Retirement Savings Scams

Older Americans are increasingly being caught up in elaborate scams designed by perpetrators to drain them of their retirement savings, with the detail and scale of such scams sometimes requiring the intervention of federal law enforcement. Subjects of interviews were ensnared in scams that could be so elaborate it’s as if they were created in a writer’s room testing different plot devices. Scammers can impersonate government officials, tech support staff or love interests. They coach victims on how to sidestep fraud prevention measures at financial institutions, and they use manipulative psychological tactics — isolation, a sense of urgency or preying on people’s willingness to trust or connect — to keep the scam going.

Retirees have lost hundreds of thousands of dollars in retirement savings due to the persistent efforts of these bad actors. A gentleman lost this money over a period of only three months, spending just about every weekday doing the legwork and making withdrawals from his bank accounts as part of an intricate scam. He believed he was helping the feds safeguard his money and catch thieves who were after it. Such scammers are present in a variety of online areas, including dating websites, social media platforms, messaging apps and through the use of invasive, malicious software — just to name a few. The nature of these schemes makes it nearly impossible to recover the money, leaving victims with little recourse. The stolen funds are often whisked to overseas accounts or laundered through cryptocurrency wallets, which are quickly emptied. The losses are sometimes exacerbated by taxes. Withdrawals from retirement accounts — especially in such large amounts — can often come with a heavy tax bill that the victims have few resources to cover after being scammed.