Sunday, May 26, 2019
Marketplace recently ran a story about fascinating research on whether there is a correlation between age and susceptibility to scams. Age of fraud: Are seniors more vulnerable to financial scams? opens with the story of one individual who fell victim to a "gift card" scam of almost $200,ooo. Think it can't happen to you? Here is where the science comes in.
[A researcher] and his colleagues have put a label on what they see as an all-too common condition: “age-associated financial vulnerability.”
“We are learning that there are changes in the aging brain, even in the absence of diseases like Alzheimer’s disease or other neurodegenerative illnesses, that may render older adults vulnerable to financial exploitation.”
The science is showing that older folks
ability to detect sketchy situations may decline. Or, we may become prone to seeing the upside of a risky deal and blow off the downside. Some people are more inclined to believe the last person they spoke to. Others may lose the ability to push back on a high-pressure predator. Researchers emphasize that this phenomenon goes way beyond changes in the brain.
“It also involves all of these other social and environmental factors like social isolation, like cultural factors and societal factors, like older adults having more wealth compared to younger generations,” said Marti DeLiema, a research scholar at the Stanford Center on Longevity.
Still think it can't happen to you? The researchers are examining "age-related financial vulnerability[and] are very interested in physical changes to the aging brain, the way eyesight and hearing can get less keen. In some cases, a new pattern of making mistakes with money may be a harbinger of cognitive bad things to come, the “first thing to go,” as it were"
Still think it can't happen to you? Read on. The optimal age for money management is 53 years old, according to the article. There is some advantage to age; the life experiences we acquire. Now we all know, as the article reflects, that scams don't just target older persons. There is no easy answer to the issue. How do you protect people from making bad decisions or from falling for a scam? The article references various state approaches and the federal Elder Abuse Prevention and Prosecution Act. FINRA is also asking brokers to "encourage customers to list the name of a trusted person to contact if something signals “scam.” Banks have no such rule."
The remainder of the article focuses on the responses and need for more work. Several experts offer suggestions for responses. I thought this one response was poignant: "abuse of the elderly is, at its core, lack of social support. The cure is social support. It’s possible that the best way to help vulnerable loved ones is just to be there, to be present in their lives."
Think this can't happen to you? Think again. And read this article.