A few years ago, Mabel Fielding received an unusual phone call.
A man purporting to be her grandson said he had ended up in jail after attending a wedding “down east somewhere” and needed her to send him money right away.
The 88-year-old Hanna, Alta., woman says she didn’t question his story, since she has a grandson who works as a wedding photographer on weekends.
“They had me down so pat,” she said. “Everything just fell in, especially when they said they were at a wedding and all this and that.”
Ms. Fielding rushed to the bank to send the money, but a teller warned her there was a scam going around. Fraudsters were calling up seniors, pretending to be their grandkids and asking for large sums of money to get them out of trouble.
“I should have said, ‘Well, which grandson are you?’” said Ms. Fielding, who said her next stop after the bank was the nearby RCMP detachment.
Not too long after that incident, Ms. Fielding received a similar phone call with a similar story, this time from a phony granddaughter.
“Now I’ll be a little bit more on the alert,” she said. “But when you have grandchildren you’re always trying to help them out – maybe too much.”
While Ms. Fielding was almost the victim of fraud at the hands of fake family members, seniors are all too frequently scammed by their real kin.
Les Kotzer, a Toronto-area estate lawyer, has seen his share of unscrupulous children taking advantage of their aging parents, and he and fellow lawyer Barry Fish have compiled their stories in their book, Where There’s an Inheritance …: Stories from Inside the World of Two Wills Lawyers.
At the heart of the problem is the fact that baby boomers are so loaded with debt, he said. On the flipside, their Depression-era parents likely scrimped and saved their whole lives, accumulating big nest eggs by the time they reached old age.
Any loans parents make to their kids should be well documented, Mr. Kotzer said. He knows of one woman who let her son and daughter borrow a total of $250,000. When her husband died and she needed the money, the kids refused to pay it back, saying they thought it was a gift.
Mr. Kotzer also warned against ceding control of major assets to others. Another woman he knows put her house in joint-name with her son in order to avoid probate when she died. When her son filed for bankruptcy and creditors came knocking, she suffered the consequences.
“Be very cautious of giving up control to your children,” he said.
The same goes for wills. When he reviews wills for clients, Mr. Kotzer never allows their children to be in the same room. He said it’s important for an independent third party to have a look, and that parents should be wary of letting their kids write their wills for them.
“They’re just ticking time bombs sitting in somebody’s safety deposit box,” Mr. Kotzer said.
Catherine Fallon, an outreach worker with the Calgary Seniors’ Resource Society, has also come across cases of financial elder abuse.
The society helped one woman who took out $60,000 on a line of credit, ostensibly to support her live-in grandson through university. After a while, the woman began to ask questions.
“She did actually find out that her grandson was not using the money for his university studies, but he was actually using it to continue his drug habit,” Ms. Fallon said. The woman was never able to recover the money.
Seniors who are approached for money, whether it’s from family members or from scam artists on the phone, should pay attention to gut feelings, Ms. Fallon said.
“If you just feel that it’s all a rush or instinct is telling you you’re not quite happy about this, it could be kind of a red flag to question that and stand back and say ‘Well, I’m not signing anything right now. I’m going to take this information and consider it,’” Ms. Fallon said.
Often seniors are more vulnerable because they’re at home more often during the day, are more isolated and likely have a lot of cash available, Ms. Fallon said.
Lorinda Brinton, senior adviser of investor education for the Alberta Securities Commission (ASC), said roughly a third of Canadians have been approached with investment “opportunities” that turn out to be scams.
“Although anyone can be a victim, if seniors lose their money, they have less time to recover financially,” Ms. Brinton said.
The three most common ways the fraudsters make the pitch is through cold calls over the phone, through a group of family and friends potential victims know and trust, and through advertising on TV, radio, newspapers or the Internet.
The ASC and other securities regulators across the country have resources to help Canadians research investment pitches to make sure the people pushing them are properly registered, and to check out whether any enforcement action has been taken against them.
“It’s really important that anyone who’s been approached, or been a victim of fraud, contact their local securities commission to report it,” Ms. Brinton said.