WASHINGTON—Mail scams dressed up as sweepstakes and huge prize winnings are divesting unsuspecting people around the globe of at least $100 million per month. In the United States alone, people are scammed out of $30 million a month.
Angela Stonchik shared a heartbreaking, but common, story about her grandmother at a press conference at the Department of Justice on Feb. 22.
“I’m here because my grandmother was a victim of elder fraud. Her name was Marjory Jones. My family and I loved her very much,” Stonchik said.
“My grandmother was solicited non-stop by a fraudster that convinced her to invest in a phony investment scheme. She was told that she had won prizes in a sweepstakes and all she had to do was send in money to cover taxes and fees.”
This method is extremely common, according to Chief Postal Inspector Guy Cottrell.
“The letters come in attention-grabbing envelopes designed to lead a person to believe that they actually won,” he said on Feb. 22. All the winner has to do to claim their prize is pay a processing fee or a small amount of taxes.
However, no prize ever existed and the “winning” letter was one of millions of identical solicitations mailed to hundreds of thousands of victims around the world.
Cottrell said most people, once they’ve mailed in a small fee and receive nothing in return, realize they have been scammed.
“But some, especially our older Americans, they keep believing they won and they keep sending money,” he said. “The scammer then takes the relationship to the next level—increasing his or her grip on the victim while emotionally isolating them from their friends and family.”
Oftentimes victims are told not to share news about their winnings to their families—at least not until they receive their big check, he said.
Stonchik said the scammers’ calls to her grandmother’s home were relentless.
“My grandmother ultimately lost all of her money to these people, to the point where she had to take out a reverse mortgage on her home. She cashed out all of her life insurance. She had to borrow money from family members,” Stonchik said. “When she realized that she had been defrauded she was extremely devastated. She felt humiliated and she had literally lost everything.
“It was so much for her, it was so much to bear, so much so, and it pains me to say this, but she took her life because of this incident.”
Stonchik’s grandmother died with $69 in her bank account.
Stonchik said she and her family only found out 10 days before her grandmother died that she had been scammed for everything.
“I wish we had known how horrible the circumstances were for her in the last few months of her life,” she said. She implored people to get help at any time.
“It’s not too late, it’s not your fault,” Stonchick said.
Cottrell said the fraudsters don’t just limit themselves to lies anymore.
“Their efforts to keep victims in line become increasingly ruthless. They don’t hesitate to threaten, coerce, or resort to psychological intimidation,” he said.
Some victims send money to their scammers instead of paying for their rent, utilities, or medicines, Cottrell said.
He said consumer education is the best defense. “We can’t arrest all of these con artists, so prevention is truly critical.”
Maureen Ohlhausen, Federal Trade Commission acting chair, said her agency’s data shows that older consumers are not more likely to be victims of fraud, but when they are victimized, they suffer greater dollar losses.
And certain scams disproportionately affect the elderly, such as sweepstakes and prize promotions, technical support scams, and charitable donation frauds.
Attorney General Jeff Sessions said an estimated $3 billion is defrauded or stolen from millions of American seniors. He said the threat is growing, with the Senate Aging Committee’s Fraud Hotline receiving twice as many reports in 2016 than in 2015.
Sessions has ordered all 94 U.S. attorney’s offices to appoint an elder justice coordinator to focus on prevention and prosecution.
On Feb. 22, Sessions announced the largest elder fraud takedown in American history. The Justice Department, with the help of government partners and the private sector, recently charged more than 200 defendants for committing elder fraud schemes and brought civil actions against dozens more.
“These defendants allegedly robbed more than one million Americans of more than half a billion dollars,” Sessions said on Feb. 22.
“I hope that no victim of fraud feels ashamed. This can happen to anyone,” he said. “We need to spread the word about this.”