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Welcome to Money Smart for Older Adults!

With over 50 million Americans aged 62 and older1, Older Adults are prime targets for financial 

exploitation both by persons they know and trust and by strangers. Financial exploitation has 

been called “the crime of the 21st century” with one study suggesting that older Americans lost 

at least $2.9 billion to financial exploitation by a broad spectrum of perpetrators in 2010.2

A key factor in some cases of elder financial exploitation is mild cognitive impairment which 

can diminish an older adult’s ability to make sound financial decisions. 

This epidemic is under the radar. The cases tend to be very complex and can be difficult to 

investigate and prosecute. Elders who lose their life savings usually have little or no opportunity 

to regain what they have lost. Elder financial abuse can result in the loss of the ability to live 

independently; decline in health; broken trust, and fractured families. 

Awareness and prevention is the first step. Planning ahead for financial wellbeing and the 

possibility of diminished financial capacity is critical. Reporting and early intervention that 

results in loss prevention is imperative. 

Money Smart for Older Adults is designed to provide you with information and tips to help

prevent common frauds, scams and other types of elder financial exploitation in your 

community. Please share this information as appropriate. 

 1 2010 Census: 57 million are 60 and over; 40 million aged 65 and over. 

2 The MetLife Study of Elder Financial Abuse: Crimes of Occasion, Desperation, and Predation against America’s Elders (New York, 

NY: MetLife, June 2011).
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Acknowledgements

The FDIC and CFPB wish to thank the following agencies for contributing to the information 

covered in this course:

• US Department of Health and Human Services’ Administration for Community 

Living/Administration on Aging – Senior Medicare Patrol

• Federal Trade Commission

• Securities and Exchange Commission 

• Social Security Administration

• Financial Industry Regulatory Authority, Inc. 
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Table of Contents

Checking In...................................................................................................................................4

Getting Started .............................................................................................................................5

Common Types of Older Adult Financial Exploitation ...........................................................8

Activity 1: Telephone Scams .....................................................................................................17

Identity Theft...............................................................................................................................20

Medical Identity Theft ...............................................................................................................24

Activity 2: Identity Theft Self-Check .......................................................................................27

Planning For UnexpectedLife Events.......................................................................................29

How to Be Financially Prepared for Disasters.........................................................................30

Activity 3: How Financially Prepared Are You? ....................................................................33

Scams that Target Homeowners...............................................................................................33

Scams that Target Veterans Benefits .......................................................................................37

Post-Test......................................................................................................................................40

What Do You Know? – Money Smart for Older Adults........................................................42

Evaluation Form.........................................................................................................................43

Glossary.......................................................................................................................................45

For Further Information ...........................................................................................................48

Report Financial Exploitation...................................................................................................52
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Checking In

Welcome

Welcome to Money Smart for Older Adults! By taking this course, you’ll learn important points to 

consider in planning for a more secure financial future, including how to guard against identity theft 

and other forms of financial exploitation, how to prepare financially for unexpected life events, and 

what to have ready in case disaster strikes. 

Objectives

After completing this module, you will be better able to:

• Recognize and reduce the risk of elder financial exploitation

• Guard against identity theft

• Plan for possible loss of your ability to manage your finances

• Prepare financially for disasters

• Find other helpful resources for managing your money and reporting financial 

exploitation

Participant Materials

The Participant/Resource Guide contains:

• Information and activities to help you learn the material

• Tools and instructions to complete the activities

• A glossary of the terms used in this module

• Resources for information on managing your money and reporting financial exploitation
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Getting Started

Let’s start by establishing an understanding of elder financial exploitation. Financial 

exploitation is a form of elder abuse. Elder abuse can take many forms, alone or in combination, 

including physical, psychological, emotional, or sexual abuse, neglect, abandonment, and selfneglect.

What is elder financial exploitation?

As defined by the Older Americans Act:

Financial exploitation is the fraudulent or otherwise illegal, unauthorized, or improper actions 

by a caregiver, fiduciary, or other individual in which the resources of an older person are used 

by another for personal profit or gain; or actions that result in depriving an older person of the 

benefits, resources, belongings, or assets to which they are entitled. 

Elder financial exploitation is the theft of money, property or belongings.

Who is at risk for elder financial exploitation?

Anyone can be the victim of financial exploitation. Financial exploitation crosses all social, 

educational, and economic boundaries. 

Why are older adults at risk of financial exploitation?

The following circumstances or conditions, especially in combination, can make an older adult 

more vulnerable to financial exploitation. 

Older adults may:

• Have regular income and accumulated assets 

• Be trusting and polite

• Be lonely and socially isolated 

• Be vulnerable due to grief from the loss of a spouse, family member, friend, or pet

• Be reluctant to report exploitation by a family member, caregiver, or someone they 

depend on

• Be dependent on support from a family member or caregiver to remain independent

• Be receiving care from a person with substance abuse, gambling or financial problems, or 

mental health issues 

• Fear retaliation by the exploiter
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• Be unfamiliar with managing financial matters 

• Be unprepared for retirement and the potential loss of financial decision-making capacity 

• Have cognitive impairments that affect financial decision-making and judgment 

• Be dependent on a family member, caregiver or another person who may pressure them 

for money or control of their finances.

What are some examples of financial exploitation?

• Exploitation by an agent under Power of Attorney or person in a fiduciary relationship 

(see glossary for definition of fiduciary)

• Theft of money or property, often by a caregiver or in-home helper

• Investment fraud and scams, including deceptive “free-lunch seminars” selling 

unnecessary or fraudulent financial services or products 

• Lottery and sweepstakes scams

• Scams by telemarketers, mail offers or door-to-door salespersons

• Computer and Internet scams

• Identity theft

• Reverse mortgage fraud

• Contractor fraud and home improvement scams

Who are the abusers?

Perpetrators of financial exploitation can be:

• Family members and caregivers

• Friends, neighbors or acquaintances

• Persons with Power of Attorney or the legal authority to access or manage your money

• Telephone and mail scammers

• Financial advisers

• Internet scammers

• Home repair contractors 

• Medicare scam operators

• Other persons known or unknown to the older adult
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Why do you think older adults don’t report financial exploitation? 

• Shame and embarrassment ̶ Many people are ashamed to admit that they have been 

financially exploited. 

• Loyalty ̶ Reluctance to report a family member, caregiver or other person who may treat 

them well in other ways.

• Fear of retaliation, not being believed or losing their independence by being declared 

incompetent and moved into a “nursing home.”

• Dependence on the abuser for care or assistance.

• Denial ̶ Some victims are unwilling or unable to acknowledge that financial exploitation 

is happening to them.

• Self-blame – Abuse can erode an older person’s self-esteem, and some victims may 

believe they deserve or have caused the abuse.

• Lack of awareness – Some victims are unaware that they are being exploited, or don’t 

know to whom they can report financial exploitation.

What should you do if you or someone you know becomes a victim of financial 

exploitation or another form of elder abuse?

In most cases, you would contact Adult Protective Services, generally a part of your county or 

state department of social services. You can find contact information at www.eldercare.gov, a 

public service provided by the U.S. Administration on Aging, or by calling 1-800-677-1116. 

For cases of identity theft, contact your local police and the Federal Trade Commission (FTC). 

If the loss involves funds held in a financial institution, such as a bank or credit union, report 

the problem to the institution immediately. 

If you have concerns with an FDIC-supervised financial institution, go to 

www2.fdic.gov/starsmail/index.asp

You will find more information at the end of this guide. Of course, if the person is in danger or 

you believe a crime has been committed, call 911 for immediate help.
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Common Types of Older Adult Financial Exploitation

This module doesn’t cover all types of elder financial exploitation in depth however it does 

discuss the key points and give some general guidelines you can use to help you identify fraud, 

scams and other types of financial exploitation and tips to help you prevent it from happening. 

This guide also provides a list of resources that you can consult as the need arises.

Power of Attorney (POA) or Fiduciary Abuse

A person who is named to manage your money or property is a fiduciary. He or she has a duty 

to manage your money and property for your benefit however he or she may abuse that power. 

The person you appoint as your fiduciary should be trustworthy and honest. Your fiduciary can 

removed if they do not fulfill their obligations or duties. Fiduciaries can be sued and may be 

ordered to repay money. If elder financial exploitation is reported to the police or Adult 

Protective Service, the fiduciary could be investigated. If the fiduciary is convicted of stealing 

your assets, he or she can go to jail. 

One way some older adults prepare for the possibility of diminished financial decision-making 

capacity is by making a power of attorney for finances and designating someone they trust to 

handle their financial decisions if they no longer can. 

Creating a POA is a private way to appoint a substitute decision maker and is relatively 

inexpensive. If you don’t appoint a POA before your decision-making ability declines, a family 

member or friend might have to go to court to have a guardian appointed – and that process can 

be lengthy, expensive, and very public.

A POA does involve some risk. It gives someone else – your agent – a great deal of authority 

over your finances without regular oversight. POA abuse can take many forms: 

• Your agent might pressure you for authority that you do not want to grant.

• Your agent may spend your money on him or herself rather than for your benefit.

• Your agent might do things you didn’t authorize him or her to do – for example, make 

gifts or change beneficiaries on insurance policies or retirement plans.
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Different types of POAs

Some states allow for different types of POAs. Generally, a Power of Attorney goes into effect 

as soon as it is signed unless the document specifies a different arrangement. That means that 

even if you are capable of making decisions, your representative can immediately act on your 

behalf.

A “Durable” Power of Attorney remains effective even if the maker loses the capacity to make 

financial decisions. 

There are different types of powers of attorney and ways to customize this document to fit your 

needs and preferences. Talk to an attorney for help in making a POA that is appropriate for 

your circumstances.

What are some ways to minimize the risk of POA abuse?

• Trust, but verify. Only appoint someone you really trust and make sure they know your 

wishes and preferences. You can require in your POA that your agent regularly report to 

another person on the financial transactions he or she makes on your behalf. 

• Avoid appointing a person who has substance abuse, gambling problems, or who 

mismanages money. 

• Tell friends, family members, and financial advisers about your POA so they can look out 

for you.

• Ask your bank about their POA procedures. The bank may have its own form you are 

required to complete (although a POA that is valid under your state’s law should be 

accepted by financial service providers).

• Remember that POA designations are not written in stone – you can change them. If you 

decide that your agent isn’t the best person to handle your finances, you can revoke 

(cancel) your POA. Notify your financial institution if you do this.

• Avoid appointing hired caregivers or other paid helpers as your agent under Power of 

Attorney.

• Beware of someone who wants to help you out by handling your finances and be your 

new “best friend.” If an offer of help seems too good to be true, it probably is.
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Plan ahead! A durable power of attorney is a very important tool in planning for financial 

incapacity due to Alzheimer’s disease, another form of dementia, or other health problems. It is 

advisable to consult with an attorney when preparing a power of attorney, trust or any legal 

document giving someone else authority over your finances. 

If you or a loved one is a victim of financial exploitation by a fiduciary, take action immediately 

and make a report to Adult Protective Services or your local law enforcement agency. 

Abuse by Caregivers and In-Home Helpers

Family members and caregivers are common perpetrators of elder financial exploitation. 

You can take steps to guard against financial exploitation if you or your loved one needs 

someone to help at home.

• Secure your valuables such as jewelry and other property.

• Secure your private financial documents including checks, financial statements and credit 

cards. Consider a locked file cabinet.

• Require receipts for purchases made by helpers. 

• Monitor bank accounts and telephone bills – Ask for help from a third party, if needed,

and consider an automatic bill pay system. Consider setting up transaction alerts that are 

monitored by a family member or other third party. 

• Do not let hired caregivers or helpers open your mail, pay your bills, or manage your 

finances.

• Never promise money or assets to someone when you die in exchange for care provided 

now.

• Never lend employees money or personal property. 

• If you have trouble reading your statement, ask your bank if a second copy of your bank 

statement can go to someone who can read it for you. (Also, your bank may be able to 

send you your bank statement in large print.) This person does not need to have authority 

to act on your behalf.

• Never let caregivers use your credit/debit card to run errands or make purchases for you.
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Investment Fraud

We’ve all heard the timeless saying “If it sounds too good to be true, it probably is.” As an 

investor, these are good words to live by. The trick is knowing when “good” becomes “too 

good.” 

Senior certifications and designations

A popular practice among financial services salespeople is to identify themselves by a “senior 

designation” to signal that they have expertise in retirement or the investment needs of older 

people. 

The requirements to earn and maintain a senior designation vary considerably. Programs of 

study range from weekend seminars to two-year graduate programs. The initials on a business 

card don’t provide information about the quality of the designation. Some designations indicate 

extensive knowledge in senior financial needs, while others are merely marketing tools.

While the vast majority of investment advisers, financial planners, and broker-dealers are 

honest and reputable, it pays to check on a senior designation if you are presented with one. Be 

wary of investment scams, including the ones listed below. 

Common investment scams

• Ponzi schemes: This is an old scam with a simple formula: Scammers promise high 

returns to investors. Money from new investors is used to pay previous investors. These 

schemes eventually collapse—leaving most of the investors with a financial loss. 

• Promissory notes: A promissory note is a form of debt – similar to a loan or an IOU –

that a company may issue to raise money. Typically, an investor agrees to loan money to 

the company for a set period of time. In exchange, the company promises to pay the 

investor a fixed return on his or her investment. While promissory notes can be 

legitimate investments, those that are marketed broadly to individual investors often turn 

out to be scams.

• Unscrupulous financial advisers: Some advisers cut corners or resort to outright fraud 

or bilking older adults with unexplained fees, unauthorized trades or other irregularities. 
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• Affinity fraud: Involves targeting persons with military, religious or spiritual affiliations, 

by ethnic identity, etc. 

• Internet fraud – the “Dot-Con:” Internet fraud has become a booming business. With 

the growing number of older adults using the Internet, it is increasingly easy for con 

artists to reach millions of potential older victims at minimal cost. 

• Inappropriate or fraudulent annuity sales. Variable annuities are often pitched to 

seniors through “free lunch” investment seminars. These products can be unsuitable for 

many retirees and are sometimes sold by salespersons who fail to disclose steep sales 

commissions and surrender charges that impose costly fees or penalties if you decide that 

you need your money before the maturity date. 

How to check out your broker or investment adviser 

You can check a broker’s background via the Financial Industry Regulatory Authority (FINRA) 

BrokerCheck at www.finra.org , or by calling the FINRA BrokerCheck Hotline at 1-800 289-

9999. You may also contact the state securities office and Better Business Bureau. 

To learn more about senior certification and designations, visit FINRA at 

http://www.finra.org/industry/issues/seniors/p124734. Scroll to the bottom of the FINRA page 

to find links to other helpful resources.

Financial loss prevention tips

Invest wisely online and offline. Here are some important tips you should keep in mind when 

you are considering purchasing investment products and for protecting those investments once 

you have them:

• Never judge a person’s trustworthiness by the sound of their voice. 

• Take your time when making investment choices. Be careful of “act now” or “before it’s 

too late” statements.

• Say “no” to anybody who tries to pressure you or rush you into an investment.

• Be wary of salespeople who prey upon your fears or promise returns that sound too good 

to be true. 

• Always ask for a written explanation of any investment opportunity and then shop around

and get a second opinion.

• Be wary of any financial adviser who tells you to leave everything in his or her care. 
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• Stay in charge of your money or enlist the help of a trusted third party to assist you. 

• Make checks payable to a company or financial institution, never an individual.

• Retain and maintain account statements and confirmations you receive about your 

investment transaction.

• Document all conversations with financial advisers.

• Take immediate action if you detect a problem. Time is critical, so do not be afraid to 

complain.

• Don’t let embarrassment or fear stop you from reporting financial exploitation or

investment fraud.

• Don’t put all your eggs in one basket— divide your investments among different asset 

categories, such as stocks, bonds, and cash held in federally insured deposit accounts

Here are additional tips to keep in mind when considering investment products

• Have enough emergency money in a savings or other readily accessible federally insured 

deposit account to support you and your family for at least six months before investing in 

non-deposit products.

• Do your homework. Never invest in a product you do not understand. 

• Attend classes, seminars, or check the business reference section of the public library to 

become better informed. 

• Be aware that many investment professionals offer “free seminars” as a marketing 

technique for obtaining new clients. Be sure to check the background of the presenter, 

research any recommended investment products, and get a second opinion before making 

the decision to invest.

• Understand the risks before investing. Investments always have some degree of risk.

• Be sure your financial adviser knows your financial objectives and risk tolerance.

Understanding FDIC insurance

If you select investment products offered by a bank, it is important to understand which of your 

investments are covered by the Federal Deposit Insurance Corporation or FDIC. The FDIC 

insures funds in deposit accounts at FDIC-insured institutions including: 

• Checking 

• Savings 
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• Money Market Deposit Accounts (MMDAs) 

• Certificates of Deposit (CDs) 

Another federal agency, the National Credit Union Administration, provides similar deposit 

insurance coverage to depositors at federally insured credit unions. 

FDIC insurance protects depositors up to a capped amount in the event of a bank failure. It 

does not protect depositors from losses resulting from theft, fraud, or robbery.

FDIC insurance also does not cover other financial products and services that insured banks 

may offer (e.g., stocks, bonds, mutual fund shares, life insurance policies, annuities and 

municipal securities). These products should be sold separately by individuals who do not offer 

insured deposit products. Be alert when bank personnel transfer you to another 

“representative.” Read the disclosures carefully. Disclosures for non-deposit products 

must indicate that they are NOT FDIC insured.

By law, federal deposit insurance is backed by the full faith and credit of the Federal 

Government. If a bank fails, the FDIC will pay all insured deposits up to the insurance limit, 

including principal and any accrued interest through the date of the bank closing. Federal law 

requires that all insured deposits be paid as soon as possible. 

Insurance coverage and ownership categories 

Deposit insurance coverage is based on a depositor’s ability to meet the specific requirements 

for an ownership category. The most common account ownership categories for individual and 

family deposits are single accounts, joint accounts, revocable trust accounts, and certain 

retirement accounts. 

Each ownership category has different requirements, and the potential amount of insurance 

coverage for each category is based on the Standard Maximum Deposit Insurance Amount 

(SMDIA), which is $250,000.

For additional details on the coverage limits, requirements, and in-depth information on all 

account ownership categories and other types of deposit accounts, visit 
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www.fdic.gov/deposit/deposits, call toll-free 1-877-ASK-FDIC (1-877-275-3342), or talk to 

your bank representative. 

Lottery and Sweepstakes Scams

Sweepstakes scams may come in the form of a telephone call or an email that congratulates the 

recipient on winning a lottery, drawing, or sweepstakes that they usually have not even entered. 

The scammer asks the “winner” for an upfront payment, perhaps to cover a processing fee or 

taxes. Another variation of this scam involves a letter, sometimes with an authentic looking 

“Claim Certificate” or a “check” as an advance to pay the winnings. Although bankers are 

generally aware of this scam and how to spot the phony checks, if deposited, the financial 

institution may hold the victim responsible for repayment of the entire amount of the fraudulent 

check and the overdraft charges that may result. 

Sweepstakes Recovery Scam 

Once it is apparent that no winnings are forthcoming, the victim may receive another call from a 

person claiming to be an attorney representing sweepstakes winners. In exchange for an upfront 

fee, the so-called attorney offers to collect the winnings on behalf of the victim. Needless to 

say, the “attorney” is actually an associate of the original scammer.

Telephone Scams

Older adults are increasingly the targets of scam artists on the telephone who use lies, 

deception, and fear tactics to convince the elder to send them money or provide personal 

account information. An example of a common scam Money Smart for Older Adults explores 

is the "grandparent scam ." In this scam, an imposter calls a grandparent pretending to be a 

grandchild in trouble; the scammer may even know the grandchild's name. The scammer is 

usually crying making it hard to recognize the grandchild's voice. The scammer pleads for the 

grandparent to immediately wire money and not tell any family members for fear of upsetting 

them. Many people will immediately jump to the assistance of the grandchild and won't ask 

questions until later. They also know that many older people will have experienced a hearing 

loss and won't detect any differences from their grandchild's voice. Or they may attribute the 

differences they do hear to the stress of the situation.
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Tips for Avoiding Telephone Scams

Scammers can be very convincing. If something seems unusual, check it out.

• Never “pay to play.” A legitimate sweepstakes will not ask for money upfront.

• You cannot win a sweepstakes or lottery that you did not enter.

• Be suspicious of any pressure to send funds via wire transfer or a pre-paid reloadable 

card.

• Pay attention to warnings from your financial institution that a request sounds like a 

scam. Your banker may have encountered similar situations in the past.

• Scammers often claim an emergency, hoping you will take quick action without checking 

out the situation. Before offering help to a grandchild (or another relative or friend), be 

sure to telephone your grandchild or the parents at a number you know to be valid to find 

out if the request is legitimate. 

• If a caller claims to be from an established organization such as a hospital or law 

enforcement agency, look up the number of the organization independently before taking 

action. 

• Consider it a red flag if the caller insists on secrecy. Never allow anyone to isolate or 

discourage you from seeking information, verification, support and counsel from family 

members, friends or trusted advisors prior to making any financial transaction. 
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Activity 1: Telephone Scams

Read each scenario and then, based on what you have learned, answer the questions in the space 

provided:

Scenario 1 

Myra is home watching TV when the telephone rings. She answers the call and the man on the 

line says “Congratulations! You’ve won $2.7 million dollars in the lottery!” Myra is surprised. 

Although she buys lottery tickets, she hasn’t given her name to anyone. The caller tells her that 

there are a couple of things she needs to do to complete the process so she can receive her 

check. He directs Myra to go to her bank and withdraw $2,700 to cover processing fees. He 

tells her to forward the funds through a local wire service or to buy and send a special prepaid 

card that she can get to expedite the process. Myra heads to her bank to withdraw the money. 

The next day the person calls to say they received the funds and an additional $5,000 is needed 

to pay the taxes. 

What are the red flags that should warn Myra that she is about to become a victim of a scam? 

_____________________________________________________________________________

_____________________________________________________________________________

_____________________________________________________________________________

_____________________________________________________________________________

Scenario 2 

A few weeks after Myra used a pre-paid card to transfer money to the scammer, she received a 

call from a person claiming to be an attorney representing sweepstakes winners. The attorney 

offered to collect the winnings for Myra but she would have to pay his $7,000 fee up front.

What should Myra do? 

_____________________________________________________________________________

_____________________________________________________________________________

_____________________________________________________________________________

_____________________________________________________________________________
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Scenario 3 

Jack lives alone in his home of 40 years. He has become increasingly hard of hearing, which 

has made it difficult for him to communicate on the telephone. One afternoon he receives a call 

from a distressed-sounding person who says “Hi Grandpa, this is your favorite grandson.” 

When Jack asks “is this Johnny?” the caller says “yes grandpa, it’s Johnny.” Johnny says he’s 

in Canada and has been arrested. Johnny explains that he needs Jack to wire $2,500 to bail him 

out. Johnny also says “please don’t tell mom – I don’t want her to be upset.” Jack hurries to 

his bank or credit union and insists on wiring the money despite warnings from the teller and 

the bank manager that this sounds like a scam.

What are the red flags in this story? 

_____________________________________________________________________________

_____________________________________________________________________________

_____________________________________________________________________________

_____________________________________________________________________________

Computer/Internet Scams

Lack of familiarity with internet security and scams such as phishing and spoofing can dupe 

older adults into giving out personal financial information. Phishing scammers create 

authentic-looking emails, text messages, and Internet pages to entice their victims to disclose 

financial information such as credit card details, bank or credit card account numbers, Social 

Security numbers, etc. 

Here are some examples: 

• "We suspect an unauthorized transaction on your account. To ensure that your account is 

not compromised, please click the link below and confirm your identity."

• "During our regular verification of accounts, we couldn't verify your information. Please 

click here to update and verify your information."

• “Our records indicate that your account was overcharged. You must call us within 7 days 

to receive your refund.”

The messages may appear to be from organizations you do business with–such as your financial 

institution. They may threaten to close your account or take other action if you don’t respond.
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The senders are “phishing” for your private account information so they can use it to commit 

fraud or identity theft against you.

Spoofing scammers disguise an email address to look like it is coming from someone else. For 

example, you may receive an email that looks like it is coming from a friend who needs 

immediate funds to cope with an emergency.

Tips for avoiding computer or Internet scams

Take precautions with your personal computer (PC) to reduce your risk of a computer/Internet 

attack:

• Use trusted security software and make sure it’s updated frequently. 

• Do not email financial information or account numbers. Email is not a secure method of 

transmitting personal information.

• Be cautious about opening attachments and downloading files from emails, regardless of 

who sent them. These files can contain viruses or other malware that can compromise 

your computer's security.

• Use passwords that will be hard for hackers to guess. For example, use a mix of numbers,

symbols, and letters instead of easily guessed words.

• Shut down your PC when you are not using it.

For practical tips to help you guard against Internet fraud, secure your computer, and protect

your personal information, visit www.OnGuardOnline.gov.

How to Respond to a Phishing [or Spoofing] Attack

Even if you use security software, chances are that some questionable messages will get 

through. Some of these messages look very realistic. Here are some tips for protecting 

yourself.

• Do not open any message that comes from an unfamiliar source. If you open a suspicious 

message, delete it. Do not click on links or call telephone numbers provided in the

message. Be wary about opening attachments. 
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• Delete email and text messages that ask you to confirm or provide personal information 

(credit card and bank account numbers, Social Security numbers, passwords, etc.). 

Legitimate companies never ask for this information via email or text.

• If you’re concerned about your account or need to reach an organization that you do 

business with, call the number on your financial statements or on the back of your credit 

card or in the telephone book. Do not call the telephone number that the caller or spoof 

website provides you!

• If you receive an email that looks like it is from a friend or relative asking you to send 

money, call to verify that the email really came from them.

For more information, go to http://onguardonline.gov/articles/0003-phishing.

Victims of phishing could become victims of identity theft. If you might have been tricked by a 

phishing email, act promptly to avoid financial loss or damage to your credit. You’ll find more 

information at the end of the following section on Identity Theft. 

Identity Theft

Identity theft occurs when thieves steal your personal information (e.g., your Social Security

number (SSN), birth date, credit card numbers, personal identification numbers (PINs), or 

passwords). With sufficient information, another person can become you and use your identity

to commit fraud or other crimes.

How to Avoid Identity Theft

• Protect your SSN, credit card and debit card numbers, PINs, passwords, and other 

personal information.

Never provide this information in response to an unwanted telephone call, fax, letter, or

email, no matter how friendly or official the circumstances may appear. Be mindful of

those who may be “shoulder surfing” (or trying to look over your shoulder) while you use

the ATM, and seeking to steal your PIN. In case your wallet is lost or stolen, carry only

the identification you really need: checks, credit cards, or debit cards. Keep the rest,

including your Social Security card, in a safe place. Do not preprint your SSN, telephone

number, or driver’s license number on your checks. You do not have to give merchants 
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your Social Security number. Ask the merchant to use another form of identification that

does not include your SSN (e.g., a passport).

• Protect your incoming and outgoing mail.

For incoming mail: Try to use a locked mailbox or other secure location (e.g., a post 

office box). If your mailbox is not locked or in a secure location, try to promptly remove 

mail that has been delivered or move the mailbox to a safer place. When ordering new 

checks, ask about having the checks delivered to your bank branch instead of having 

them mailed to your home where you run the risk of a thief finding them outside your 

front door.

For outgoing mail containing a check or personal information: Try to deposit it in a 

United States (U.S.) Postal Service blue collection box, hand it to a mail carrier, or take it 

to the post office instead of leaving it in your doorway or home mailbox. A mailbox that 

holds your outgoing bills is a prime target for thieves who cruise neighborhoods looking 

for account information. Avoid putting up the flag on a mailbox to indicate that outgoing 

mail is waiting.

• Sign up for direct deposit.

Sign up for direct deposit of your paycheck, retirement check, or state or federal benefits,

(e.g., Social Security). Direct deposit prevents someone from stealing a check out of your

mailbox and forging your signature to access your money. Direct deposit is also beneficial

in the event of a disaster.

• Keep your financial trash “clean.”

Thieves known as dumpster divers pick through garbage looking for pieces of paper

containing SSNs, bank account information, and other details they can use to commit

fraud. What is your best protection against dumpster divers? Before tossing out these

items, destroy them, preferably using a crosscut shredder that turns paper into confetti that 

cannot be easily reconstructed.
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• Keep a close watch on your bank account statements and credit card bills.

Monitor these statements each month and contact your financial institution immediately if

there is a discrepancy in your records or if you notice something suspicious (e.g., a

missing payment or an unauthorized withdrawal). Contact your institution if a bank

statement or credit card bill does not arrive on time. Missing financially related mail 

could be a sign someone has stolen your mail and/or account information, and may have

changed your mailing address to run up bills in your name from another location.

• Avoid identity theft on the Internet.

As we mentioned in the section on Computer/Internet Scams, never provide bank account

or other personal information in response to an unsolicited email, or when visiting a 

website that does not explain how personal information will be protected. Legitimate

organizations would not ask you for these details because they already have the necessary

information, or can obtain it in other ways. If you believe the email is fraudulent,

consider bringing it to the attention of the Federal Trade Commission (FTC) via its online 

complaint form: www.ftccomplaintassistant.gov.

 

If you do open and respond to a phony email, contact your financial institution

immediately and follow the steps listed in the FTC brochures listed at the end of this 

guide. For more about avoiding phishing scams, visit 

http://onguardonline.gov/articles/0003-phishing. 

• Review your credit report annually and report fraudulent activity.

Review your credit report carefully for warning signs of actual or potential identity theft. 

For example, items that include mention of a credit card, loan, or lease you never signed

up for, and requests for a copy of your credit report from someone you do not recognize

could be a sign that a con artist is snooping around for personal information. To obtain a 

free copy of your credit report, visit www.annualcreditreport.com
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Fraud Alert: Social Security Administration

The Inspector General for the Social Security Administration (SSA) is warning the 

public, and Social Security beneficiaries in particular, to be aware of fraud scams that 

target personal information. 

In the most recent scam, identity thieves obtain the personal information of Social 

Security beneficiaries and use that information to attempt to open a 'my Social Security' 

account on SSA's website. If successful, they then use that account to redirect the 

beneficiary's direct deposit benefits to an account controlled by the thief.

This should in no way discourage people from using SSA's 'my Social Security' feature, 

which enables the public to view their earnings history and estimated benefits, and allows 

beneficiaries to obtain a host of services online; in fact establishing your account 

eliminates the risk of a new account being opened by an identity thief. This type of crime 

does, however, serve as a reminder to protect your personal information as you would 

any other thing of value. Once thieves have your personal information, they can use it to 

open credit accounts, buy homes, claim tax refunds, and commit other types of fraud.

If you receive information from SSA indicating that you have opened a 'my Social 

Security' account, and you did not open an account, you should contact Social Security so 

that appropriate action may be taken, and the matter may be referred to the Office of the 

Inspector General. You can do so by visiting or calling a local SSA office or calling 

SSA's toll free customer service at 1-800-772-1213. Deaf or hearing-impaired individuals 

can call Social Security's TTY number at 1-800-325-0778.

Get more information on identity theft

Visit the FTC’s Identity Theft website at www.ftc.gov/idtheft for information on how to 

minimize your risk or call them at1-877-IDTHEFT (438-4338).
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Identity Theft: If You Think You May Be a Victim

If you believe you are a victim of identity theft, the FTC recommends that you immediately 

take the following actions: 

• Place an initial fraud alert with one of the three nationwide credit reporting companies

• Order your credit reports

• Create an identity theft report

• Consider placing an extended fraud alert or security freeze on your credit report to limit 

the circumstances under which a credit reporting company may release your credit report. 

For more information:

http://www.consumer.ftc.gov/articles/0279-extended-fraud-alerts-and-credit-freezes

The FTC has many resources available to help you. Call the FTC’s Identity Theft Hotline at 1-

877-IDTHEFT (438-4338) or visit www.ftc.gov/idtheft . Its online toolkit includes:

• A brochure covering the basics ̶ Identity Theft: What To Know, What To Do

• A detailed guide for protecting your information, with instructions and sample letters to 

help identity theft victims ̶ Taking Charge: What to Do If Your Identity Is Stolen

Sample letters to help you dispute unauthorized charges or the opening of new accounts 

in your name. Sample letters and forms are available at 

http://www.consumer.ftc.gov/articles/0281-sample-letters-and-forms-victims-identitytheft

Medical Identity Theft

Medical identity theft is serious business. According to one study, about 1.5 million adults are 

victims of medical identity theft each year. 

What Is Medical Identity Theft?

Medical ID theft occurs when someone steals personal information — such as your name and 

Medicare number — and uses the information to get medical treatment, prescription drugs, 

surgery or other services and then bills Medicare for it. Medicare ID theft is a form of Medicare 

fraud.
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A thief may use your name or health insurance numbers to see a doctor, get prescription drugs, 

file claims with your insurance provider, or get other care. If the thief’s health information is 

mixed with yours, your treatment, insurance and payment records, and credit report may be 

affected.

If you see signs of medical identity theft, order copies of your records and check for mistakes. 

You have the right to see your records and have mistakes corrected.

Medical ID theft can cause financial harm but it is about more than losing time and money. 

Sometimes people are denied a Medicare service or equipment because their records falsely 

show they already received it, when in fact it went to someone posing as them.

It can affect your medical and health insurance records. Every time a thief uses your identity to 

get care, a record is created with incorrect medical information about you. That information 

might include: 

• A different blood type

• An inaccurate history of drug or alcohol abuse

• Test results that are not yours

• A diagnosis of an illness, allergy or condition that you do not have

Any of these could lead to you receiving the wrong treatment and even being injured or getting 

sick due to an incorrect treatment.

All types of people, including doctors and medical equipment companies, have been caught 

stealing people’s medical identities. There have even been links to the mafia and thieves in 

other countries. Sadly, about one-third of medical identity thieves are family members.

How Do You Learn if You Are a Victim?

Here are some warning signs that your identity may be stolen:

• You get a bill for medical services you did not receive.

• You are contacted by a debt collection company for money you do not owe.

• Your insurance company says you’ve reached your limit on medical benefits.

• You are denied insurance for a medical condition you do not have.
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How to Avoid Medical Identity Theft

• Protect your Medicare and other health insurance cards in the same way you would 

protect a credit card. 

• Review your Medicare Summary Notices (MSN), Explanations of Benefits (EOB) 

statements and medical bills for suspicious charges. If you find incorrect information in 

your records, insist that it be corrected or removed. 

• Only give personal information to Medicare-approved doctors, other providers and 

suppliers; your State Health Insurance Assistance Program or Senior Medicare Patrol 

(SMP) program; or Social Security. [Call 1-800-MEDICARE (1-800-633-4227) if you 

aren’t sure if a provider is approved by Medicare.] 

• Beware of offers of free medical equipment, services or goods in exchange for your 

Medicare number. 

• Shred papers with your medical identity before putting them in the trash. Remove or 

destroy labels on prescription bottles and packages before you put them in the trash. 

How to Respond if You Suspect Medical Identity Theft

• Ask your health care provider for a copy of your current medical file. If anything seems 

wrong, write to your health plan or provider and ask for a correction.

• Contact your local Senior Medicare Patrol (see contact information below.)

How Your Senior Medicare Patrol (SMP) Can Help

Your local SMP is ready to provide you with the information you need to protect yourself from 

Medicare errors, fraud and abuse, detect potential errors, and report your concerns.

For more information or to locate your state SMP, visit www.smpresource.org
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Activity 2: Identity Theft Self-Check 

Review each response on the list and indicate whether you perform this action always, 

sometimes, or never. Then, tally your score and see how well you are taking measures to avoid 

identity theft. 

Always

(2 points)

Sometimes

(1 point)

Never

(0 points)

1. Cover or block the Point of Service (POS)/ATM 

keypad when I enter my PIN 

2. Carry only the identification, checks, credit 

cards, or debit cards I really need

3. Use direct deposit for paychecks, tax refunds, 

benefits payments, etc.

4. Shred documents with personal/financial 

information before disposing of/recycling them

5. Use complex passwords with a mix of numbers, 

symbols, and letters instead of easily guessed 

words

6. Review financial statements/bills monthly and 

identify/correct errors

7. Review my credit report annually and 

identify/correct errors

8. Use secure mailboxes for incoming/outgoing 

mail

9. Avoid providing/sharing personal information 

(e.g., SSN) whenever possible

10.Review my Medicare Summary Notices (MSN), 

Explanations of Benefits (EOB) statements and 

medical bills for suspicious charges.

Total each column

Grand Total
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Scores:

0–6: You are not taking many actions to minimize your risk of identity theft. Consider what 

you have learned today, and consider how you can implement steps to protect your identity.

7–13: You have developed some good practices to avoid identity theft; however, you have 

room for improvement. Consider what actions you need to take or apply more regularly to 

better protect your identity.

14–20: You are doing a great job at minimizing your risk of identity theft. Continue to apply 

these actions regularly and determine what additional steps you can take to protect your 

identity. 1.
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Planning For Unexpected Life Events

Planning ahead:

• Gives you control; you make choices for your situation

• Relieves the stress of decision-making from caretakers/family members

• Saves money and helps you avoid financial disaster or setback

• Allows time for gathering information, comparing options, and determining which options

help achieve what is most important

Preparing for possible future health problems 

The majority of people who need long-term care are older adults. However, the need for longterm care can come at any age due to disabling diseases, car accidents, brain injuries, strokes,

and other disabling events.

Families and individuals who plan ahead before a disability will be in a better position to cope in 

the event of a disability. Consider taking these steps before you or a family member becomes ill

or disabled:

• Prepare a plan. Start with reviewing your income and expenses.

• Make sure trusted family members know where to find personal and financial

documents in an emergency.

• Set up direct deposit for income and benefit checks. Direct deposit delivers your 

Social Security or Supplemental Security Income (SSI) benefit or other income sources 

into your bank, savings and loan, or credit union account quickly and safely. 

• Consider automatic payment of important, recurring bills.

• Consider a durable power of attorney. As we mentioned in the section on Power of 

Attorney, this legal document gives one or more people the authority to handle finances

and remains in effect if you become incapacitated.

• Make sure you are properly insured. Speak with a financial planner or an insurance

agent you trust. Review your policy regulary because your needs can change.

• Maintain a healthy lifestyle.
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Experts also recommend a health care power of attorney or health care proxy designating a

family member or other trusted person to make decisions about medical treatment. Living wills

and health care proxies are intended to ensure that someone’s wishes regarding medical care are

honored.

Direct Deposit of your Social Security Benefit

Let’s go into a little more detail about direct deposit of your Social Security and Supplemental 

Security Income (SSI) benefit payments. Applicants filing for these benefits must now choose 

either direct deposit or the Direct Express® debit card. Currently entitled beneficiaries and 

recipients who had been receiving payment by check have had to switch to direct deposit to a 

checking account or a pre-paid card they select or to the Direct Express® debit card.

How direct deposit of your Social Security benefit works 

The U.S. Treasury sends an electronic message to your bank, savings and loan, or credit union 

crediting your account with the exact amount of your Social Security or SSI benefit. You can 

withdraw money, put some in savings or pay bills ̶ the ordinary things you do with your money. 

The difference is, your check isn't printed or mailed. For more information, please visit the 

Department of the Treasury’s Go Direct® website http://www.godirect.org

How to Be Financially Prepared for Disasters 

Natural or man-made disasters can strike without warning and can happen anywhere. These

include floods, fires, earthquakes, tornadoes, hurricanes, chemical spills or similar events that

can force people to evacuate their homes. Even minor disasters can damage or destroy property

or other belongings. They can also seriously impair your ability to conduct essential financial 

transactions for a period of time. In addition to planning for your personal safety and basic

needs (e.g., shelter, food, and water), you should be ready to deal with financial challenges,

including how to pay for supplies or temporary housing if necessary.
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What to Have Ready

Consider keeping the following documents, bank products, and other items in a secure place and

readily available in an emergency:

• Forms of identification: These primarily include driver’s licenses (or state identification

cards for non-drivers), insurance cards, Social Security card, passport, and birth

certificate.

• Your checkbook with enough blank checks and deposit slips to last at least a month

• ATM cards, debit cards (for use at ATMs and merchants), and credit cards: Do not

assume that merchants and ATMs in areas affected by a disaster will immediately be

functioning as usual. Have other options available for getting cash and making payments.

• Cash

• Telephone numbers for your financial services providers: These include local and tollfree numbers for your bank, credit card companies, brokerage firms (for stocks, bonds, or

mutual fund investments) and insurance companies.

• Important account numbers: These include bank and brokerage account numbers, credit

card numbers, and homeowner’s or renter’s insurance policy numbers. You may want to

copy the front and back of your credit cards (and keep them in a safe place).

• The key to your safe deposit box

What to Keep and Where to Keep It

After you have gathered your most important financial items and documents, protect them as

well as you can while also ensuring you have access to them in an emergency. Here is a

reasonable strategy for many people:

• Make backup copies of important documents.

• Make an electronic image of your documents so you can more easily store the

information.

• Give a copy of your documents to loved ones or let them know where to find the

documents in an emergency.

• Store your backups some distance from your home in case the disaster impacts your entire

community.

• Make a record of all credit/debit cards with the account and contact numbers to report 

lost/stolen cards.
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Determine what to keep at home and what to store in a safe deposit box at your

bank.

A safe deposit box is best for protecting items of value and certain papers that could be difficult

or impossible to replace, but not anything you might need to access quickly. What should you

put in a safe deposit box? Examples include a birth certificate and originals of important 

contracts. What is better left safely at home, preferably in a durable, fireproof safe? Your

passport and medical care directives because you might need these on short notice. Consult your

attorney before putting an original will in a safe deposit box. Some states do not permit

immediate access to a safe deposit box after a person dies, so there may be complications

accessing a will stored in a safe deposit box. Remember that safe deposit boxes are not 

necessarily fireproof or waterproof.

Seal important documents in airtight and waterproof plastic bags or containers 

to prevent water damage.

Prepare one or more emergency evacuation bags.

Pack essential financial items and documents (e.g., cash, checks, copies of your credit cards and

identification cards, a key to your safe deposit box, and contact information for your financial

services providers). Make sure each evacuation bag is waterproof and easy to carry and kept in

a secure place in your home. Periodically update the contents of the bag. It will not do you any

good if the checks in your bag are for a closed account.

What Else to Consider

• Arrange for automatic bill payments from your bank account. This service enables

you to make scheduled payments (e.g., for your telephone bill, insurance premiums and

loan payments), and avoids late charges or service interruptions.

• Sign up for Internet banking services. This also makes it possible to conduct your

banking business without writing checks. Only do this if you feel comfortable with 

keeping your internet security software up-to-date.

• Review your insurance coverage. Make sure you have enough insurance, including:

personal property coverage, as applicable, to cover the cost to replace or repair your

home, car and other valuable property.
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To learn more about being financially prepared for disasters, visit

www.fdic.gov/consumers/consumer/news/index.html and type disaster preparedness in the

search box.

Activity 3: How Financially Prepared Are You? 

Think about what you have learned today. In the space provided, jot down what documents you 

will gather and where you will put them.

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

Scams that Target Homeowners

Reverse Mortgage Proceeds Fraud 

Scenario

To pay for his recommended home improvements, a handyman convinces an older woman to 

appoint him as her Power of Attorney so he can help her get a reverse mortgage on the home 

she had purchased in the 1950’s and owns outright. When the lender provided a lump-sum 

payout, she never saw any of the money because the handyman used it for drugs, among other 

things.

What is a reverse mortgage?

Although Reverse Mortgages can be legitimate products and are appropriate for many 

consumers, scammers also sell these products to the disadvantage of their victims.

A reverse mortgage is a special type of loan that allows homeowners age 62 and older to borrow 

against the equity in their homes. It is called a “reverse” mortgage because you receive money 

from the lender, instead of making payments. The money you receive, and the interest charged 
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on the loan, increases the balance of your loan each month. Over time, the equity you have in 

your home decreases as the amount you owe increases.

When you take out a reverse mortgage loan, you can receive your money as a line of credit 

available when you need it, in regular monthly installments, or up-front as a lump sum. You do 

not have to pay back the loan as long as you continue to live in the home, maintain your home, 

and stay current on expenses such as homeowner’s insurance and property taxes. If you move 

out or die, the loan becomes due and must be paid off. 

How borrowers get scammed

Scammers can take advantage of the fact that borrowers can receive the loan in the form of a 

lump sum payout. The reverse mortgage proceeds scam may include one or several of the 

following elements:

• Family members or others who pressure the older adult to get a reverse mortgage and 

then “borrow” the money or scam the elder out of the proceeds. 

• Scammers who “require” an older borrower to sign a Power of Attorney or to sign 

proceeds over to a “loan officer or other agent” for future “disbursals.” The scammers 

then embezzle a portion or all of the funds.

• Brokers who pressure or fraudulently require the borrower to purchase annuities, longterm care insurance, high risk investments or other financial products with the proceeds 

from the reverse mortgage in order to generate additional commissions.

Mortgage Assistance Rescue Scam

Beware of anyone who promises you can stay in your home or who asks for a lot of money to 

help you. Scammers might promise guaranteed or immediate relief from foreclosure, and they 

might charge you very high fees for little or no services. 

Mortgage relief companies may not collect any fees until they have provided you with a written 

offer from a lender or servicer that you decide is acceptable and a written document from the 

lender or servicer describing the key changes to the mortgage that would result if you accept the 

offer. The companies also must remind you of your right to reject the offer without any charge. 
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Don’t get scammed. There is help available at little or no cost to you. Foreclosure prevention 

counseling is available free of charge through HUD's Housing Counseling Program. Call the 

CFPB at 1-855-411-CFPB (2372) to be connected to a HUD-approved housing counselor.

Contractor Fraud and Home Improvement Scams

Scenario

Monica is 76 years old and lives alone in her home. One morning she is outside watering her 

garden when a truck pulls up and a man approaches her. He tells her that he is a building 

contractor and that he can see that she has a problem with her roof. He points to a spot near the 

chimney and tells her he can fix the problem now with the materials he has left over from a job 

he just finished nearby. He says he’ll give her a big discount if she’ll pay him today in cash. 

After going up on the roof and tearing off some roof tiles, he tells her that the problem is worse 

than he thought, but he can do it for $2,800. When Monica says she doesn’t have $2,800 in 

cash, the contractor becomes angry and threatening. He says if Monica doesn’t have the money 

she will have to take out a loan to pay him. 

Contractor Fraud

Home Repair / Home Improvement Scams

Sooner or later every home needs repairs or improvements. Although some home improvement 

companies do good work, some may not provide the level of service you expect. Many 

homeowners are targeted by scam artists who use high pressure tactics to sell unneeded and 

overpriced contracts for "home improvements." Often these scam artists charge more than their 

quoted prices or their work does not live up to their promises. When the homeowner refuses to 

pay for shoddy or incomplete work, the contractor or an affiliated lender threatens foreclosure 

on the home.

Impersonating Officials

Con artists may pose as building inspectors and order immediate repairs which they can do on 

the side. They may also pose as government officials and demand a fee for processing 

emergency loan documents. 
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Tips for Avoiding Contractor Fraud

Here are some common sense tips to protect yourself from contractor fraud.

• Ask to see identification for anyone representing him or herself as a government official. 

Call the government agency to verify the identity if there is any payment of money 

involved. 

• Get bids from several local, established contractors. Obtain at least three legible bids in 

writing and don’t sign anything before carefully reading it. Do not do business with 

anyone who approaches you door-to-door or on the phone. Note that many states and 

local jurisdictions have laws regulating door-to-door sales.

• Avoid contractors who:

̶ Are working door-to-door

̶ Come from out of state

̶ Don’t provide an address and telephone number, or refuse to show identification 

• Before beginning any home repair project, ask if the contractor has the required licenses 

(note license numbers) and is bonded. Seek out references from neighbors or members of 

your affinity groups (e.g., place of worship). 

• Check with your state licensing agency’s website or hotline to make sure the licenses are 

valid. Ask the licensing agencies if the contractor has a history of complaints.

• Get several references from previous customers. If possible, visit them to see the work 

done.

• Require the contractor you choose to provide you with a contract that contains clearly 

written payment terms.

• Don’t pay in advance.

• Never pay with cash. 

• Don’t provide personal financial information, such as your checking account, credit card 

or debit card numbers. 

• If you need to borrow money to pay for repairs, don’t let the contractor steer you toward 

a particular lender. 

• Do not make a final payment until you are satisfied with the job, all debris is removed 

from your property, and any necessary building inspections have been completed. If a 

contractor shows up at your door and pressures you to go to the bank with him to get cash 

to pay for a job you do not want done, if you ask to speak with the branch manager, the 
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manager can call the police for you, who can show up at the branch. Being in public 

place with video cameras and witnesses should reduce your risk.

To get more information on home improvement, including: how to hire contractors, how 

to understand your payment options, and how to protect against home improvement 

scams, read the FTC brochure titled Home Sweet Home Improvement. The brochure is 

available at www.ftc.gov. Enter home improvement in the search field. You can also call 

the FTC to request the brochure at 1-877-FTC-HELP (382-4357).

Scams that Target Veterans Benefits

Pension Benefits Filing Scam

The Veterans Affairs’ (VA) pension program provides monthly benefit payments to certain

wartime veterans with financial need, and their survivors. Recipients also may be eligible for 

one of two additional amounts:

• Aid and Attendance (A&A) may be paid to veterans, or their surviving spouses, who 

require assistance with activities of daily living, are bedridden, are patients in nursing 

homes, or have a qualifying major vision loss. 

• Housebound amounts may be paid to veterans or surviving spouses who are 

substantially confined to their homes because of a permanent disability.

Tips for avoiding VA pension benefits filing scams

• Be aware that an individual generally must be accredited by VA to assist you in 

preparing and filing a claim. To find an accredited attorney, claims agent, or veterans 

service organization (VSO), visit VA’s Accreditation Search page at 

http://www.va.gov/ogc/apps/accreditation/index.asp 

• Never pay a fee to anyone for preparing and filing your initial claim. Although an 

attorney may charge a consulting fee for advising you about the benefits for which 

you may be eligible, the clock stops running as soon as you indicate your intention to 

file.

• Avoid attorneys or claims agents who try to market financial products, such as trusts 

and annuities, in connection with filing your VA claim. Older veterans may face 
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problems with annuities since you may not have access to your funds, should you 

need them, without paying a costly surrender fee.

• Know that shifting your assets into certain types of investments in order to meet 

eligibility thresholds for VA pension benefits could make you ineligible for Medicaid 

for a period of time.

Lump-Sum Payment for Future Benefits Scam

Another scam targets veterans who receive either monthly disability compensation or pension 

payments. The scammer may offer a lump sum payment in exchange for the veteran’s future 

benefits. Although Federal law prohibits assigning benefits to a third party, many scammers --

who usually identify themselves as corporate entities -- get around this limitation by 

representing the lump sum payment as an advance. Whatever the name, these transactions 

generally are not a good deal for the veteran.

Consider this example:

A veteran received a lump-sum payment of $73,000 in exchange for his monthly benefits check 

of $2,744 for a ten-year period. At the end of the ten years, the veteran’s total repayment is 

estimated as $256,293. This translates to an annual interest rate of 44.5 percent.

Tips for avoiding the lump-sum payment scam

• Be aware that lump sum payment arrangements are very costly, often the equivalent of 

a 60 to 70 percent annual interest rate.

• Say no to arrangements that allow a creditor to access the account where you receive 

your benefits. Past arrangements have included joint checking accounts from which 

the scammer could withdraw funds as soon as they were deposited and accounts that 

remained in the veteran’s name but that allowed the lump-sum provider to make 

monthly withdrawals in the amount of the benefit.

• Remember that your military benefits cannot be garnished by a creditor. Some lumpsum providers know this, of course, and may ask for additional collateral.

• Seek advice from a trusted financial expert if you need emergency funds. Other 

arrangements are less costly.
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Where to Get More Information or Assistance

For help understanding your VA benefits, visit www.va.gov or call

1-800-827-1000. Also, the Federal Trade Commission: 

http://www.ftc.gov/opa/2013/02/vetspension.shtm
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Post-Test 

Now that you have gone through the course, see what you have learned.

1. Which of the following may be perpetrators of elder financial exploitation? Select all 

that apply.

a. Family members and caregivers 

b. Friends or neighbors 

c. Telephone and mail scammers

d. Financial advisers

2. What is true of a durable power of attorney (POA)? Select all that apply.

a. It remains in place if you become incapacitated.

b. It allows the person you select to make financial decisions on your behalf.

c. It cannot be changed.

d. No one else can monitor the actions of your designated POA.

3. If you receive a call or an email from someone claiming to be in trouble and in need of 

emergency funds, what should you do? Select all that apply.

a. Call the individual at a known home or cell phone number to verify that the need is 

legitimate.

b. Immediately wire funds to the account number provided.

c. If the call is from a hospital or law enforcement agency, look up the number of the 

institution and call the number you find.

d. Hang up immediately.

4. Your bank will never send you an email asking you to verify your account number or 

any other identifying information.

a. True

b. False
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5. Where can you check a financial adviser’s background?

a. FINRA BrokerCheck

b. Social Security Administration

c. State Securities Regulator

d. Federal Trade Commission

6. Which forms of identification should you have readily available in case of emergency?

a. Driver’s License

b. Insurance Card

c. Social Security Card

d. Passport 

e. Birth Certificate

7. What can you do to prepare financially for a disaster?

a. Set up automatic bill payments.

b. Know where to find important documentation in an emergency.

c. Review insurance information regularly to ensure you have adequate coverage.

d. All of the above.

8. What practices should you avoid in selecting someone to repair your roof?

a. Getting three bids in writing from local established contractors.

b. Using contractors who come to your door and tell you they are working for a 

neighbor.

c. Asking if the contractor has the required licenses and getting license numbers.

d. Paying in advance.

9. Match these items with the best place to keep them:

Birth certificate Emergency evacuation bag

Medical care directives Safe-deposit box

Passport Fireproof safe

Important contracts Fireproof safe

Items you may need in an emergency Safe-deposit box
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What Do You Know? – Money Smart for Older Adults

Instructor: ___________________________________ Date: ____________________

This form will allow you and the instructors to see what you know about protecting your 

finances both before and after the training. Read each statement below. Please circle the 

number that shows how much you agree with each statement.

Before the 

Training

After the Training

I am better able to:

Strongly DisagreeDisagreeAgreeStrongly AgreeStrongly DisagreeDisagreeAgreeStrongly Agree

1. Recognize and reduce the risk of 

elder financial exploitation. 1 2 3 4 1 2 3 4

2. Guard against identity theft. 1 2 3 4 1 2 3 4

3. Plan for unexpected loss of the 

ability to manage my finances. 1 2 3 4 1 2 3 4

4. Prepare financially for disasters. 1 2 3 4 1 2 3 4

5. Find other helpful resources for 

managing my money.

1 2 3 4 1 2 3 4
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Evaluation Form 

This evaluation will enable you to assess your observations of the Money Smart for Older 

Adults module. Please indicate the degree to which you agree with each statement by circling 

the appropriate number.

1. Overall, I felt the module was:

Strongly DisagreeDisagreeNeutralAgreeStrongly Agree

[ ] Excellent

[ ] Very Good

[ ] Good

[ ] Fair

[ ] Poor

2. I achieved the training objectives. 1 2 3 4 5

3. The instructions were clear and easy to follow. 1 2 3 4 5

4. The slides were clear. 1 2 3 4 5

5. The slides enhanced my learning. 1 2 3 4 5

6. The time allocation was correct for this module. 1 2 3 4 5

7. The module included sufficient examples and exercises so 

that I will be able to apply these new skills.

1 2 3 4 5

8. The instructor was knowledgeable and well-prepared. 1 2 3 4 5

9. The worksheets are valuable. 1 2 3 4 5

10.I will use the worksheets again. 1 2 3 4 5

11.The participants had ample opportunity to exchange 

experiences and ideas. 

1 2 3 4 5

12.My knowledge/skill level of the subject matter before 

taking the module.

13.My knowledge/skill level of the subject matter upon 

completion of the module.

None Advanced

1 2 3 4 5

1 2 3 4 5
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14.Name of Instructor:

Instructor Rating:

Please use the response scale and circle the appropriate 

number. 

Response Scale:

5 Excellent

4 Very Good

3 Good

2 Fair

1 Poor

Objectives were clear & attainable 1 2 3 4 5

Made the subject understandable 1 2 3 4 5

Encouraged questions 1 2 3 4 5

Had technical knowledge 1 2 3 4 5

What was the most useful part of the training? 

_____________________________________________________________________________

_____________________________________________________________________________

_____________________________________________________________________________

_____________________________________________________________________________

What was the least useful part of the training and how could it be improved?

_____________________________________________________________________________

_____________________________________________________________________________

_____________________________________________________________________________

_____________________________________________________________________________
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Glossary

Adult Protective Services (APS): A [state or local] agency that investigates abuse, neglect or 

exploitation of older adults or younger adults who have disabilities.

Affinity Fraud: A type of fraud that targets members of an identifiable group, such as a 

religious organization, ethnic group, older adults, or professional groups.

Agent: A person to whom you grant authority to act in your place.

Annuity: A type of investment offered by insurance companies, or by other financial 

institutions acting on behalf of insurance companies. Annuities allow your money to grow taxdeferred until you withdraw it. The insurer agrees to make periodic payments to you for a set 

period of time. Annuities are complex investments with a variety of structures. They are not 

appropriate for many people in or near retirement.

Variable Annuity: An insurance contract that invests your premium in various mutual fundlike investments.

Direct Deposit: An electronic method for transferring and depositing money directly into your 

account.

Direct Express Debit Card: A debit card that allows you to access your federal benefits 

without a bank account. Your federal benefits payment is deposited to your Direct Express® 

card account on your payment day. You can use the card to make purchases, pay bills or get 

cash.

Elder Financial Exploitation: An act of using an older adult’s money or assets contrary to his 

or her wishes, needs, or best interests for the abuser’s personal gain.

Electronic Transfer Account (ETA): A low-cost account that allows recipients to receive their 

federal payments electronically.

Fiduciary: A person who manages the assets for the benefit of another person rather than for 

his or her own profit.

Federal Deposit Insurance Corporation (FDIC) Deposit Insurance: Insurance that protects

your money if the bank fails. However, FDIC does not insure non-deposit investment products, 

including: stocks, bonds, mutual funds, and annuities.

Fraud: A type of illegal act involving the obtaining of something of value through willful 

misrepresentation.
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Grandparent Scam: A scam whereby a caller pretends to be a relative in need of immediate 

funds to deal with an emergency. The caller may also represent themselves as a hospital 

employee, law enforcement officer, or attorney.

Identity Theft: A fraud committed or attempted using the identifying information of another 

person without authority.

Older Adult: Someone age 62 or older.

Older Americans Act: Legislation initially passed in 1965, established authority for grants to 

States for community planning and social services, research and development projects, and 

personnel training in the field of aging. It established the Administration on Aging (AoA) to 

administer the newly created grant programs. Today it authorizes a wide array of service 

programs through a national network of 56 State agencies on aging, 629 area agencies on aging, 

nearly 20,000 service providers, 244 Tribal organizations, and 2 Native Hawaiian organizations 

representing 400 Tribes.

Pharming: When criminals seek to obtain personal or private information by making fake 

websites appear legitimate.

Phishing: When criminals send out unsolicited emails that appear to be from a legitimate 

source in an attempt to trick you into divulging personal information. 

Ponzi Scheme: Also called a "pyramid" scheme, the scam artists promise high returns and use 

the money of some investors to pay off other investors.

Power of Attorney: A power of attorney (POA) is a legal document that allows someone to act 

on your behalf. 

Durable Power of Attorney: A power of attorney (POA) that remains in effect even if you 

become incompetent.

Privacy Notices: These notices explain how the company handles and shares your personal 

financial information. You will usually receive a privacy notice when you open an account or 

become a customer of a financial company, once a year after opening an account, and any time 

the financial company changes its privacy policy.

Promissory Note: A promissory note is a form of debt – similar to a loan or an IOU – that a 

company may issue to raise money.

Reverse Mortgage: A special type of loan that allows homeowners age 62 and older to borrow 

against the equity in their homes.
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Revocable Trust Account: A deposit account held as a payable on death (POD) or in trust for 

(ITF) account, or one that is established in the name of a formal revocable trust (also known as 

a living or family trust account). 

Scam: A confidence trick, confidence game, or con for short, is an attempt to intentionally 

mislead a person or persons usually with the goal of financial or other gain.

Spam: Unsolicited commercial email (UCE)

Surrender Charge: A fee you incur when you sell, or cancel, certain types of investments or 

annuity policies.
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For Further Information

Consumer Financial Protection Bureau (CFPB)

www.consumerfinance.gov

1-855-411-CFPB (2372)

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) 

created the Consumer Financial Protection Bureau to make markets for consumer financial 

products and services work for Americans. The Bureau works to fulfill this mission by making 

rules more effective, by consistently and fairly enforcing those rules, and by empowering 

consumers to take more control over their economic lives.

The Office for Older Americans is a special office within the CFPB that is dedicated to helping 

Americans age 62 and older make sound financial decisions.

The Consumer Financial Protection Bureau (CFPB) offers several resources: 

• Print brochures on topics such as reverse mortgages, at 

http://promotions.usa.gov/cfpbpubs.html

• An online resource called ASK CFPB, which contains authoritative, unbiased, 

understandable answers to commonly-asked consumer questions with a special section 

for older Americans, at http://www.consumerfinance.gov/askcfpb/

• A consumer complaint line for financial products including mortgages, car loans,

consumer loans, bank accounts and services, student loans and credit reporting. 

Complaints can be filed online at www.consumerfinance.gov/complaint/ or by calling

1-855-411-CFPB (2372)
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Federal Deposit Insurance Corporation (FDIC) 

www.fdic.gov/consumers

Division of Depositor & Consumer Protection 

2345 Grand Boulevard, Suite 1200 

Kansas City, Missouri 64108 

1-877-ASK-FDIC (275-3342) 

Email: consumeralerts@fdic.gov 

Visit the FDIC’s website for additional information and resources on consumer issues. 

Additional modules of the Money Smart financial education program are available online as 

computer based instruction. Enter Money Smart in the search field. The quarterly FDIC 

Consumer News provides practical hints and guidance on how to become a smarter, safer user 

of financial services. Also, the FDIC’s Consumer Response Center is responsible for: 

• Investigating all types of consumer complaints about FDIC-supervised institutions 

• Responding to consumer inquiries about consumer laws and regulations and banking 

practices 

Consumers should note that while the FDIC is responsible for insuring deposits in FDIC 

insured institutions, the bank itself may be chartered or supervised by other agencies (such 

as the Office of the Comptroller of the Currency or the Federal Reserve). To determine 

which regulator has jurisdiction over a particular banking institution, so you can submit a 

complaint to the correct agency, you can call the FDIC toll-free at 1-877-ASK-FDIC

(1-877-275-3342). For consumer protection issues, you can also contact the CFPB.

Federal Trade Commission

www.ftc.gov

1-877-FTC-HELP (382-4357)

www.ftc.gov/idtheft

1/877-IDTHEFT (438-4338)

The Federal Trade Commission (FTC) website offers practical information on a variety of 

consumer topics. Two brochures on identity theft are available online or in print: Taking 

Charge: What to do if Your Identity is Stolen and Identity Theft: What to Know, What to do. The 

FTC also provides guidance and information on how to select a contractor: Home Sweet Home 

Improvement.
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Elder Care Locator

www.eldercare.gov

1-800-677-1116

The Eldercare Locator, a public service of the Administration on Aging, U.S. Department of 

Health and Human Services, is a nationwide service that connects older adults and their 

caregivers with information on senior services. You can search for services by location or by 

topic.

Medicare

www.medicare.gov

1-800-MEDICARE (1-800-633-4227)

The official U.S. Government site for Medicare allows you to search for physicians and other 

health care providers that are enrolled in Medicare.

U.S. Department of Veterans Affairs

www.va.gov

1-800-827-1000

Look under Veterans Services for an online booklet describing the benefits that may be 

available. To find a list of accredited representatives, agents, and attorneys who can assist you 

in filing for benefits, visit www.va.gov/ogc/apps/accreditation/index.asp. 

National Center on Elder Abuse

http://ncea.aoa.gov/

The Administration on Aging sponsored website provides resources on elder abuse prevention, 

including information on reporting a suspected case of elder abuse.

National Association of Area Agencies on Aging (n4a)

www.n4a.org

This umbrella organization supports a national network of more than 600 area agencies on 

aging and nearly 250 Title VI Native American aging programs through advocacy, training, 

publications, and technical assistance. It administers the Eldercare Locator. 
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Financial Industry Regulatory Authority

www.finra.org

1-800 289-9999 (BrokerCheck Hotline)

Find out about the broker’s background via the (FINRA) BrokerCheck. Or call the FINRA 

BrokerCheck Hotline. Find out more about the use of senior designations or certifications at 

http://www.finra.org/Investors/ToolsCalculators/BrokerCheck/

OnGuardOnline.gov

www.onguardonline.gov

OnGuardOnline.gov is the federal government’s website to help you be safe, secure and 

responsible online. The FTC manages the site in partnership with 16 other federal agencies. Its 

resources include information on phishing available at

http://onguardonline.gov/articles/0003-phishing.
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Report Financial Exploitation

If someone is in immediate danger, dial 911 or your local police department.

Adult Protective Services

Telephone numbers vary by location

Visit www.eldercare.gov

or call for contact information for your area:

1-800-677-1116

A [state or local] government agency, generally a part of your county or state department of 

social services, that investigates abuse, neglect or exploitation of older adults, or younger adults 

who have disabilities. 

Federal Trade Commission

www.ftc.gov/idtheft

1/877-IDTHEFT (438-4338)

The FTC online toolkit includes a detailed guide for protecting your information, with 

instructions and sample letters to help identity theft victims ̶ Taking Charge: What to Do If 

Your Identity Is Stolen. An online complaint form is available directly at 

www.ftccomplaintassistant.gov.

Legal advice or representation. How can I find an attorney who specializes in elder law 

issues?

Federally funded legal assistance programs for people 60 and older (known as Title IIIB legal 

services programs) can provide legal assistance on issues such as income security, health care, 

long-term care, nutrition, housing, utilities, protective services, defense of guardianship, abuse, 

neglect, and age discrimination. Legal assistance is targeted towards older individuals in social 

and economic need. Each program has its own priorities and eligibility guidelines regarding 

case acceptance and areas of representation.

Your senior legal aid program may be located at your local legal services program. You can 

also find out about your local legal assistance programs by contacting your area agency on 

aging or www.eldercarelocator.gov. If you need a private attorney to assist you with making a 

power of attorney, trust, will or other advance planning tool, contact the lawyer referral service 

of your state bar association.
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Senior Medicare Patrol (SMP)

www.smpresource.org

1-877-808-2468

The SMP programs, also known as Senior Medicare Patrol programs, help Medicare and 

Medicaid beneficiaries avoid, detect, and prevent health care fraud. SMPs nationwide recruit 

and teach nearly 5,700 volunteers every year to help in this effort. Most SMP volunteers are 

both retired and Medicare beneficiaries and thus well-positioned to assist you. Visit the website 

above or call for more information or to get contact information for your state SMP. 

Social Security Administration

www.ssa.gov

Toll free customer service at 1-800-772-1213. Deaf or hearing-impaired individuals can call 

Social Security's TTY number at 1-800-325-0778.