Tag Archive for: John Sileo

Over 90% of Rachael Ray Show Audience Faces Identity Theft Risks

Recently, I was asked to do a segment for The Rachael Ray Show that demonstrated very visually how many audience members face immediate identity theft risks. Watching them move across the stage as we exposed two or three common sources of identity theft was remarkable. Once we had experienced the numbers, we ventured into the house of one of Rachael’s audience members to see how to mitigate the risk. Watch the video to see if you would have joined the “at risk” group, or read the transcript below:

Rachael: We had the audience stand back here because we all carry several items on any given day, EVERY given day, that put us at risk.  So John, you’re going to weed out our audience so we can all learn in how many areas we are seriously at risk if we have certain items on us, correct?

John: Perfect.

Rachael: Okay, how are we going to get them started?

John: The first one is your Social Security card. If you carry your Social Security card.

Rachael: If you have your actual your Social Security card, I’d like you to cross the room and come to this side of the studio.  (Audience members cross.)  A few people–not many.  I don’t carry mine, either.

John: A few have got it.  A lot of us do it.

Rachael: To me, Social Security numbers- they ask for them everywhere. The bank, the doctor–everywhere.  I know the number.  I don’t carry the card, but it is like your signature.

John: It is.  It’s your net worth.  It’s your future buying power, so a thief with a Social Security number–they can buy a home as you.  That’s what happened in my case.  They purchased a home.  They go bankrupt as you.

Rachael: A house?

John: Yes, she bought a house.  It was a woman.

Rachael: Just like in the movie! That is amazing.  And a woman took your Social Security number and it didn’t even occur to anybody- it’s not a man named John?

John: I know and then went bankrupt-as me.

Rachael: Oh my God–I just want to feed you spaghetti!  Okay, I think we’re going to move a lot of people on this next item.  Tell them the next item.

John: Yes.  If you have a smartphone without a passcode on it.  So without the four digit code or some sort of a passcode.

Rachael: If you have an unprotected phone, move it.  (Many audience members move.)  I knew we’d get a lot of them on that one.  Okay, now explain why you’re even more at risk without a passcode, even though it’s fairly obvious.

John: You bet.  So the smart phone is part of who we are, right?  It’s become an extension of ourselves.  It’s literally part of our identity.

Rachael: Access to everything.

John: Let me give you an example of how easy it is.  The thief takes it off the table at a cafe, right?  They walk outside- no passcode on it.  So they quickly surf through your websites or your contacts.  They see where you bank.  Then they go, ON THAT PHONE, to the bank’s login page and they hit the “forgot my password” link…

Rachael: And it sends it to you!

John: And it emails it to the thief!

Rachael: AGGGHHH!

John: They’re right in your account.  Bam! It’s that easy.

Rachael: One more thing.  We’ve gotta move more people.  Give us one last item that puts us at risk that you think most, if not all, of these people have.

John: If you have a debit card or bank card. (Almost everyone else crosses room.)

Rachael: Now everybody has to have their bank card with them.  I carry mine, too.  Don’t you carry one?

John: I don’t.  I’m not saying you can’t carry a debit card or a bank card.  It’s how you carry it.  It’s that you’re smart with it.  Your debit card, your checkbook, connects directly to your bank account.

Rachael: (Looks at remaining audience members who didn’t move.)  We have about ten/twelve people left.  You guys don’t have any bank or debit cards on you?  Wow, That’s amazing!

John: It’s doable.  Use your credit card.  I realize it’s a great budgeting tool, but if you can get it out of your purse when you don’t need it…lock it up at home- just like you do your Social.

Rachael: Get cash once or twice a week.  Leave the card at home and carry credit cards that have protection.

John: Yes, you have much better protection liability-wise.  The money doesn’t come directly out of your  account when it’s stolen.

Rachael: It’s amazing.  I love the visual of watching the risk factor.

New segment 

Rachael: We wanted to take this a few steps further.  We didn’t have time to go to every single person’s home here, so we sent you to one of our viewer’s homes to find the places in our homes where we’re putting ourselves at even more risk, right?

John: Yes, at Lisa’s.

Rachael: So, he went to Lisa’s house.  We’re going to have these guys take a seat.  You check out what happened at Lisa’s and we’ll meet back here.

Video

(Shows family activities at Lisa’s house.)

Lisa:  I’m a wife and a mother of three and I just want to do everything I can to protect my family.  About a year and a half ago we were victims of identity theft.  You feel like your whole life has been stolen from you. At first when that identity theft happened, we were taking steps.  We put alerts on with credit reporting agencies, but I think I fell back into being more lax about it.

(John arrives at Lisa’s house.)

John:  So our plan of attack today with Lisa is to take her around the house and we’re just going to look at the different ways her data might be exposed.

(In her office)

We’ve got a file cabinet…a locking file cabinet that undoubtedly is …unlocked.   (It is. John looks through items) Birth certificates…

Lisa:  I try to hide it.

John: You try to hide it, yeah, but we all hide it in the same way.  What I really suggest is a locking fire safe.  You can buy these big, heavy safes that protect against water and fire, but they also allow you to store these documents in a really safe way.

(On to Kitchen)

Lisa:  My purse is over here.

John: Wow.  What is this, an organizer?  (Huge, overflowing wallet)  You keep your life in here, don’t you?  Let’s see what we’ve got.  Debit cards, multiple credit cards…I would get in the habit of thinking, “Okay, I’m going out to do this shopping.  What cards do I need?  Take the cards that you use most often and get in the habit of leaving the rest at home.  On a credit card or debit card, one thing that I recommend is that you simply write Photo ID Required on it.  It lets the retailers know, “Hey, my identity matters.  Ask for it.”  It makes it harder for someone to shop and impersonate you. (Continues to look through wallet) Cash-we don’t worry too much about that.  It’s really the data that we’re looking at. And a lot of times the thieves will take the cash, they’ll take photos of this (other cards/data), and they’ll put it all back.  They don’t want you to know they’ve taken it.

Lisa: I didn’t even think of that.

(They head outside to Lisa’s trash can.)

John: You have to be really mindful of what we leave outside of the door.  We put things in our trash that are incredibly valuable.  This is called dumpster diving.   (John looks through trash.) This looks good here.  Looks like a bank statement, we’ve got an insurance statement.  We’ve got a credit card statement.  It has your full account number on it-right there. Bonanza!  You also need to shred anything with any identity on it.

(Moves to mailbox- unlocked out on the street)

Do you mind if I go through your mail a bit?

Lisa: Not at all.

John: Allright, so here’s a pre-approved credit card offer.  This makes it really easy for somebody to apply for a credit card in your name.  There’s an easy solution.  It’s called opting out.  You can opt out of financial junk mail so it’s never in your mailbox in the first place.

Lisa: I didn’t even know you could do it.

John: You should take this now and shred it.  Everything that you can shred, you shred.

(Moves to Lisa’s computer.)

John: I love talking to people about their computers because it is the jackpot in the house of all our financial information.  I was glad to see that you have a password to get in.  That way if somebody walks out with the box, it’s a little more protected.  Do you shop online at all?

Lisa: Yes, I do.  I shop online a lot.  I’ve been using my debit card a lot more lately.

John: Okay, shopping online- I’m totally good with.  Using your debit card is risky.  It’s connected to your bank account.  I recommend you use a credit card and, in fact, I think it’s smart to have a separate credit card you use online and a credit card you use out and about.  That way if something happens online, you can shut down the one card and you’ve kind of cordoned it off.

(Back to studio.  Rachael welcomes Lisa and introduces Privacy Means Profit.)

Rachael: The biggest thing that I got out of that segment that I want to do immediately when the show is over–putting the stickers on every single front of my credit card or debit card (that says) “Ask for Photo ID”.  You said everyone ignores it on the back, but everyone demands it on the front.

John: That’s exactly right.

Rachael: Everyone could buy “stickems” and that’s a really good one.  That’s so easy and fantastic.  So Lisa, that was enlightening. Thank you for letting us into your home.  What did that feel like from your side of it?  Did you feel like “Uh!” (slaps forehead) “I can’t believe I did that”?

Lisa:  I couldn’t believe everything I was doing wrong.  John gave me such great tips- just little things you can do to protect your identity.  It was scary because I thought I was being more diligent than I was.

John:  We all do.

Rachael: That’s the thing. It seems so obvious when he puts a highlighter pen over it.   Then we all say “I do that, I do that, too.”  I love that sticker thing though.  Isn’t that a great tip?

Lisa: Yes.  Actually  I started to implement that.  That was the first thing I did.

Rachael: (To John) So, who are identity thieves?  What are the most popular types of identity thieves?

John: It breaks down into three big categories.  The first is friendly fraud.  It’s the people that we know.  I see these every week.  It happens constantly.  It’s the college roommate who visits who has fallen on hard times so they sneak a check out of the middle of your checkbook.  The second is the local.  This is the person in your neighborhood who is a drug addict, a gambling addict, they need a little extra money and they’re willing to filter through your trash or your mail to get it.  The third, the fastest growing one, is organized crime.  These are international people who have huge resources to hack into very secure databases.  These are not poor databases.

Rachael: They’re really investing in their crime with top quality computer programmers.

John: Absolutely, that’s exactly what they do.

Rachael: So, tell us about medical identity theft.

John: It’s so quickly growing because health insurance is really expensive, right?  Here’s one we see a lot of right now.  They wear a pair of Google Glass glasses that record, or they have an iPhone.  They walk through the emergency room where people are totally stressed out and they’re filling out forms and they’re looking at them.

Rachael: That is so creepy!

John: And listen to this one: photocopiers.  You have your doctor photocopy stuff- that has a hard drive in it and when someone services it…

Rachael: You’re giving me hives!

John: So you photocopy it at home.

Rachael: So how do you protect yourself from it?

John: Number one-those benefits statements that we get? Review them, just like you would your credit card statement.  If something is wrong, you shut it down.  You call them immediately.

Rachael: Pay more attention.

John: Yes, pay more attention.

Rachael: And guard what you’re writing.

John: Yes, they can be snapping photos.  A lot of times what I’ll do is put it on a sticky note and I’ll take it off after.  It doesn’t stay on their records, but it stays in the system.  It’s  a little bit better protection.

John Sileo is an an award-winning author and keynote speaker on identity theft, internet privacy, fraud training & technology defense. John specializes in making security entertaining, so that it works. John is CEO of The Sileo Group, whose clients include the Pentagon, Visa, Homeland Security & Pfizer. John’s body of work includes appearances on 60 Minutes, Rachael Ray, Anderson Cooper & Fox Business. Contact him directly on 800.258.8076.

Biometrics are Like Passwords You Leave EVERYWHERE

Biometrics are like passwords, but worse.

Biometrics are like passwords that you leave everywhere (fingerprints, facial recognition, voice patterns), except that unlike passwords, you can’t change them when they’re lost or stolen. It’s easy to change your password, a bit harder to get a new retina. Like passwords, risk goes up as they are stored globally (in the cloud) versus locally (on a physical device).

In addition to the biometrics mentioned above that most of us have come to accept as commonplace, there are many other methods in use or under exploration:

  • hand geometry
  • vascular pattern recognition (analyzing vein patterns)
  • iris scans
  • DNA
  • signature geometry (not just the look of the signature, but the pen pressure, signature speed, etc.)
  • gait analysis
  • heartbeat signatures

At the 2014 Annual International Consumer Electronics Show, inventors displayed dozens of devices using biometrics, some of which will become just as commonplace as fingerprints in the near future, some of which will not catch on and be replaced by something even more amazing.  Some of the hot biometrics items this year:

  • Tablets that measure pupil ­dilation to determine whether you’re in the mood to watch a horror movie or a comedy.
  • Headbands, socks and bras that analyze brain waves, heart rates and sweat levels to help detect early signs of disease or gauge a wearer’s level of concentration.
  • Cars that recognize their owner’s voice to start engines and direct turns and stops, all hands-free.

(Do a search for “current biometric uses” if you want to be entertained for a while!)

Some less outlandish examples that are currently in place:

  • Barclays Bank in Britain utilizes a voice recognition system when customers call in.
  • Some A.T.M.s in Japan scan the vein pattern in a person’s palm before issuing money
  • World Disney World in Orlando, Fla., uses biometric identification technology to prevent ticket fraud or illegitimate resale as well as to avoid the time-consuming process of photo ID check.
  • Biometric passports contain a microchip with all the biometric information of holders as well as a digital photograph
  • Law enforcement agencies, from local police departments, to national agencies (e.g., the FBI) and international organizations (including Europol and Interpol) use biometrics for the identification of suspects. Evidence on crime scenes, such as fingerprints or closed-circuit camera footage, are compared against the organization’s database in search of a match.
  • Child care centers are increasingly requiring parents to use biometric identification when entering the facility to pick up their child.
  • And, of course, the most popular example has to be the use of fingerprint sensors on the iPhone to unlock the devices.  It will also increasingly be linked to mobile payment services.

So, the million-dollar question is: Are Biometrics a Better Way to Protect Your Personal Identification?

The answer is yes…and no.

  • Biometrics are hard to forge: it’s hard to put a false fingerprint on your finger, or make your iris look like someone else’s.

BUT…

some biometrics are easy to steal.  Biometrics are unique identifiers, but they are not secrets. You leave your fingerprints on everything you touch, and your iris patterns can be observed anywhere you look.  If a biometric identifier is stolen, it can be very difficult to restore.  It’s not as if someone can issue you a new thumbprint as easily as resetting a new password or replacing a passport. Remember, even the most complex biometric is still stored as ones and zeros in a database (and is therefore imminently hackable). 

  • A biometric identifier creates an extra level of security above and beyond a password

BUT…

if they are used across many different systems (medical records, starting your car, getting into your child’s day care center), it actually decreases your level of security.

  • Biometrics are unique to you

BUT…

they are not fool-proof.  Imagine the frustration of being barred by a fingerprint mismatch from access to your smartphone or bank account.  Anil K. Jain, a professor and expert in biometrics at Michigan State University  says (emphasis mine), “Consumers shouldn’t expect that biometric technologies will work flawlessly… There could and will be situations where a person may be rejected or confused with someone else and there may be occasions when the device doesn’t recognize people and won’t let them in.”

The scariest part of the biometrics trend is how and where the data is stored.  If it is device specific (i.e. your fingerprint data is only on your iPhone), it’s not so bad.  But if the information is stored on a central server and unauthorized parties gain access to it, that’s where the risk increases.  A 2010 report from the National Research Council concluded that such systems are “inherently fallible” because they identify people within certain degrees of certainty and because biological markers are relatively easy to copy.

I also feel compelled to mention the inherently intrusive nature of biometrics.  While it’s true that using facial-recognition software can help law enforcement agencies spot and track dangerous criminals, we must remember that the same technology can just as easily be misused to target those who protest against the government or participate in controversial groups.  Facebook already uses facial recognition software to determine whether photos that users upload to the site contain the images of their friends.  Retailers could use such systems to snoop on their customers’ shopping behavior (much like they do when we shop online already) so that they could later target specific ads and offers to those customers.

How long before we have truly entered into Tom Cruises’s Minority Report world where we are recognized everywhere we go?   “Hello Mr. Yakamoto and welcome back to the GAP…”

John Sileo is an an award-winning author and keynote speaker on identity theft, internet privacy, fraud training & technology defense. John specializes in making security entertaining, so that it works. John is CEO of The Sileo Group, whose clients include the Pentagon, Visa, Homeland Security & Pfizer. John’s body of work includes appearances on 60 Minutes, Rachael Ray, Anderson Cooper & Fox Business. Contact him directly on 800.258.8076.

Identity Theft Expert John Sileo on The Rachael Ray Show

John Sileo appeared on CBS’s The Rachael Ray Show on January 29, 2014 to talk about the latest identity theft trends and threats.

Rachael asked John to go into one of their audience members homes and pick it apart from a privacy standpoint. John took a look at everything, from items hidden under the mattress to filing cabinets, trash cans, computers, mobile devices and more. Take a look to learn how to bulletproof your home and self against identity theft.

John Sileo is an an award-winning author and keynote speaker on identity theft, internet privacy, fraud training & technology defense. John specializes in making security entertaining, so that it works. John is CEO of The Sileo Group, whose clients include the Pentagon, Visa, Homeland Security & Pfizer. John’s body of work includes appearances on 60 Minutes, Rachael Ray, Anderson Cooper & Fox Business. Contact him directly on 800.258.8076.

Data Security Expert John Sileo on Fox Business (Target Data Breach)

Data Security Expert John Sileo talks with Fox Business about the recent Target data breach.

 

Data Breach Expert John Sileo on Fox & Friends – Target Data Breach

Data Breach Expert John Sileo goes on Fox & Friends to discuss the 110 million records breached at Target.

Do Fitness Apps Share Your Health w/ Others (Insurance Co’s)?

Is your health and fitness app sharing your health score with your insurance company? Do health apps pose privacy risks?

I recently had the opportunity to attend a very informative webinar presented by the Privacy Rights Clearinghouse entitled “Mobile Health and Fitness Apps: What Are the Privacy Risks?”

It was based on a nine-month study on privacy apps that many individuals use to monitor their health, learn about specific medical conditions, and help them achieve personal fitness goals.   Such apps may include those that support diet and exercise programs; pregnancy trackers; behavioral and mental health coaches; symptom checkers that can link users to local health services; sleep and relaxation aids; and personal disease or chronic condition managers.

These apps appeal to a wide range of consumers because they can be beneficial, convenient, and are often free to use.  However, it is clear that there are considerable privacy risks for users – and that the privacy policies (for those apps that have policies) do not describe those risks.

The most common way that these apps invade your privacy is through connecting to third-party sites and services (imagine having your health score shared with insurance companies!).  The idea that these sites do so without informing users seems to be the norm, not the exception.  In fact, more than 75% of free apps and 45% of paid apps use behavioral tracking, often through multiple third-party analytics tools.

Here are some of the key findings of the report:

  • Many apps send data in the clear – unencrypted – without user knowledge.
  • Many apps connect to several third-party sites without user knowledge.
  • Unencrypted connections potentially expose sensitive and embarrassing data to everyone on a network.
  • 72% of the apps assessed presented medium to high risk regarding personal privacy.
  • The apps that presented the lowest privacy risk to users were paid apps.  This is primarily due to the fact that they don’t rely solely on advertising to make money, which means the data is less likely to be available to other parties.

Advice for consumers when using fitness or health apps:

  • Research the app before you download it.
  • Consider using paid apps over free apps if they offer better privacy protections.
  • Make your own assessment of the app’s intrusiveness based on the personal information it asks for in order to use the app.
  • Assume any information you provide to an app may be distributed to the developer, third-party sites the developer uses for functionality, and unidentified third-party marketers and advertisers.
  • Try to limit the personal information you provide, and exercise caution when you share it.  If the app allows it, try the features first without entering personal information.
  • Ask a tech savvy friend to help you determine what information an app is asking for, help you navigate settings, and potentially help you restrict the information an app gathers.
  • If you stop using an app, delete it.  If you have the option, also delete your personal profile and any data archive you’ve created while using the app.

I would hope that mobile app developers would create products with privacy in mind and implement responsible information privacy and security practices.   Until that time, users should assume that everything in an app is sent to the developer and possibly many unidentified third parties, so should only use apps and provide information they feel comfortable sharing.

John Sileo is an author and highly engaging speaker on internet privacy, identity theft and technology security. He is CEO of The Sileo Group, which helps organizations to protect the privacy that drives their profitability. His recent engagements include presentations at The Pentagon, Visa, Homeland Security and Northrop Grumman as well as media appearances on 60 Minutes, Anderson Cooper and Fox Business. Contact him directly on 800.258.8076.

10 Times NOT To Use Your Debit Cards this Holiday Season!

As you head into the holiday season, one of the best steps you can take to protect your bank account is to eliminate the use of your debit card. While delivering a keynote speech in Washington DC last week, someone asked me if I could name ten times when you should NOT use a debit card.  I replied, “It’s a trick question because the answer is NEVER!” I seriously do feel that way, but I know there are people who either need to or prefer to use a debit card rather than a credit card or cash, so I want you to be informed about how to use it wisely.

First, make sure you understand the difference between a credit and debit card.  While they appear identical and can often be used interchangeably, remember that a debit card is a direct line to your bank account.  If a thief gets ahold of your debit card information, they essentially have access to your account.  One of the biggest differences comes to light when fraud occurs.  Credit card users can simply decline the charges and not pay the bill.  Debit card fraud comes straight out of your bank account and is much harder to fight or reclaim the money that as been debited. In the meantime, while you prove it was fraud, you’re out the cash.

Here is a Top Ten List of times to choose credit over debit.

10. Booking future travel

If you book your travel with a debit card, they debit your account immediately,. So if you’re buying travel or making a reservation that you won’t use for several months, you’ll be out the money immediately.  Also consider that many large hotels have suffered data breaches.

9. Hotels

Many hotels follow the practice of using your debit card to place a hold on your money (sometimes hundreds of dollars) to make sure you don’t run up a long distance bill, empty the mini bar or trash the room. The practice is almost unnoticeable if you’re using credit, but can be problematic if you’re using a debit card and have just enough in the account to cover what you need.  Be sure to ask about their “holding” policy if you are using a debit card.

8. Expensive purchases

This one is simple.  If something goes wrong with the merchandise or the purchase, a credit card offers rights to dispute and stop payments much easier than a debit card. You have a much shorter window for reporting and resolving an issue and may even be responsible for all charges if you wait too long.

7. Rental or security deposits.

Say you want to rent a car or borrow a Bobcat from your local home improvement store.  Remember that when you use a debit card to put down a deposit, that money is temporarily unavailable to you.  Of course, you’ll get the money back when you return the car or equipment, so this is no big deal if you have the money to spare until that time. But with a credit card, the money is just “frozen” and not actually charged so you won’t ever notice it’s gone.

6. Regular/recurring payments

You’ve heard about someone who quit a gym or discontinued a magazine subscription only to find that they kept getting billed. If you used a debit card for those payments, they’ll just keep coming right out of your bank account.  (Using a credit card is also a good way to ensure you don’t forget to make that monthly debit in your check register!)

5. Wi-Fi hot spots

Never use your debit card for an online purchase while at a coffee shop or other business that offers free wi-fi access.  Many of those businesses have unsecured wireless connections, so it’s much easier for hackers and scammers to log on and steal your data.

4. Restaurants

Anytime the card leaves your sight, you should NOT use your debit card. The waiter coming to your table has alone time with your card, giving them the opportunity to copy your card information.

This also applies to ordering food for delivery.  Restaurants that deliver tend to keep customer payment information on file in order to make future orders more convenient.

Another problem with using a debit card at restaurants is that some establishments will approve the card for more than your purchase amount because, presumably, you intend to leave a tip. So the amount of money frozen for the transaction could be quite a bit more than the amount of your tab. And it could be a few days before you get the cash back in your account.

3. Outdoor ATMs

Outdoor ATM machines provide the perfect opportunity for thieves to skim users’ debit cards.  Skimming is the practice of capturing a bank customer’s card information by running it through a machine that reads the card’s magnetic strip. Criminals place these machines over the real card slots at ATMs and other card terminals.  If the public has access to it, so do data criminals.  Use the ATM just inside the bank where it is under constant surveillance. And no matter what, look for devices or cameras on the ATM machine that aren’t normally there.

2. Gas stations

Every gas pump asks, “Credit or Debit?” these days.  Don’t choose the debit option!  Go inside and pay cash if you choose not to use your credit card!  There are three reasons.  One, it’s fairly easy for a thief to insert a skimmer and then sit nearby with a laptop accessing your information.  Even if the thief doesn’t manage to get your debit card personal identification number, or PIN, from such a device, he still may be able to duplicate the card’s magnetic strip and use it for “sign and swipe” Visa or MasterCard transactions.

Thieves can also sit nearby using small cameras to capture footage of debit card users entering their PINs. Finally, similar to the hotel example above, your debit card may be used to place a hold for an amount larger than your actual purchase.   So, even though you only bought $10 in gas, you could have a temporary bank hold for $50 to $100, says Susan Tiffany, director of consumer periodicals for the Credit Union National Association.

1. Online

Using you debit card online is like asking for your bank account to be emptied. There is just way too much potential for hacking at many different points in a transaction.  It could occur due to malware on the computer, someone could be “eavesdropping” via a wireless network, or it could happen once in the hands of the merchant due to a data breach.  If you have a problem with the purchase or your debit card number is stolen, it’s a huge hassle to get the money restored to your account and make your card number safe and secure again.

Keep it simple and just always use a credit card. I realize that it is easier to spend more money when it’s not coming directly out of your account, but it’s better to resist the temptation to spend for the added security provided. 

John Sileo is an author and highly engaging keynote speaker on internet privacy, identity theft and technology security. He is CEO of The Sileo Group, which helps organizations to protect the privacy that drives their profitability. His recent engagements include presentations at The Pentagon, Visa, Homeland Security and Northrop Grumman as well as media appearances on 60 Minutes, Anderson Cooper and Fox Business. Contact him directly on 800.258.8076.

Elder Fraud Expert Answers: How do I prevent & resolve it?

The past two blogs have outlined why seniors are targeted, what signs to watch for, and some common schemes.  Now for the truly important info: How to prevent elder fraud from happening and what to do if it does happen!

  • Report actual or attempted elder fraud (or any type of fraud) via Fraud.org’s Online Complaint Form.
  • Change the phone number if a senior is receiving excessive sales calls.
  • Change the bank account or credit card numbers if they have fallen into the hands of thieves.
  • Avoid getting on sucker lists. Don’t fill out contest entry forms at fairs or malls—they are a common source of “leads” for con artists. Ask companies you do business with not to share your personal information with other marketers.
  • Know your “Do-Not-Call” rights. Under federal law, you can tell a telemarketer not to call you again and you can file a complaint on the Do Not Call website.
  • Make sure you know the company you are dealing with. If it’s an unfamiliar company or charity, check it out with your state or local consumer protection agency and the Better Business Bureau.
  • Screen your calls. Use an answering machine, Caller ID, or other services that may be available from your phone company to help you determine who you want to talk to and who you want to avoid.
  • Never sign blank insurance claim forms.
  • Never give blanket authorization to a medical provider to bill for services rendered.
  • Ask your medical providers what they will charge and what you will be expected to pay out-of-pocket.  Get it in writing.
  • Carefully review your insurer’s explanation of the benefits statement. Get an annual “Benefits Request Checkup” from your insurance provider to see a list of all benefits and services paid in your name.  Call your insurer and provider if you have questions.
  • Do not do business with door-to-door or telephone salespeople who tell you that services of medical equipment are free.
  • Give your insurance/Medicare identification only to those who have provided you with medical services.
  • Keep accurate records of all health care appointments.
  • Use caution when purchasing drugs on the Internet. Do not purchase medications from unlicensed online distributors or those who sell medications without a prescription. Reputable online pharmacies will have a seal of approval called the Verified Internet Pharmacy Practice Site (VIPPS), provided by the Association of Boards of Pharmacy in the United States.
  • Always ask for and wait until you receive written material about any offer or charity. If you get brochures about costly investments, ask someone whose financial advice you trust to review them.  Remember, even a classy brochure can be a hoax!
  • Always take your time making a decision. Legitimate companies won’t pressure you to make a snap decision.
  • Don’t pay for a “free prize.” If a caller tells you the payment is for taxes or shipping fees, he or she is violating federal law.
  • Never send money or give out personal information such as credit card numbers and expiration dates, bank account numbers, dates of birth, or social security numbers to unfamiliar companies or unknown persons.
  • Get a second opinion!  When filling out important forms or making a big financial decision, ask someone you trust to look it over and talk it over before giving away any personal information.
  • Get help when using the internet, especially concerning financial transactions.  NEVER give out personal information such as SS numbers or credit card information. Remember that older grandkids make great resources when it comes to using the Internet because they are true digital natives.

Remember, you’ve worked hard to reach a point where you can enjoy your golden years.  Don’t let someone else enjoy the fruits of your labor.  Be vigilant and be protected!

John Sileo is an author and highly engaging speaker on business fraud, internet privacy, identity theft and technology security. He is CEO of The Sileo Group, which helps organizations to protect the privacy that drives their profitability. His recent engagements include presentations at The Pentagon, Visa, Homeland Security and Northrop Grumman as well as media appearances on 60 Minutes, Anderson Cooper and Fox Business. Contact him directly on 800.258.8076.

Elder Fraud Expert Answers: What are the Most Common Schemes?

In our previous blog we talked about why senior citizens have become such a target for con artists and even unscrupulous relatives to commit elder fraud and take their hard-earned money.   We also talked about signs that they may be being duped.  Today, we want to make you aware of the variety of schemes that are out there.  This is by no means a complete list, but will give you a pretty good idea of what to watch for.

Common schemes:

  • The “Grandparents Scam”: someone phones or e-mails and pretends to be a grandchild in trouble. The elderly person, who may not have much contact with their grandchild, might be convinced and may wire money or send a prepaid debit card to help.
  • Offers of “freebies”: the Better Business Bureau of eastern Michigan reports that scammers now are offering seniors $3,000 in “free groceries savings certificates” along with a free medical alert bracelet. The scam may lure people to give away bank account information.
  • Enticing links on websites lure inexperienced seniors into divulging personal information.
  • Con artists may attend the funeral service of a stranger claiming that the deceased had an outstanding debt with them.
  • Reverse mortgage scams: the FBI reports that victims are offered free homes, investment opportunities and foreclosure or refinance assistance.
  • Thieves steal personal information and contact the Social Security Administration to change the payment routing information to the thieves’ own bank accounts or prepaid debit cards.
  • Fake lottery/sweepstakes: seniors are enticed into buying inexpensive knick-knacks or magazine subscriptions (which they do receive) in order to be entered into a contest.  Another variety is they receive an official looking check saying they’ve won a foreign lottery.  In both cases, they are asked to give up personal information to proceed.
  • The discount prescription scam: seniors are offered prescription drugs at a significant discount, but are required to pay a $200 membership fee or give up their credit card information.
  • The “credit card company” calls:  a polite caller says he’s from the senior’s credit card company and is investigating a possible fraudulent purchase. He even IDs the last four digits of the charge card as proof. When the senior denies making the purchase, the caller offers to reverse it immediately, but asks for the verification code on the back of the credit card.
  • Door-to-door solicitors ask for donations on behalf of charitable organizations.
  • Telemarketing fraud: according to the National Consumers League, nearly a third of all victims are age 60 or older. Studies by AARP show that most older telemarketing fraud victims don’t realize that the voice on the phone could belong to someone who is trying to steal their money.
  • Medical Equipment Fraud: equipment manufacturers offer “free” products, such as wheelchairs or oxygen tanks, to individuals. Insurers are then charged for products that were not needed and/or may not have been delivered.
  • “Rolling Lab” Schemes: unnecessary and sometimes fake tests are given to individuals at health clubs, retirement homes, or shopping malls and billed to insurance companies or Medicare.
  • Services Not Performed: Customers or providers bill insurers for services never rendered by changing bills or submitting fake ones.

This list truly only scratches the surface of what is out there, but it gives you a good idea of just how vigilant seniors and their caretakers need to be.  In our next blog, we will provide a list of what seniors need to do to prevent becoming a victim of scams and what to do if it does happen to them.

John Sileo is an author and highly engaging speaker on fraud, internet privacy, identity theft and technology security. He is CEO of The Sileo Group, which helps organizations to protect the privacy that drives their profitability. His recent engagements include presentations at The Pentagon, Visa, Homeland Security and Northrop Grumman as well as media appearances on 60 Minutes, Anderson Cooper and Fox Business. Contact him directly on 800.258.8076.

Elder Fraud Expert Answers: Why Are Senior Citizens Targeted?

 

Imagine spending your whole life working hard, saving wisely and spending conscientiously—only to have your comfy “nest egg” taken away by unscrupulous scammers or even your own greedy relatives in your golden years.  Sad to say, this is a scenario that is far too common; up to 80% of scam victims are over 65, according to the U.S. Federal Trade Commission. A 2009 study by MetLife’s Mature Market Institute estimates that seniors lose approximately $2.6 billion per year to elder fraud, or what they call financial abuse, meaning fraud by outside scammers or theft by family members and acquaintances.

And this issue will take on even more importance in the years to come as the senior population in America grows.  According to the U.S. Census Bureau, there were 37.3 million people 65 and older in the United States as of 2006.  This group is expected to double in size within the next 25 years. By 2030, almost 1-out-of-5 Americans – some 72 million people- will be 65 years or older.

A scan of recent alerts from the Senior Journal shows a wide variety of areas that require constant vigilance:

By definition, Elder Fraud targets seniors, but why?

  • Senior citizens are most likely to have significant savings, to own their home and/or to have excellent credit—all very desirable to criminals.
  • People who grew up in the 1930s, 1940s, and 1950s were generally raised to be polite and trusting.  They are less likely to be suspicious of a nice salesperson, say no or hang up on pushy telemarketers.  There is even a study showing that we get more trusting as we age.  Through MRI testing, researchers at  the University of California, Los Angeles found that the area known as the anterior insula, which is associated with “gut feelings,” became more active in the younger subjects at the sight of an untrustworthy face. Older subjects, however, showed little to no activation in this area.
  • Seniors can be less comfortable with technology and inadvertently share information online or click on links that makes them vulnerable.
  • Criminals know that seniors are less likely to report a fraud.  This could be either because they don’t know who to report it to, are too ashamed at having been scammed, or don’t even know they have been scammed. Many are afraid to appear as if they have lost the ability to make sound decisions to their relatives, so they just keep it to themselves.
  • If an elderly victim does report the crime, scammers know that they often make poor witnesses.   The effect of age on memory combined with the amount of time that often passes between the crime, the realization, and actually acting on it makes it difficult for elderly victims to supply enough detailed information to investigators.
  • Senior citizens are more interested in and susceptible to products promising all sorts of wonderful results, from anti-aging creams to improved memory to medical cures.  In a world full of the miracles they’ve witnessed in their lifetimes, nothing seems too good to be true.  And if they can get a bargain on it, so much the better!

Elder Fraud Warning Signs:

  • You notice an excess amount of ATM or bank account withdrawals, perhaps even exceeding the daily maximum allowed on that account.
  • The senior is bouncing checks, which might indicate an unexpected loss of money.
  • There are debit transactions that don’t seem to make sense for an older adult.  Also, there may be debits that the person can’t remember or explain.
  • The older adult may be suddenly wiring large sums of money or writing large checks.
  • He or she may close a certificate of deposit, even though a large penalty would be paid for early withdrawal before that CD matured.
  • The bank is unable to speak directly with the older adult, despite repeated attempts to contact him or her.
  • A “new friend” suddenly begins handling the money for a senior.
  • The senior receives excessive amounts of junk mail.  (Once a senior takes the bait for one scam, thieves sell the person’s name, address and telephone number, and fake mailings proliferate.)
  • The phone rings excessively with sales calls.
  • He or she may be having difficulty buying groceries and paying bills.
  • They seem to receive lots of cheap items such as costume jewelry, beauty products, water filters, and knick-knacks that they bought to win something or received as prizes.

Tomorrow, we will outline common schemes that are used to prey on senior citizens.

John Sileo is an author and highly engaging speaker on fraud, internet privacy, identity theft and technology security. He is CEO of The Sileo Group, which helps organizations to protect the privacy that drives their profitability. His recent engagements include presentations at The Pentagon, Visa, Homeland Security and Northrop Grumman as well as media appearances on 60 Minutes, Anderson Cooper and Fox Business. Contact him directly on 800.258.8076.