It turns out that many retired and older Americans were looking for love in some of the wrong places during those isolated and lonely days of the pandemic, and many continue to do so, according to a senior manager at RBC Wealth Management.
“People are just trying to make a connection with someone,” said Tara Ambrose, head of vulnerable client initiatives at RBC. But the information they share online is being used by perpetrators to scam them out of millions of dollars, she said.
Ambrose said scam artists will use online encounters to pick up on information such as political beliefs, religious beliefs and family tragedies and find ways to emotionally manipulate people. And while this can happen to anybody of any age, Ambrose said RBC has seen an increase in clients who are in their 60s and 70s who are being duped online. They are targeted, she said, because they are retired, and they are assumed to have money.
According to the Federal Trade Commission, romance scams targeting seniors surged during the first year of the pandemic, rising to $139 million in 2020 from $84 million in 2019. That is just what is reported, Ambrose noted, adding that many of the scams go unreported because people are embarrassed or ashamed to reveal that they have been victimized. She noted that women are more likely to report the crime.
RBC’s client risk prevention group saw a 40% jump in the number of overall scam and fraud referrals in 2021, and that was on top of a 54% increase in 2020, Ambrose noted. “Out of all the scams I’ve seen, romance scams have had some of the largest losses,” said Ambrose, who provides support, resources and education to advisors who suspect that their clients may be involved in a financial abusive plan or is experiencing cognitive decline.
Ambrose said the largest individual loss she has seen is $600,000, which involved a perpetrator who fed off his 60-year-old victim’s identity as a Christian and told her he wanted to convert to Christianity. “He manufactured a crisis that he was overseas and was arrested and his life was at stake,” she said, explaining that the client even thought she was dealing with negotiators to free the perpetrator. “And she was pretty adamant that she thought not only was she saving his life but that she was saving his soul." In the end , she said the client had to take out even more to pay taxes. “It gutted their financial plan and left them emotionally distraught.”
Ambrose said the scams happen on a regular basis, but people are reluctant to discuss what is going on.
One of the most common scenarios used by scam artists is that they are working overseas on an oil rig or working in the oil industry, she said. “This provides multitude of avenues for them to justify why they need big dollar amounts, why they are hard to reach, why they text at odd hours and why there is dangerous conditions,” she said.
Fraudsters will also impersonate military personnel or business people. They will say they are overseas in the military and that is why they cannot access funds, so they will ask for money and gift cards. “So, it’s usually some overseas type storylines,” she said.
“They build up an image of having money or success, they quickly build a strong emotional connection, they invest a lot of time and learn extensive amounts about their target, and they manufacture a crisis to ask for funds—most often with a promise to repay,” Ambrose said, noting that the crisis could be a medical emergency, equipment impound or legal trouble.