Most people know Consumer Reports for its product tests and unwavering integrity. What most don't realize, however, is that it can also at the forefront of identifying critical trends. The November issue makes the point very well with its cover story on con artists preying on senior citizens (to the shameful tune of $3 billion a year).
Among the alarming statistics it shares:
• Approximately 1 in 5 seniors has been taken advantage of financially (2010 survey of seniors by the Investor Protection Trust)
• 4.7 percent of seniors reported that they had been financially (Journal of General Internal Medicine study). To put that in perspective, the researchers noted that if a disease struck the same percentage of Americans, "a public health crisis would be likely declared."
• Fraud complaints by individuals 60 and older rose at least 47 percent between 2012 and 2014 (The Federal Trade Commission)
The problem is only going to get worse as the population of elderly increases. Baby boomers are turning 65 at the rate of about 10,000 a day, with the Census Bureau estimating that nearly 20 percent of America will be 65 or more by 2030.
Consumer Reports covers the elder scam crisis with considerable restraint. Their cover story headline highlights the $3 billion estimate of money swindled from seniors annually, when there are estimates that say the actual number is ten times the amount. The magazine also features more than a half dozen seniors who bravely agreed to tell their heart-wrenching stories despite the embarrassment and shame they experienced.
Beth Baker, 87, is one of them. She received a call one day saying that her beloved grandson was in trouble in Peru and a lawyer representing him needed some money to get him out of jail. She ultimately sent $65,000 - most of her liquid savings -- to help her family member supposedly in need. The problem was that he was never in any trouble. She was swindled.
But the Consumer Reports story also features some unnamed heroes, like the bank manager who was suspicious as to why Baker applied for a $14,000 home equity loan when her house was already paid off. Baker confessed what the money was for and the manager convinced her she was being scammed. It's unfortunate the magazine didn't identify the bank or the manager, as they are worthy of recognition. It would be interesting to know if the manager was following guidelines issued by his bank or he or she acted on their own accord.
Also worth noting is that Green Dot, the nation's largest seller of prepaid debit cards, last year discontinued its MoneyPak product because it was a popular form of payment used in online scams, including two scams reported in the Consumer Reports story. Kudos to them for the bold move, which adversely affected its earnings and stock price.
More must be done to shut down scam artists who prey on the elderly. Unfortunately, as this article by David Segal in the New York Times makes clear, it's still too easy for them to dodge regulators and circumvent law enforcement actions. Perhaps we need something akin to Megan's Law for individuals convicted of scamming the elderly. It takes a person considerably lacking in morals to prey on seniors, particularly as the emotional and financial devastation wrought can often serve as a catalyst for degradation in health. Consumer Reports cites a 2009 study by the Chicago Health and Aging project that found older people who were subjected to abuse or neglect, including financial exploitation, were hospitalized at a higher rate than those who weren't victims.
With its November cover story, Consumer Reports dispenses considerable advice on how to prevent the elderly from getting scammed, and the counsel should be must reading for every adult with a parent, relative, or friend 60 or over. I'm not certain how magazines are awarded journalism prizes, but if highlighting a growing national epidemic with compassion and insight is among the deciding criteria, Consumer Reports' November issue certainly deserves the blue ribbon.