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Experts Share Latest Fraud-Fighting Tactics

Law enforcement officials answer questions and reveal trends

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Photo: Nick Ferrari Illustration: Matt Palizay

En español | We asked the people on the front lines of fighting fraud to tell us what the scammers are up to – and describe the latest efforts to stop them.

Stopping Fake Charities

Tracy S. Thorleifson, Attorney and charity-fraud expert, Federal Trade Commission

Q: You have been going after charity scammers for the FTC since 1994. What has changed in that time?

A: The phony sweepstakes that I investigated 20 years ago that were done by telemarketing might now be done online or via email. The investment scams from the ’80s were investing in precious metals or gems. These days they are investing in Bitcoin.

Q: What are the newest techniques that shady charities and fundraisers use to target older Americans?

A: Recently, we have seen a rise of telemarketing calls on behalf of political action committees that use soundboard technology [prerecorded messages played in a way that makes people believe that a real caller is on the other end of the telephone]. The calls sound just like the charitable-donation calls that you may have gotten before. They will make it sound like you are giving a donation to help support the police, firefighters, veterans — whoever — but it turns out the donation is going to a PAC.

Q: Is the FTC using any modern or high-tech methods to investigate fraud?

A: Yes. Tax-exempt organizations have to file 990s [IRS tax forms]. Charities are also required to register and file reports in about 40 states. Much of the information that states collect is available online. That has absolutely made our job easier. With a little bit of poking around, we can pull relevant information to help us assess what’s going on.   

Preventing Medicare Fraud

Matt Charette, Special agent in charge, Office of the Inspector General, U.S. Department of Health and Human Services

Q: What are the most recent schemes in health care fraud?

A: We all talk about health care fraud in dollars, but it has a personal effect, as well. For example, if a scammer were to use a beneficiary’s information to bill for an electric wheelchair today and if that beneficiary, God forbid, were to suffer a stroke next week and require the use of an electric wheelchair, Medicare wouldn’t pay because, according to its system, that patient already has that equipment.

Q: What steps are you able to take to combat that type of fraud?

A: We try to do prevention first. We always try to reinforce the idea that nothing is ever free. One of the places where scammers pick up information is health fairs. They urge folks, “Hey, come on over; get your free blood-pressure check.” And then they’re asked for a Medicare number. The minute you’re asked for your Medicare number, that should be a red flag to realize somebody’s going to bill something somewhere.

Q: How are you finding better ways to use data?

A: We use data to identify hot spots, where we see irregular billing. We’ve seen a decline in Medicare billings in hot spots where we’ve focused resources based on our data analysis. 

Working Together to Fight Scams

Judith Kozlowski, Elder-justice expert working with the U.S. Department of Justice’s Elder Justice Initiative

Q: Can you tell us about some of the latest approaches to combat schemes against older Americans?

A: I’m seeing much more interest in creating a multidisciplinary climate for helping older adults. The notion used to be that law enforcement could solve the problem, but that’s just never going to happen because things come too fast and furiously. Scammers come from different parts of the world and with tremendous sophistication.

Q: How do the different parties work together in a multidisciplinary way?

A: Law enforcement continues to act as the cop on the beat in every possible way, from the local police to the FBI. But law enforcement is just one piece. The financial services industry has a big role, as well. Their work is often to stop the assets from leaving the institution, whether it’s a securities firm, an investment advisory firm or a bank.

Q: What’s law enforcement doing on this front?

A: The International Association of Chiefs of Police just came out with some videos on elder abuse. That provides a new tool for police. They describe all different types of elder abuse and are perfect for roll call. There are more than 30,000 members of the IACP, so that should help. —Laura Petrecca

AARP’s Fraud Watch Network can help you spot and avoid scams. Sign up for free Watchdog Alerts, review our scam-tracking map, or call our toll-free fraud helpline at 877-908-3360 if you or a loved one suspect you’ve been a victim.