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Collaboration Needed to Tackle Fraud Crisis, AARP Experts Tell Congress
Older adults lost $3.4 billion to fraud last year, but crimes often go unreported
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The recent growth in fraud has been “meteoric,” and government, industry and advocates must work together to better protect consumers and support victims, AARP fraud expert Kathy Stokes told Capitol Hill lawmakers on Thursday.
When considering fraud that goes unreported, the Federal Trade Commission estimated the cost of fraud at $137 billion in 2022, Stokes testified before the U.S. Senate Special Committee on Aging. That is far higher than the $9 billion in losses reported that year.
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While data suggests that younger adults report fraud theft more often than older victims, the financial impact on older adults “can be catastrophic,” said Stokes, director of fraud prevention for the AARP Fraud Watch Network. Criminals defrauded Americans 60 and older out of $3.4 billion in 2023, according to FBI figures.
“These victims are financially ruined. They experience emotional and health impacts often,” she said. “Their families are torn apart, and many once-financially secure, hardworking Americans are left to rely on government safety nets.”
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Technology makes it easier for criminals
Stokes echoed concerns shared in testimony last week by Amy Nofziger, the AARP Fraud Watch Network’s director of victim support.
Nofziger, in a Sept. 12 hearing before the U.S. Senate Committee on Banking, Housing and Urban Affairs, said technology is making it easier for criminals to prey on older adults.
“It operates 24/7 in our homes and through these devices that we carry in our pockets,” Nofziger said.
One of the biggest impacts is the speed at which criminals can access people’s money. Cryptocurrency ATMs, for example, are increasingly used as a payment method of choice for criminals because they offer a quick and usually irreversible way to get their hands on someone’s cash..
Nofziger said the financial devastation is only part of the story. Through her work with the AARP Fraud Watch Network Helpline, which provides support to victims, Nofziger told lawmakers she has witnessed the emotional and physical toll scams and fraud can have on older adults and their families. She shared the story of a healthy woman who became ill and died four months after she learned she lost her life savings in a romance scam.
The helpline fielded more than 100,000 calls last year, most often reporting identity theft, business impostors, tech support scams, fraudulent sales and fake romances. Most victims said criminals reached out through a phone call, but other methods included email, text and social media.
“It is a tragic fact that these criminals wreak havoc and can drive individuals to premature death or even suicide,” Nofziger told the panel.
Collaboration, compassion needed
Both Stokes and Nofziger called for a collaborative approach to combating fraud — one that brings together victim service providers, financial industry players, and regulatory and law enforcement agencies.
Lawmakers can help by providing resources for law enforcement, passing legislation to limit the damage of crypto ATMs, and reinstating the casualty loss deduction so victims aren’t taxed on stolen assets, Stokes said.
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Nofziger, in her written testimony, stressed that victims need compassion and support to encourage them to report these crimes. Many are reluctant to do so, she said, because of stigma and shame.
“Addressing fraud requires more than piecemeal solutions,” she wrote. “It demands a holistic and coordinated approach.”
Watch recordings of the Senate Aging Committee and Senate Banking Committee hearings, and visit our Fraud Resource Center to stay ahead of the latest scams.
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