Investment Scams Targeting Seniors in Social Isolation During the COVID-19 Pandemic
The Financial Industry Regulatory Authority (FINRA) and the U.S. Securities and Exchange Commission (SEC) regularly issue alerts warning of investment scams targeting seniors. Sadly, unscrupulous brokers, advisors and scam artists tend to target those who are most vulnerable, and this includes senior citizens who might not necessarily have the tools and resources they need to protect themselves. As a securities litigation law firm, we frequently publish information about the risks of investment fraud targeting seniors as well, and we are committed to helping those who fall victim to all forms of fraud.
Social Isolation and Internet Usage Both Contribute to Investment Fraud Risk During the COVID-19 Pandemic
Recently, FINRA published an Investor Insight warning of the risk of investment fraud targeting seniors who are in social isolation due to the COVID-19 pandemic. The article begins:
“Social isolation, whether voluntary or involuntary, has long been a leading factor contributing to the financial exploitation of older investors. The unprecedented quarantines to protect against the spread of the novel coronavirus have made many seniors more vulnerable to financial exploitation.”
The article goes on to examine research that has concluded that individuals who are isolated are at greater risk for falling for scams and making uninformed investment decisions. It also notes that many seniors who are staying isolated during the COVID-19 pandemic are relying on the internet for news and social engagement—and that this can also increase their risk of falling victim to investment fraud scams.
Tips for Avoiding Investment Fraud Scams During Times of Social Isolation
For those who have limited interaction with friends and family due to the risks associated with COVID-19 exposure, FINRA offers several tips for avoiding securities fraud scams. These tips include:
- “Ask for input from others.” While it is important to remain physically distant, seniors can (and should) seek advice over the phone, by video chat or via email prior to investing.
- “Do additional research before sending money.” Before investing, try to collect as much information as possible, and be wary of any investment offer that comes with limited information.
- “Focus on your financial health and literacy.” Never let anyone talk you into investing beyond your means or taking risks that would threaten your financial stability.
- “Knowledge is power.” When in doubt, ask for more information. The more you know, the better able you will be to make an informed decision.
- “Never be afraid to complain.” If you have concerns, talk to someone. Tell a friend or family member what is going on, or consult with one of the attorneys at our New York law firm.
FINRA’s Investor Insight provides a list of common warning signs and red flags for senior exploitation as well. It is worth a read if you have any questions or concerns about investing (whether for yourself or on behalf of an aging loved one) during the COVID-19 pandemic.
Zamansky LLC | A Securities Litigation Law Firm Committed to Protecting Vulnerable Investors
If you believe that you or a loved one may have fallen victim to investment fraud during the COVID-19 pandemic, we encourage you to contact us for a free, no-obligation consultation. To speak with one of our experienced attorneys in confidence, please call 212-742-1414 or tell us how we can help online today.