Fraud involves deception resulting in injury to another. Most commonly fraud involves concealment, misrepresentation or nondisclosure of material facts. Statistically, seniors are defrauded more often than all other age groups combined. Some of the most common frauds and scams include:
Financial Advisors and Investment Scams: Watch out for investment seminars and advisors promising get-rich-quick schemes or guaranteed returns. Always research the investment before investing. Call the toll-free hotlines at the Department of Corporations 1-866-ASK-CORP or Seniors Against Investment Fraud 1-866-275-2677. Don’t be pressured into investing. Don’t invest without talking to a trusted friend. Don’t invest more than you can afford to lose.
Living Trust Mills: Watch out for “trust mill” marketing schemes. They usually start at a public seminar and “free” meal. Then they offer a very low price to prepare your living trust; which is really just a slick boilerplate binder with your name and data inserted. Finally, they reveal their real motive which is to sell you an annuity which will pay them thousands to tens of thousands of dollars in commissions. Don’t buy any annuity without investigating it. This means investigating the issuing company and comparing the terms of the annuity to at least three other companies. Always make sure you understand what commission the agent will be making on the sale and don’t buy without talking to a neutral financial advisor about your overall asset situation and whether an annuity should really be part of your overall investment portfolio.
Door-to-Door Solicitation: Almost anything can be sold by these salesmen and this alone should cause you to be very suspicious. Most cities require that they have a business license and you should ask to see one. The Better Business Bureau should also be consulted www.bbb.org as well as at least three past client references who you can meet and discuss the salesmen’s past work or services with.
Charitable Donation Scams: While we all want to contribute to worthwhile causes, sadly fake charities exist as well. Lawful charities must be registered with Attorney General’s Office and you can check by phoning them at 1-800-952-5210.
Medi-Cal Scams: The salesperson without any knowledge of the seniors' medical history or finances, convinces the senior that most likely they will need a nursing home and that the costs of the nursing home care will devour their life savings and result in them losing their home. To avoid this financial ruin the senior can pay a sizeable amount, typically $10,000-$20,000 and the salesperson will show them how to avoid financial ruin. After the senior has paid the salesperson they are advised to immediately give away their assets. This sudden poverty will then qualify them for Medi-Cal which will pay for their nursing home care when needed.
What the senior is not told is that the State of California is well aware of this scam and has financial look back provisions typically covering the 36 month period prior to Medi-Cal eligibility. Don’t fall for this fear-based sale and flat fee fraud. If you are sincerely interested in qualifying for Medi-Cal you can directly contact your local Med-Cal Office or contact the senior advocacy group CANHR 1-800-474-1116 to help you find a qualified attorney who can correctly qualify you for Medi-Cal or advise you as to other options.