NerdWallet's Smart Money Podcast
Swindled or Safe? Improve Your Scam Awareness and Protect Your Finances
Wed, 18 Dec 2024
Learn how financial scammers exploit emotions and how you can protect your finances from their latest tactics. How can you protect your money from online scams? What steps can you take to safeguard yourself from financial deception? Hosts Sean Pyles and Anna Helhoski delve into the harrowing tale of Judith, a 79-year-old who fell victim to a sophisticated scam that led to the loss of nearly $600,000. Joined by Michelle Singletary, a personal finance columnist for the Washington Post, they unravel the tactics scammers use to prey on emotions and trust, emphasizing the importance of awareness and empathy in scam prevention. Then, Sean and Anna break down recent financial headlines, including updates on the Federal Reserve's interest rate decisions, the Consumer Financial Protection Bureau's new rule on overdraft fees, and the halted merger between Albertsons and Kroger. We're off next week, but you can follow our latest coverage on NerdWallet's financial news hub: https://www.nerdwallet.com/h/news/financial-news In their conversation, the Nerds discuss: scam prevention, online scams, phone scams, scam awareness, financial fraud, scammer tactics, protecting your savings, scam victims, scammer manipulation, scam warning signs, elderly scam victims, scam support, scam protection tips, FBI impersonation scam, financial security, bank manager intervention, scam victim recovery, fraud prevention, scam prevention strategies, protecting retirement savings, scam red flags, scam recovery, scam education, online fraud, scam prevention awareness, and scam victim advocacy. To send the Nerds your money questions, call or text the Nerd hotline at 901-730-6373 or email [email protected]. Like what you hear? Please leave us a review and tell a friend.
Chapter 1: How can you protect your money from online scams?
Welcome to NerdWallet's Smart Money Podcast. I'm Sean Piles.
And I'm Anna Helhosky.
And this is our weekly money news roundup, where we break down the latest in the world of finance to help you be smarter with your money. We'll go deep into a single topic, then leave you with the latest money headlines. Today, we're talking about how to protect yourself and your money from the vicious world of online scams.
Only they're not just online anymore. They're on your phone. And if you think it can't happen to you because you're either too smart or too informed or too lucky, you're wrong. As has been proven time and time again when completely normal people have their life savings stripped away before they realize what's happening.
Today we're going to hear about one specific story that we read about in the Washington Post, a seven-part series about these types of fraud that is just a jaw-dropping read. It's called Scammed, and you should find it and absorb its implications.
We're joined by the author, Michelle Singletary, a personal finance columnist for The Washington Post. Michelle, thanks for joining us. Oh, thank you for having me. We're talking about a seven-part series, so you should check out the entire thing. But Michelle, if you could give us a condensed version of how this scam played out.
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Chapter 2: What happened to Judith, the scam victim?
Each part of the series deconstructs what happened. So part one is about this lovely, kind-hearted woman, Judith. who, when she was 79, got a couple of calls from the Rockville Police Department, which is where she lives in Maryland. The first call, she thought, oh, I don't know what this is. And then they called again.
And on her way to drop her husband off for a doctor's appointment, she thought to herself, well, if the police is calling me this much, something's wrong. So she picked it up. And the person said, Rockville Police Department. She told them she'd been getting calls. And they said, let us transfer you to the chief of police. And this person said that she was under investigation for money laundering.
Her social security number had been used and connected to a drug cartel and that this is a very serious thing and she needed to take care of it. Then proceeded to say that they were referring the call or transferring it to the FBI. Now, all along the way, the caller ID said Rockville Police Department. It said the FBI.
So she had no reason to believe initially that she wasn't talking to agents of the FBI. Well, of course she wasn't.
And after about three months of long conversations, they asked this person who was pretending to be a real FBI agent with his resume and everything, persuaded her that she needed to move her money into some sort of government locker to protect it while they were pursuing the criminal case. And at the end of the day, over three months, nearly $600,000 of all of her retirement savings were stolen.
God, it's just a heartbreaking story. And as you mentioned in your piece, so often people who are scammed are hesitant to make their stories public. I'm wondering, how did you connect with Judith?
The first time she was interested in telling her story to help other folks. When you read the series, you'll find her life's work is working in the public service. She was a therapist. She worked with children and dementia patients. I mean, her life was helping other people.
When this happened to her, when she became a crime victim, she wanted to put the warning out that this could happen to anybody because this is a highly educated woman. She's 79, but all there, I mean, there's no mental incapacity at all. When I met her for the first time, it was really hard for her to share it again.
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Chapter 3: What tactics do scammers use to manipulate victims?
Over multiple interviews, going there, spending time with her, spending time with her daughter, she was able to unpack everything. She gave me access to everything, every document, every email, photos of the bundles of money taken from her and drop-offs. She just gave me complete access. And I think she opened up because the questions that I asked, and this is why the series is different.
At no point did I tell her this red flag. Did you not notice this? Did you not see this? I just said, tell me what happened.
What was it that convinced her that the con was real? What about this particular type of scam makes it so believable?
The caller ID appeared to come from the FBI. And the person impersonated an FBI agent who had been working in the criminal crime area of money laundering and things like that. So when the person told her the agent's name, Wayne A. Jacobs, she looked him up. There's his resume. There's said he worked in Washington. The person had said, oh, I work in Washington.
All the details panned out when she did online research. She thought, well, this is the agent. And then they sent her documents that looked official. When you microscopically look at it, there's some tell signs. But for example, when the scam was finally revealed to her, it was because a Maryland investigator, fraud investigator said, hey, look at the email address.
It said WayneAJacobs at USA.com. She said, well, how would I know that? How would I know that it should have said FBI.gov?
Michelle, you wrote about how the scammer preyed on Judith's emotions. Fear is a big one, but there's also a bonding element to their tactics too. Can you tell us more about that?
These are long con games. He was on the phone with her for about three months, twice a day at 9 a.m. in the morning, 6 p.m. at night, talking to her. So initially, there wasn't an ask for money. It was like telling her about the criminal activity, that they were selling drugs to children, that we've been trying to get this drug cartel. And it was a real drug cartel. She looked that up.
There is a case against them. So they fed her all this information that is real, even though they weren't. That's how they sort of laid the groundwork. So she's telling them about her life. This scam was targeted specifically to her because they had enough information about her that they go, oh, I see that you were a therapist. I see that you worked here. It's all true.
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Chapter 4: How did Judith find out she was scammed?
The reason why we see more stories about the elderly population is because they've got the money. They've got big retirement accounts and the scammers know that. So they are targeting them, particularly not because of their age, but because they've got the money. They spent life careers saving up.
And so the score, if you will, is larger with them than with a young adult who may only have, you know, a couple thousand dollars. And that's why we see the large dollar amounts in the elderly community. So we have to change our language of that. It's not because they're old. It's because they got the money that they are targeting.
Yeah. So Michelle, this is such a cautionary tale, and there are likely many thousands of them. When you're facing such an organized, persistent opponent, what are the top things that you can and should do to safeguard yourself from these types of scams?
It's going to take efforts from everybody, the police, the technology companies. There's got to be more effort to prevent spoofing of calls so people can't change ID numbers and show that they're from the Rockville Police Department when it really is a call center in India.
The police need more resources to be able to go out to the communities for fraud prevention, but also put people on these cases because we tell people to file a police report. But that doesn't necessarily mean somebody is going to be assigned to look into that. It just helps the data collection more than anything. And I think in terms of prevention, we have to be as persistent as the scammers.
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Chapter 5: What role did the bank manager play in stopping the scam?
Chapter 6: Why is empathy important when discussing scam victims?
That's correct. Lots of times the money's in cash or gold or things that are not traceable. Oddly enough, they are in some cases able to track it if cryptocurrency was used. But if it's cash or gold bars, the money's gone. And in her case... It's very unlikely. The case is still pending.
Sometimes if they are able to catch the syndicate and freeze bank accounts and identify victims, some money can be returned, but often not. They never see this money again.
Now, Judith is older, and there's this perception that seniors are more vulnerable. I myself saw my grandmother scammed out of quite a bit of money several years ago. They told her that they had my brother held hostage in Canada. But the Federal Trade Commission says people in their 20s are scammed at higher rates than those in older age brackets. That's exactly right.
It irritates me so because they make it sound like these feeble old people sitting by their phone answering calls for scammers. That's just not how it happens at all. Young adults, I think, is twice as likely to fall for or be victimized in a scam because they're online more, they're searching for jobs, the avenues where the scammers are, young adults are, right?
The reason why we see more stories about the elderly population is because they've got the money. They've got big retirement accounts and the scammers know that. So they are targeting them, particularly not because of their age, but because they've got the money. They spent life careers saving up.
And so the score, if you will, is larger with them than with a young adult who may only have, you know, a couple thousand dollars. And that's why we see the large dollar amounts in the elderly community. So we have to change our language of that. It's not because they're old. It's because they got the money that they are targeting.
Yeah. So Michelle, this is such a cautionary tale, and there are likely many thousands of them. When you're facing such an organized, persistent opponent, what are the top things that you can and should do to safeguard yourself from these types of scams?
It's going to take efforts from everybody, the police, the technology companies. There's got to be more effort to prevent spoofing of calls so people can't change ID numbers and show that they're from the Rockville Police Department when it really is a call center in India.
The police need more resources to be able to go out to the communities for fraud prevention, but also put people on these cases because we tell people to file a police report. But that doesn't necessarily mean somebody is going to be assigned to look into that. It just helps the data collection more than anything. And I think in terms of prevention, we have to be as persistent as the scammers.
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Chapter 7: What can we learn from Judith's story about scam awareness?
And with that said, until next time, turn to the nerds.