The FTC and the ‘grandparent scam’

The Jefferson couple who lost more than $34,000 in the “grandparent” scam were part of a growing number of people who are tricked into sending cash. Their loss, though, was much greater than most. (See the Police Blotter entry for March 4.)

The Federal Trade Commission in December reported a striking increase in the median dollar amount people age 70 and older reported losing to fraud, particularly funds sent as cash.

According to the FTC, persons who lose money to family and friend imposter scams, often referred to as the “grandparent scam,” reported having sent cash in 25 percent of the cases. People from all age groups reported median losses of about $2,000 to family and friend imposters. Statistics for persons age 70 and older who sent cash are much worse. They reported median individual losses of $9,000.

In the Jefferson case, the couple sent two cash payments totaling $30,200. Jefferson police chief Mark Clouse said the money was sent to empty addresses, with an alert from the Postal Service after it was delivered. In that situation, the scammer then goes and picks up her or her mail after receiving notification of delivery.

Clouse called it a “sickening situation.”

In total, losses to family and friend imposter scams increased from $26 million in the 12 months ending Oct. 31, 2017, to $41 million in the 12 months ending Oct. 31, 2018.

Family and friend imposter scams usually start with a phone call. In half the cases involving cash payments, the caller claimed to be in jail or in legal trouble, or to have been in a car accident. The callers play on their potential victim’s emotions. The often claim the victim is the only person he or she trusts enough to ask for help, and they often ask that the situation be kept confidential.

People claiming to have been in a car accident claim to have broken noses or they sob uncontrollably to cover for an unfamiliar voice. They use personal details gleaned from social media to make their stories believable. They may give specific instructions about how to mail cash, such as placing bills in envelopes in between the pages of a magazine. They ask to have the cash sent via UPS, FedEx, or even the U.S. Postal Service.

The FTC offers easy tips to avoid being scammed:

• Don’t act right away, no matter how dramatic the story is.
• Call that family member or friend, and make sure you use a phone number that you know is right. Or check it out with someone else in your circle, even if the caller told you to keep it a secret.
• Be careful about what you post on social media. If your personal details are public, someone can use them to defraud you and people who care about you.

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