A few weeks ago, MBPD Sgt. Tim Zinns participated in a seminar with the residents of the Manhattan Senior Villas. He wanted to help the seniors become more aware of the many scams that are increasingly targeting older folks, especially those living in senior communities. It turned out the residents were already painfully aware they’d become targets.
“Every single one of them said, ‘Oh yes, we get those phone calls several times a day trying to get us to buy gift cards, or with the tax season, someone calling saying if you don’t send $2,500 via Western Union, the FBI is going to come out and arrest you.’”
The very next weekend Zins’ elderly father received a call.
“Hey Jerry, remember me?” the caller asked. “I’m your old friend from high school.”
The man said he was in trouble and needed $2,500 to get out of jail. But Zins’ father was having none of it.
“He knew my dad’s name and was trying to bait him…My dad is elderly but he’s still very sharp,” Zins said. “He said, ‘I don’t know who you are,’ and hung up the phone.”
Many seniors, however, don’t hang up the phone. According to a 2017 study published in the American Journal of Public Health, one in 18 older Americans fall victim to financial fraud every year, a figure that excludes those who are financially abused by actual friends or relatives. Sometimes scammers will even pose as police.
“We just want people to know that neither the police department or the federal government will ever call and demand money from anyone, or threaten anybody over the phone with arrest,” Zins said. “If they have any question about somebody who is calling, anything they don’t feel comfortable about, they should always hang up the phone and call the police department.”
Frauds perpetrated on seniors are various in nature, including everything from scammers posing as Medicare representatives to obtain confidential information to fake telemarketing calls; seniors as a group, according to the National Council on Aging, make twice as many purchases over the phone than the national average. A particularly prevalent scheme is the so-called “grandparent scam” in which a caller poses as a grandkid in need.
“The grandparent scam is so simple and so devious because it uses one of older adults’ most reliable assets, their hearts,” said an NCA report.
The agency calls frauds targeting older Americans “the crime of the 21st Century,” due to the aging Baby Boom population and its congruence with the increasing ease of moving money electronically. It is this latter factor that has led to what many investigators believe is the area most increasingly the focus of scam artists — real estate transactions.
Zins recently attended an FBI training regarding this area of fraud, which he said is particularly relevant in areas such as Manhattan Beach, where so many high-value real estate transactions occur.
“One of the biggest scams going on now is the real estate scam where they are obtaining Realtors’ client’s email addresses, and somehow they monitor the transactions of pending houses for sale, and when it comes down to wiring the money towards the end of escrow, they send the victim an email that looks exactly like a Realtor’s email. ‘Oh, there’s been a change in plan, you need to write money to this other account,’” Zins said. “We are talking about big money. These houses in the South Bay are worth a lot of money, so people are wiring a lot of money to put down payments down on a house. Some are losing between $100,000 and $500,000 on these scams.”
Zins said that even the FBI cannot recover such sums unless they catch the fraud occurring before or during the transfer.
“Once that money is gone, it’s gone — there’s nothing MBPD can do about it, and nothing the Federal Bureau of Investigation can do about it.”
Ed Navarro is considered a go-to real estate fraud investigator in law enforcement circles. Navarro worked in the real estate industry for 30 years as an escrow officer. Ten years ago, deputies from the LA County Sheriff’s Department were investigating a fraudulent transaction Navarro’s company had been involved with in which Wells Fargo had broken protocol and changed the customer’s sending mortgage broker without notifying him. When Navarro helped the investigators better understand what had occurred, they realized his knowledge of the industry would be useful in other investigations. He’s worked on a special real estate detail with LACSD ever since.
“I’ve had friends in law enforcement for years and I always preached that real estate would be the next big fraud coming around, because the dollars are there,” Navarro said.
Navarro said matters were made much worse a few years ago when the California Association of Realtors changed the default setting for transactions from cashier’s checks to the electronic transferring of funds. He said this, combined with the fact that people generally only do a few real estate transactions in their lifetimes and thus may not recognize irregularities, has made his prophecy come true — real estate fraud has become rampant.
“It turned into the perfect storm,” Navarro said. “You have someone who doesn’t do this kind of transaction very often, and everything is new to them, so the possibility of fraud is exponential.”
Navarro has worked on cases in which people have lost as much as $850,000. He said that every link of the chain in real estate transactions is under siege from scammers.
“Buyer, seller, everyone involved, because every aspect of real estate transactions is being attacked,” he said. “Not only the buyer; we are talking seller proceeds.”
Zins and Navarro both urged anyone with any suspicions to pick up the phone and either contact police or, in the case of real estate fraud, the other parties in the transaction. The way to defend oneself in both areas of fraud — real estate and senior scams — often comes down to making a single phone call.
“Trust,” Navarro said, “but verify.”
