecting Medicare beneficiaries and persons with disabilities is Medicare fraud, waste and abuse, says Nancy Gilmer Moore, who works for the Indiana Association of Area Agencies on Aging managing its Senior Medicare Program. “Health care experts estimate improper Medicare payments are approximately $ 60 billion a year,” she says.
Gilmer Moore admitted to the Senate Aging Panel that she was personally the target of the “Intermittent Urinary Catheter fraud scheme. Medicare paid the fraudsters $1,500 a month (for supplies never ordered) before she noticed it on her statement. Moore ultimately reported the suspicious claims to Centers for Medicare and Medicaid Services and requested a new Medicare number since her number was compromised.
“Be on the lookout for duplicate billing, services or products not rendered or received and services not ordered by their physicians,” urged Gilmer Moore, noting that beneficiaries and caregivers should never give their Medicare number or financial information over the telephone to an unknown called. Medicare does not make. unsolicited phone calls.
For information on fraud prevention, go to aarp.org/fraudwatchnetwork.
To download a copy of the 2024 Fraud Book, go to https://www.aging.senate.gov/imo/media/doc/2024_fraud_book_english.pdf.
To watch the Senate Aging Panel’s hearing on fighting fraud, go to https://www.aging.senate.gov/hearings/fighting-fraud-how-scammers-are-stealing-from-older-adults.
To see the Majority Staff Report, “Scammed Then Taxed,” go to
Herb Weiss 