Elder Fraud and Financial Abuse Statistics for 2022

Although scammers will go after anyone, they often target elderly victims with fixed incomes. Classified as elder fraud, this is a rapidly growing crime. Reported losses more than doubled from 2019 to 2021, when they reached almost $1.7 billion, according to the annual Elder Fraud Report from the Federal Bureau of Investigation (FBI).

Elder fraud comes in many forms, from romance scams to impersonations of tech support representatives of well-known brands. They can also have a massive financial impact, with some types of scams costing victims more than $50,000 on average.

Which types of elder scams are most common, and which take the greatest financial toll? Read on for the most recent elder fraud and financial abuse statistics.

Key points

• There were 92,371 victims of elder fraud in 2021.
• Elder fraud losses increased by 391.9% ($343 million to $1.685 billion) from 2017 to 2021.
• Confidence fraud, which includes romance scams, was the most costly type of elder fraud, with $432 million in total losses.
• Tech support scams resulted in 13,900 victims, more than any other type of elder fraud.
• Although data is scarce on elder financial abuse, annual loss estimates range from $2.9 billion to $36.5 billion.

What is elder fraud?

Elder fraud is fraud targeting an elderly victim, which is defined as adults aged 60 and older. These financial crimes can be perpetrated by a stranger or someone close to the victim, such as a family member or caregiver. Senior citizens are frequent targets of fraud for several reasons:

• They've had more time to build wealth than younger adults and could have substantial assets, such as properties, savings, and retirement accounts.
• Some are more vulnerable due to the effects of aging and health issues.
• Some live alone and are more trusting in strangers due to loneliness.
• They may not want to report fraud because of embarrassment, or because they fear being considered unable to manage their own finances.

Elder fraud statistics

There were 92,371 victims of elder fraud in 2021, according to the FBI report. That's a 12.3% decrease from the number of victims in 2020.

However, 2021 fraud losses totaled $1,685,017,829, which is an increase of 74.4% from 2020. The average loss per victim was $18,246, and there were 3,133 victims who lost more than $100,000.

The Federal Trade Commission (FTC) also tracks fraud and identity theft reports in its annual Consumer Sentinel Network Data Book. It found that the percentage of fraud victims reporting losses decreased by each age group, but the median loss was much higher with elderly victims.

Note that the median losses according to the FTC data are much lower than the average elder fraud loss in the FBI data. These are two separate sets of data from different government agencies, so it makes sense that the numbers vary.

Median numbers can also be much lower than the average if there are large outliers in play. The relatively small number of elder fraud victims who lost more than $100,000 very likely brought up the average.

Elder fraud by year

The number of elder fraud victims had been on the rise and jumped by 54.8% in 2020, although it came down in 2021. Losses, on the other hand, have been rapidly climbing every year. From 2017 to 2021, losses were up by 391.9%.

Types of elder fraud

There are many types of elder fraud. Although tech support scams are the ones most often reported, with 13,900 victims, confidence fraud and romance scams cost victims the most overall. The table below includes data on the types of elder fraud that resulted in the largest losses.

Let's take a closer look at how some of these scams work.

Confidence fraud and romance scams

Confidence fraud encompasses scams intended to pull on the victim's heartstrings. One of the most common types is the romance scam, when a criminal creates a fake identity to gain a close relationship with the victim. Once that relationship has been established, the criminal manipulates the victim for money.

Elderly victims have been losing more and more money to confidence fraud. Here are the latest numbers on this growing crime:

• The average loss is $56,422.
• Losses grew by 84.8% ($233.8 million to about $432 million) from 2019 to 2021.
• The victim count grew by 30.4% (5,871 to 7,658) over that same time period.

Grandparent scams also fall under the category of confidence fraud. In this type of scam, the criminal impersonates a younger relative of the victim, claims to be in trouble, and asks them for money. There were more than 450 reports of grandparent scams from elderly victims in 2021, with approximate losses of $6.5 million.

Investment

Investment fraud is the illegal sale or purported sale of financial instruments; pyramid schemes and Ponzi schemes are two examples. This type of fraud often involves guarantees of generous returns with little or no risk. Here's how investment fraud has impacted elderly victims in recent years:

• The average loss is $113,819, the highest of any type of elder fraud.
• Losses grew by 202.7% ($79 million to about $239.5 million) from 2019 to 2021.
• The victim count grew by 243.8% (612 to 2,104) over that same period.

Tech support

Tech support fraud involves scammers impersonating customer support representatives of well-known tech companies. The scammer then offers to fix non-existent technical issues for the victim. There are several ways scammers take advantage of this situation, including gaining remote access to the victim's devices or convincing the victim to send them money.

Senior citizens are a frequent target of this type of fraud. Elderly victims account for 58% of total tech support fraud reports and 68% of total losses. Here's how the numbers have grown over the past three years:

• The average loss is $17,117.
• Losses grew by 519.4% (nearly $38.5 million to about $238 million) from 2019 to 2021.
• The victim count grew by 105% (6,781 to 13,900) over that same time period.

Lottery/sweepstakes/inheritance fraud

Lottery, sweepstakes, and inheritance fraud are all variations on the same concept. The scammer contacts the victim, possibly by phone call, email, mail, or social media. They inform the victim that they've won a lottery or sweepstakes, or that a distant relative has left them an inheritance. To claim the supposed prize/inheritance, the victim needs to pay taxes and fees up front.

This type of elder fraud has fluctuated quite a bit in recent years. The number of victims was up in 2020 and then fell in 2021. Losses, however, have steadily increased. Here's the breakdown:

• The average loss is $20,544.
• Losses grew by 49.8% (nearly $35.8 million to about $53.5 million) from 2019 to 2020.
• The victim count decreased by 5.7% (2,764 to 2,607) over that same time period.

What is elder financial abuse?

Elder financial abuse covers a wide range of abusive conduct designed to extract a monetary or material gain from an elderly victim.

There's no uniform definition of elder financial abuse because it's considered a state and not a federal concern. Most states include financial abuse in their elder abuse laws, but the exact definition varies from state to state.

For example, some states only consider it elder financial abuse if the perpetrator uses dishonest tactics to take advantage of the victim. In these states, the definitions of elder fraud and elder financial abuse overlap quite a bit. In other states, elder financial abuse includes any situation where the perpetrator knew or should have known that the victim lacked the cognitive capacity to make financial decisions, regardless of whether they used dishonest or fraudulent tactics.

Elder financial abuse statistics

Because elder financial abuse doesn't have a firm definition, data on it is scarce. However, the research there has been indicates that this type of abuse happens frequently and has a massive financial impact.

A 2011 study of elder adults in New York compared self-reported financial abuse to documented cases of financial abuse. Financial abuse was self-reported at a rate of 42.1 out of 1,000 participants (4.21%). The documented rate was just 0.96 per 1,000 people (0.096%).

Estimates of annual losses due to elder financial abuse have ranged from $2.9 billion to $36.5 billion. The wide range is due in part to inconsistent definitions of elder financial abuse and also because so many incidents go unreported.

What to do about elder fraud and financial abuse

Unfortunately, there's no simple solution to elder fraud. Social isolation and loneliness are two significant risk factors, so older adults who regularly talk with friends and family are less likely to be victims. But elder financial abuse is often perpetrated by someone close to the victim, such as a family member or caregiver.

Here are some methods the American Association of Retired Persons (AARP) recommends to prevent elder financial exploitation:

• Designate someone you trust as your financial power of attorney. It's important for older adults to do this while they're still able to make financial decisions in case they later become incapacitated.
• Appoint a trusted contact for accounts and investments. This is a person you authorize your bank to contact about questionable activity on your account.
• Sign up for a service that tracks your bank accounts, investments, and credit cards. These services monitor your accounts for suspicious activity, including missing deposits or unusual withdrawals.

If you have a case of suspected or confirmed elder fraud, call the National Elder Fraud Hotline at 1-833-372-8311. This toll-free hotline is managed by the Office for Victims of Crime, a program within the U.S. Department of Justice. It provides services to adults aged 60 and older who may be victims of financial fraud.

It's sad to see the growing numbers of elder fraud and financial abuse. On a positive note, these issues are getting much more attention than they have in past years, and there are resources such as the National Elder Fraud Hotline available to help. Hopefully, this increased attention will result in higher reporting rates and more protection for seniors.

Sources

• American Association of Retired Persons (2022). "5 Ways to Prevent Elder Financial Exploitation."
• Consumer Financial Protection Bureau (2019). "Suspicious Activity Reports on Elder Financial Exploitation: Issues and Trends."
• Federal Bureau of Investigation (2018). "2017 Internet Crime Report."
• Federal Bureau of Investigation (2019). "2018 Internet Crime Report."
• Federal Bureau of Investigation (2020). "2019 Internet Crime Report."
• Federal Bureau of Investigation (2021). "2020 Internet Crime Report."
• Federal Bureau of Investigation (2022). "2021 Internet Crime Report."
• Federal Bureau of Investigation (2022). "Elder Fraud Report 2021."
• Federal Trade Commission (2022). "Consumer Sentinel Network Data Book 2021."
• National Research Council (US) Panel to Review Risk and Prevalence of Elder Abuse and Neglect (2003). Elder Mistreatment: Abuse, Neglect, and Exploitation in an Aging America.
• New York State Office of Children and Family Services (2011). "Under the Radar: New York State Elder Abuse Prevalence Study."