Scam Savvy 

By Ellen Mitchell, Newsday 

September 5, 2008

'They said, 'Don't worry.' They took me in a limo to their office. They said, 'Sign here, sign there,' and I did."

And that's how Priscila Nano, a 66-year-old divorcee, came to lose the house in Great Neck that she'd lived in and loved for 29 years.

Nano is not alone. Consumer Action, an advocacy group, reports that, while people older than 60 make up 15 percent of the U.S. population, they account for 30 percent of fraud victims.

The FBI warns that seniors are enticing targets because they are perceived as trusting people who often are sitting on financial nest eggs. In general, they also are more likely to be lonely, to have trouble recalling details of a scam and to be embarrassed to report a fraud, the FBI said.
In today's financial climate, home foreclosures, according to the FBI, have become particularly fertile ground for scammers who prey on seniors having difficulty making mortgage payments or obtaining a loan for home repairs. Then, too, myriad other scams target a vulnerable older population, namely: identity theft, credit-card fraud, health-care scams, insurance fraud, lottery fraud, investment fraud, lonely hearts con games and, finally, funeral and burial schemes.

In recent years, scammers have been going after younger people, experts say. Baby boomers, intent on both preserving their youth and increasing their retirement savings, make easy fodder for those offering everything from miracle wrinkle creams, according to the FBI, to get-rich-quick investment scams, according to the North American Securities Administrators Association, a self-regulatory body for the investment industry.

It's become popular for con artists to reach out to baby boomers with events such as "free-lunch seminars," offering a meal and an "expert" and investment tips, according to the Securities and Exchange Commission, which has been working to halt frauds targeting retirement investments.

Baby boomers, because they usually have some computer skills, also often are victimized by criminals using the Internet, according to the FBI, which finds that online scams such as phishing (attempts to withdraw private information, usually for purposes of identity theft) and e-mail scamming are on the increase.

Nano typifies the senior mortgage scam victim, authorities say. Following her divorce, she was living alone and on the brink of foreclosure in 2004. A come-on letter from someone purporting to be a mortgage broker and offering to help her refinance captured her eye.

"They said they could get me good credit. It sounded good. I agreed," Nano said. It took only an hour for Nano to unknowingly sign away the deed to her house, which ultimately did go into foreclosure anyway when the new owner defaulted. Forced out of her home, Nano now lives nearby.

The mother of three adult children, Nano did not tell her offspring of her mounting financial difficulties because "they have their own problems; this was my problem."

Helping save the day

Attorneys Douglas Good and Jennifer Hillman of the Uniondale firm Ruskin, Moscou Faltischek worked pro bono to arrange a settlement for Nano in which she eventually got back most of the value of her home. Additionally, the "mortgage broker" who scammed Nano has been told by the courts to pay her a $3.5 million judgment, although he has few documented assets.

"We don't know where he is," added Hillman. "We hope Priscila will see some of that money, but the reality is, it's unlikely."

Artee McKoy, 94, had two homes stolen "out from under him," according to Queens District Attorney Richard Brown. The daughter of an old friend of McKoy's, Alexandra Gilmore, 36, formerly of Massapequa, allegedly worked her way into the elderly widower's confidence and then, through forgery and other means, worked to steal both the Jamaica home in which he then lived alone and a Bayside house he rented out for income. She also allegedly paid for travel, gifts and her child's dental work with McKoy's credit cards.

Both Gilmore and the "buyer," Rebecca Tharpe, 30, of Brentwood, to whom she allegedly sold McKoy's Jamaica house, are charged with multiple counts of grand larceny totaling $800,000 and are out on bail. They're further charged under the New York State Hate Crimes Act, which takes effect if the victim is targeted because he or she is age 60 or older.

"She wriggled her way in. She had him mind-boggled," said McKoy's daughter Mary Thompson, 67, of the alleged thief. "She came over every day. Then she took him to her house in Massapequa. I had to call the police. I couldn't even get in to clean." McKoy, who suffers from Alzheimer's, can only shake his head in vague comprehension of what is going on and say, "I worked very hard, two jobs night and day."

Ann Goldweber, director of the Elder Law Clinic at St. John's University School of Law, is working for convictions in McKoy's case and to have McKoy's finances made whole again.

"Our position is he should get back title to both homes and not be responsible for paying back the mortgage, which is held by HSBC. Anything McKoy signed should be voided because of his lack of competency," said Goldweber.

Chimney scams, and more Shysters are nothing new to elderly homeowners. "We've seen it time and again. For instance, there are the chimney companies ... they offer a $29 cleaning, but then the chimney requires a $2,000 liner, or the house will blow up," said Bob Emmons, chief of the Nassau District Attorney's Government/Consumer Frauds Bureau. "It's typical of the scams with the older population; it's all based on fear."

They are at the door offering to retile the roof, fix the chimney and, in general, rob a person's hard-earned dollars, according to Charles Gardner, recently retired director of Suffolk County's Office of Consumer Affairs.

"You have the sweet talkers and the fast talkers," said Gardner. The victims typically say, "Oh, he was so nice" or "Oh, he reminded me of my grandson."

"If it's all rush-rush that should raise a red flag," continued Gardner. "You don't have to do legitimate deals NOW, you don't have to sign NOW, you don't have to run to the bank for cash NOW. Seniors are basically nice people and they expect everyone else to be nice. We try to impress on seniors to be rude and say 'No.' Hang up the phone, close the door and, if the person won't leave, call the police."
"Suffolk County urges seniors who suspect something fishy to report it to Consumer Affairs," added Suffolk Executive Steve Levy. "They can do it anonymously if they're worried about giving their name as long as they provide a tip the county can follow up on."

Both counties are seeing an upswing of swindlers reaching out through the mailbox or the Internet.

For instance, the sweepstakes con: "They'll lure you with a letter saying you've won $100,000 and here's your first check for $10,000," said Emmons. "You put it in the bank and then they ask for a $5,000 processing fee. Their checks are counterfeit; they don't ultimately clear and the victim is out $5,000."

E-mails from Nigeria ...

It's not uncommon for unsolicited letters or e-mails to promise checks of $1 million or more if the recipient will assist in accessing a huge pot of money sitting somewhere just waiting to be picked up. Some unknown someone in some far-off country such as Nigeria hopes the gullible beneficiary will help by forwarding his bank account numbers and letting the con do the rest.

Emmons said senior citizens can fall for this even when they haven't entered any contest or been in touch with any far-off benefactor, even when the letters and e-mails are rife with misspellings and typographical errors. Victims often are too embarrassed or fearful of telling anyone they've been scammed. "They value their independence and worry that their family may decide they are no longer able to live alone," said Emmons. Recently, more and varied Internet scams are targeting baby boomers, said Diane Peress, chief of the Nassau District Attorney's Economic Crimes Bureau.

"Boomers are well educated; they feel they know more. So the newer scams are aimed at these people who think they've got everything figured out. Boomers will get a phishing e-mail and say to themselves ... 'I know better than that,' but then they'll respond anyway and make themselves vulnerable," said Peress.

Recently, Peress handled a headline-grabbing "sextortion" case. It was a blackmail scheme that lured middle-age people, particularly those going through a divorce and looking for love on the Internet. The e-mail chats eventually blossomed into sexual trysts, which were secretly videotaped. While Peress believes dozens were blackmailed with the tapes, only a few have been willing to come forward. And it's not only the healthy who are targeted.

An individual representing a far-less-than-forthcoming health insurance plan visited senior centers on Long Island and told people if they dropped their current plan and enrolled in Plan X, they would receive $400 in cash, according to Gwen O'Shea, president of the Health & Welfare Council of Long Island.

Those who made the change-over did not receive the promised $400. They also found themselves with a new and inadequate plan that provided fewer medical services at a higher monthly premium -- and without the medications their original plans had provided, according to O'Shea. "That, in a sense, is an out-and-out scam, because they were not being given the money," she said.

Bilking the unsuspecting

Through newsletters and seminars, the council attempts to alert seniors to the various ways in which the unscrupulous stand ready to bilk the unsuspecting. O'Shea says a call to any one of numerous nonprofit advocacy groups can help seniors navigate the system.

"There are no dumb questions," said O'Shea. "Just ask somebody for help in avoiding scams."

Sadly, even death can be fertile ground for the unscrupulous. The Federal Trade Commission warns that some funeral providers will foist overcharges and unnecessary services on grieving families. The FTC Funeral Rule states that families can choose only those goods and services they need, whether the arrangements are prepaid or made at the time of death.

Marli Delaney, a grandmother from Bayport, while not actually scammed, did have an unpleasant experience in carrying out her mother's final wishes.

Some years ago, Delaney's parents prepaid for a funeral plan through a funeral home in Suffolk County. But Delaney's mother died recently in Indiana and the family wanted her cremated there. Under the mistaken belief that all the details had to be handled by the funeral director from Suffolk, Delaney contacted him. First he tried to sell her numerous unneeded death certificates and then he called Indiana and bargained down the overall cost for the funeral arrangements without telling Delaney of the reduction in price.

It was only through their own efforts that the family learned their parents had prepaid substantially more than the final cost. They were then able to get a refund.

"The point," said Delaney, "is to know what you are signing and read all the small print." Gardner, formerly of Suffolk Consumer Affairs, suggests that adult children try to review their elderly parents' finances, accounts, expenditures and other important decisions on a monthly basis.

The best advice the experts say they can offer is to be aware and on defense against the many unscrupulous people who will go to great lengths to scam the vulnerable and the unsuspecting.

"The instinct to con people is alive and well," summed up Good, the attorney who helped Priscila Nano. "It's limited only by the human imagination."

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