Skip to Content

FINRA and AARP Issue Study Highlighting Risk of Senior Investment Fraud

March 18, 2021 Blog

The Financial Industry Regulatory Authority (FINRA), in cooperation with AARP and Heart+Mind Strategies, recently released a report highlighting the risk of senior investment fraud. Specifically, the report focuses on the risk of seniors facing multiple fraudulent losses as they age—a problem which the report refers to as chronic fraud victimization. Sadly, as the report shows, this is a very real problem in our society, and many seniors and families will need to hire investment fraud attorneys to help them recover fraudulent investment losses.

Investment Fraud is a Prevalent (and Growing) Concern for Seniors and Their Families

As FINRA writes on its blog, “chronic fraud victimization may be a consequence of chronic susceptibility due to certain situational factors that disrupt judgment and derail good intentions. . . . However, chronic susceptibility can be challenging to identify and address.” One particular issue in this regard is that many seniors do not consider themselves to be at high risk for fraud. As a result, many seniors do not seek out or do not listen to, general warnings about the unique risks they face when investing. Given this issue, FINRA writes that “in-the-moment education and intervention opportunities could be more effective.”

The report discusses the risks facing senior investors in great detail. It breaks these risks down into four main categories:

  • Situational Factors – Isolation, loneliness, depression, mental degradation, and financial security are examples of situational factors that can increase senior investors’ risk of falling victim to fraudulent investment schemes.
  • Triggers – Triggers, which “kick start the fraud engagement,” can range from seniors’ requests for help to scammers’ promises of windfalls and financial independence.
  • Motivation – Scammers will frequently play on seniors’ motivations, such as the desire for companionship or control of their financial circumstances, to gain their trust and guide them into fraudulent “investment” opportunities.
  • Ability – Scammers will also often specifically target seniors who have exhibited the ability to pay (i.e. those in long-term care facilities). Another common tactic is for scammers to target seniors over whom they have the greatest ability to exert influence and control, such as those who are in cognitive decline.

Given these risks and the need for in-the-moment intervention, the report suggests that family and community members do what they can to help seniors understand the risks they are facing. Whenever possible loved ones should help seniors evaluate investment opportunities and identify red flags for fraud. While these discussions can be difficult to have, they are important, and helping seniors understand their risks – rather than telling them what to do (or not do) – can be an effective approach in many cases.

Of course, in some cases, it will be too late. When a senior investor falls victim to fraud, reacting promptly can be critical for preserving any available opportunities to recover the senior’s fraudulent losses. If you have any concerns about senior investment fraud, we encourage you to contact us right away for a free and confidential consultation.

Speak with an Investment Fraud Attorney at Zamansky LLC

Do you have questions or concerns about senior investment fraud? If so, one of our experienced investment fraud attorneys will be happy to speak with you in confidence. To schedule a free consultation as soon as possible, please call 212-742-1414 or tell us how we can reach you online today.

Client Reviews

“Jake Zamasky and his colleagues represented me in a FINRA arbitration case against a large multinational bank and succeeded in obtaining an award for the full amount of my investment losses. I would highly recommend the Zamansky firm for their experience in securities litigation, their level of detailed research and case preparation, and their ability to effectively fight for what’s right.”

Richard R.

“Throughout my entire case, Jake Zamansky was incredibly responsive and spent time walking me through each step of the process. He is professional and worked with my challenging schedule, even meeting with me nights and on weekends. He knew exactly which turn to take when it came to my case and yet was respectful of any decisions I wanted to make resulting in a positive outcome.”

Donald A.

“Jake Zamansky and his firm represented me in a FINRA arbitration case to recover investment losses. Jake and his team were very professional and worked very hard preparing for trial and then reaching a substantial settlement of our case. I would highly recommend them.”

William E.

“Jake Zamansky represented me in a FINRA arbitration case which allowed me to recover a substantial portion of investment losses. He is truly an expert in this space and I would highly recommend him to those investors who may have been been a victim of investment fraud.”

Chris K.

“Jake and his team did a great job communicating with me throughout the process of my lawsuit. I would recommend him to anyone looking to sue UBS for unethical practices.”

Mike A.
View More