By Jane McNamara, Elder Law Attorney 

Telemarketing, bogus sweepstakes, and mail fraud schemes cost Americans millions of dollars every year.  Older Americans are the prime targets.  Unscrupulous scam artists who use illegal come-ons, swindle our seniors and elderly out of their life savings every day.  Con artists set up phone rooms, called boiler rooms, where they promote crooked lotteries and sweepstakes schemes that ‘guarantee’ you’re a winner—for a fee.  They also promote bogus investment opportunities, seek contributions for charities that don’t exist, and seek money to “help stop the government from taking away rights belonging to seniors”.  They are slick and their materials look legitimate.  Seniors often find that they receive two or three calls a day from different telemarketers. Their tables are piled high with weekly mail claiming the good news of prizes won, in exchange for “handling fees” from $20 to $2,000.

The authorities work hard to target unscrupulous and fraudulent scams.  However, many boiler rooms close down, only to reopen under different names.  Although people age sixty and older account for twenty-six percent of all telemarketing fraud victims, sixty percent of people in that age group are victims of prize or sweepstakes fraud.  The actual figure is probably much higher since many victims of this type of fraud never report it to the authorities since they find it too embarrassing to admit they’ve been had.

One way to help protect elderly family members or other loved ones from unscrupulous con artists is to become aware of the types of scams being used.  These include phony sweepstakes, “guaranteed” prize schemes, some reverse mortgage offers, annuity scams, and bogus moneymaking and investment opportunities.  Be observant of frequent checks written to unknown parties or unexplained withdrawals in their bank or brokerage accounts.  

The Mail Fraud Statute of 1872 makes it a federal crime to use the U.S. Mail to further schemes that defraud.  In addition, the 1994 Omnibus Crime Bill added private carriers to the statute. Legitimate sweepstakes promotions allow anyone to enter and cannot require a purchase or fee as a condition of playing. “Free prize” promotions that ask for shipping or handling charges, registration fees, taxes, auditor’s expenses, or storage fees are against the law. Any high-pressure sales pitches from telephone callers requiring that you make a purchase or investment immediately are certainly bogus.  Don’t send money! Don’t allow a private courier to pick up a check! Don’t give out any personal information!  The best defense?  Hang up the phone and toss that mail!