After a lifetime of hard work, seniors should be able to sit back and enjoy their retirements comfortably. But con artists and disreputable professionals have singled out the elderly as targets for scams and fraud.

A recent story in The Washington Post reported that the SEC has conducted an investigation into seminars and other sales presentations geared to senior audiences. Offering free lunches, salespeople try to lure the seniors into unsuitable investments that often carry high commissions, sales charges, and surrender charges. SEC Chair Christopher Cox called the results of the investigation "deeply disturbing."

Where the money is
It's not hard to understand why crooks go after the elderly: They have money. According to AARP, senior citizens have about $14 trillion in assets. That's a big carrot to dangle in front of dishonest people looking for a fast buck.

But despite their collective wealth, many seniors aren't comfortable managing their money on their own. With memories of the Great Depression and market crashes over the decades, they often steer clear of stocks in favor of more conservative investments, such as FDIC-insured bank CDs and Treasury bonds. Yet because they typically live on fixed incomes, many senior citizens have trouble making ends meet, especially with the relatively low interest rates that have prevailed over the past several years.

Higher income ... at a price
The lure of high-yielding investments is often what tempts these insecure retirees. For example, deferred fixed annuities look a lot like bank CDs to novice investors, and they often pay higher yields than CDs. And even though they're not insured by the FDIC, many insurance companies, including MetLife (NYSE:MET) and Prudential (NYSE:PRU), have been in business for over a century. That fact lends credibility to the idea that fixed annuities are safe.

But some annuities contain restrictions on the money invested in them. You may have to pay a fee if you withdraw money within a certain time after you buy an annuity. And while annuities often pay sizable commissions to agents soon after a sale, salespeople may have to pay back those commissions if customers try to back out quickly. As a result, disreputable agents have every incentive to keep seniors locked in, even if the investment is no longer suitable.

And it's not just annuities. Risky securities like trust deeds and junk bonds offer high monthly income, but the risk of principal loss is substantial. With the financial stresses many seniors face, those bigger monthly checks can seem like an answered prayer -- until they stop coming.

What to do
Unfortunately, insurance companies don't always do the right thing. The Post's story includes the experience of one person who'd bought an annuity from Allianz (NYSE:AZ). The company defended its practices, citing low complaint levels and oversight provisions. Yet large insurance companies employ thousands of salespeople, so it's a huge challenge to supervise them effectively.

As a result, you need to take matters into your own hands. Here are some ideas on how to protect yourself and your loved ones.

  • Never buy anything the first time you meet someone who is trying to sell you something. If you know you're vulnerable to sales presentations, leave your checkbook at home.
  • If you need help with your finances, ask friends and family members for recommendations.
  • If you meet with an advisor, get the names of other clients the advisor has. If the advisor can't give you references, stay away.
  • Always get a second opinion. A reputable professional will understand how important that is.

You've worked a lifetime to save what you have. Don't let financial fraudsters take your money.

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Fool contributor Dan Caplinger has seen too many horror stories involving seniors in his day. He doesn't own shares of companies mentioned in this article. The Fool's disclosure policy doesn't offer free lunch, but it won't try to scam you.