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Grandparent Scams

Written by Clint Turpen. Posted in Uncategorized

Published on August 23, 2011 with No Comments

by Clint Turpen

A common scam that appears to be increasing in frequency is a swindle often known as the “Grandparent Scam.”

In its basic form, the scam begins with a phone call to an elderly person. The con artist will start with an open-ended greeting like, “Grandma? It’s me,” and let the victim fill in details such as a name and other information.

Once the thief has established this connection, they will tell the victim they are in some kind of trouble — the most common stories are is that the “grandchild” was in an auto accident or has been put in jail while traveling in Canada or Mexico. In other cases, the caller will make no pretense of actually being the grandchild, but will claim to be calling from a hospital or police station, telling victims the grandchild has been seriously injured in an accident while traveling or has been arrested.

Regardless of the particular story, the next step is always identical: the grandchild needs the grandparent to wire a significant amount of cash, usually a few thousand dollars. It is only after doing so that the victim realizes that they have been tricked.

This version of the scam uses a technique called “cold reading” in which the con artist supplies just enough general information to convince the victim of his or her alleged identity, and then letting the victim fill in the rest of the details. Cold reading is widely used by people who claim psychic powers (i.e., if you tell a middle-aged person, “I’m seeing the loss of an older person in your life, a father-figure, perhaps an uncle or grandparent, and I’m seeing a health problem in the chest or abdomen,” there is a good chance the statement will apply to the mark).

Traditional grandparent scammers also use the fact that older victims are more likely to have some hearing loss, which means the con artist doesn’t have to worry about their voice sounding like the grandchild’s. Victims also might not have heard from their grandchildren in several months, so they might be less able to recognize the “wrong” voice over the telephone.

However, there is a new version of the scam that’s making it a lot harder to tell who is a scammer and who really is a relative. These callers don’t use cold reading because they have already obtained large amounts of accurate information about whomever they are impersonating; they know the names of other family members, the name of their intended victims and other inside details. They’re also not limiting themselves to elderly victims.

It’s not entirely clear how con artists get this information, although social networking websites with loose privacy settings could be one method. Obituaries that appear in online editions of newspapers also can contain large amounts of family information.

The first step in preventing this scam is to know that it exists, and to inform others in your family. Make sure everyone knows that, if someone calls you and starts talking about being in jail or in a hospital and wants you to wire money, it is extremely likely to be a scam.

If you receive such a call, call the relative (or their parents) directly and ask if there’s any chance it’s real. Many instances of this scam have been averted by the question, “Is Johnny traveling in Mexico right now?” and its usual answer, “No, he’s asleep on the Barcalounger.”

You might consider having a pre-set “code” word or phrase so that, if a grandchild does call you in need of funds, you can verify that it’s actually them. You can also ask questions that only the actual person would know the answer to, but keep in mind that many people share almost everything on the Internet these days—the scammer might already know the names of a grandchild’s pets and other information.

Finally, always remember that, once you wire money to someone, there is essentially no way to get it back, and anyone calling and asking you to wire money is almost always going to turn out to be a crook. Never send money unless you can verify beyond doubt who they are, where they are and why they need it.

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About Clint Turpen

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All opinions, conclusions or recommendations expressed are solely those of the author and do not necessarily reflect the views of The Chronicle. Clint Turpen, marketing specialist at Regional Federal Credit Union, is a certified Identity Theft Risk Management Specialist. He is an author at Regional Federal Credit Union’s Fraud Prevention Unit Web site. For more information, visit www.fraudpreventionunit.org.

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