Contributing Writer: John Skelton of Senior Helpers of Tempe
First Published in The Phoenix New Times April 22nd 2022.
With sunny weather year-round, a dry climate, and slow-paced small towns nestled into iconic Southwestern scenery, there’s a reason Arizona is the third-most desirable retirement destination in the country.
In fact, one in four Arizona residents is over the age of 60. Those in their golden years tend to have more gold in the bank than younger people, but that just makes Arizona seniors a plum target for a slew of financial crimes, including extortion and identity theft. A study released this month by NiceRx, an online pharmacy and medical clearinghouse based in the United Kingdom, ranked Arizona ninth in the U.S. among states where elder fraud is most rampant. The study is based on data from a 2020 FBI report on elder fraud.
“Elder abuse is a serious problem,” Arizona Attorney General Mark Brnovich said in a statement. “Older adults may become vulnerable due to isolation, physical or mental disabilities and dependence on others for assistance.” Since 2020, more than 3,000 Arizona residents over the age of 60 have been defrauded out of more than $27 million, according to the NiceRx study. Brnovich suspects that the actual number of victims is as many as 6,900, but that “elderly victims are often reluctant to report abuse because they feel ashamed, embarrassed, humiliated, afraid, and may even defend the abuser.” Three out of four victims of elder abuse in Arizona are white women, like 71-year-old Flora, who was scammed so badly she filed bankruptcy in 2020, and whose full name we are withholding to protect her privacy.
It was just four months before the FBI’s Phoenix Field Office published an official warning regarding the scourge of elder fraud in Arizona. Flora flew from Illinois to Phoenix-Mesa Gateway Airport thinking she was meeting her fiancé. No one showed up at the airport. Instead, the scammers convinced her to empty her bank account at a Walmart register. She was instructed to buy pre-loaded gift cards and send back photos of the 16-digit number embossed in raised lettering on the front of the card, giving scammers access to the balance.
Scammers favor gift cards “because they are easy for people to find and buy, and they have fewer protections for buyers compared to some other payment options,” the Federal Trade Commission said in a December statement. Scammers cash out quickly and anonymously, and the transaction is largely irreversible.
Gift cards can even resell above face value on the secondary market, according to Mountain View, California-based NortonLifeLock, a Fortune 500 cybersecurity company. Flora, who lives near Chicago, was completely broke and stranded in the Phoenix suburb of Gilbert after purchasing the gift cards there. She couldn't even afford one night at a nearby hotel, a police report revealed. “As soon as you provide the gift card number and any sort of security code that's present on the card, the scammer can access those funds,” Gilbert Police Department spokesperson Brenda Carrasco said. “In addition, it’s important to note that scams can also be cyclical such as during holiday and tax seasons.”
The elderly scam victim spent 24 hours inside a Subway restaurant near Power and Ray roads before Gilbert Police Officer Adam Walicke bought her a plane ticket home and drove her to Phoenix Sky Harbor International Airport. Police later determined that the California driver’s license for the no-show fiancé was counterfeit. No such person exists.The usual protocol for a situation like that one would involve transporting the victim to a homeless shelter.“Flora was stuck in Arizona with no means to survive,” Walicke said.
Romance scams rank seventh among the most prevalent crimes against people over 60, claiming about 6,800 victims in the U.S. last year, according to the NiceRx study. However, romance scams are the most costly. Those 6,800 victims doled out more than $281 million last year — an average loss of more than $41,000 per victim. “Playing on the vulnerabilities and even the good nature of the elderly victims, romance scams use personal relationships to secure payments and even fraudulent investments,” the study’s authors wrote. “These relationships may involve the criminal impersonating a loved one or may involve them creating an online persona to win the trust of a victim.” Flora sent her faux beau money consistently for more than a year before flying to Phoenix, according to a Gilbert Police Department investigation report.
“Scammers will create a sense of urgency and indicate there will be consequences if fees are not paid,” Carrasco said. “Victims can be instructed to make several purchases at different stores. Some scammers may keep their victims on the phone while they complete the task.” Fraud cases in Gilbert jumped more than 30 percent from 2019 to 2020, according to police records. Although local cops never determined if the charlatans in Flora's case were operating their scam in metro Phoenix, the U.S. Department of Justice later nabbed a Phoenix woman in a “nationwide grandparent fraud scam.”
In October 2020, the Justice Department vowed to curb the financial exploitation of elderly Arizonans with a $1.5 million injection into two anti-fraud organizations in Tempe and Whiteriver in Navajo County. “With lockdowns in place across the country, older adults are especially vulnerable to fraud, neglect, and abuse, and criminals have not hesitated to take full advantage,” then-Deputy Assistant U.S. Attorney General Katharine Sullivan said in Phoenix at the time. “These grants will help to turn the tide of deception and predation and restore victims to fiscal security and physical safety.”
In August 2021, a federal grand jury indicted eight people, including a Phoenix woman, in a $2 million scam that victimized people over 70 by feeding them phony stories that their grandchildren were in trouble and needed quick cash. “This scheme has left many elderly victims financially and emotionally devastated,” Acting U.S. Attorney Randy Grossman said in a statement. “It is unconscionable to target the elderly and exploit their love for their grandchildren. Elder fraud is a serious crime against some of our nation’s most vulnerable citizens.”
Lyda Harris, from Laveen Village in Phoenix, was arrested last year hiding out in Albania. Federal prosecutors are seeking her extradition back to the United States. Harris is accused in federal district court in Southern California of posing as a distressed grandchild, using a well-rehearsed script to convince victims that she was in dire legal trouble. The scam generated as much as $57,000 per day, according to the indictment. The scammers “took elaborate steps to conceal their true identities from victims and law enforcement,” federal prosecutors said. They used fake names, rented cars and apartments to receive and pick up cash, which they would then convert to untraceable cryptocurrency within minutes, according to the indictment. Harris’ co-defendants would play other actorial roles in the scam, including lawyers, bail agents, and medical workers.
“I know some victims may be reluctant to come forward because they feel embarrassed that they fell for this hoax,” Grossman said. “But I want to assure victims that it is not your fault. You are one of many, many people who were deceived by a sophisticated criminal organization whose members concocted a number of plausible storylines and conspired together to trick you. These are unscrupulous manipulators who prey on the elderly. They are to blame, not you.”
Popular YouTube channels churn out videos where pranksters waste the time of potential scammers and lead them on a series of ludicrous diversions. The increasing popularity of such videos could have had a hand in the increased awareness of fraud and scams, especially those targeting elderly people. In 2021, the term “elder fraud” saw a 32 percent increase in searches, with 6,120 such queries in the U.S. compared to 4,620 in 2020, according to data taken from Google Keywords Planner for the NiceRX study.
Still, elder fraud is up more than 150 percent in Arizona since 2019. More than half of elder fraud victims in Arizona are duped at the hands of trusted family members, friends, and neighbors, according to the Arizona Attorney General’s Office. Authorities agree that educating elderly loved ones is the best way to combat the most pervasive cons — extortion, phishing, and tech support scams.
“We encourage our community members who may have family members at risk of falling for these scams to check in on them routinely,” said Carrasco, the police spokesperson. “Establish a system where they notify a trusted contact immediately should someone ask for their personal and financial information.”
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