Financial Tip of the Week from the Iowa Bankers Association:
Grandparents should be on the lookout for frantic phone calls from grandchildren and relatives — it could be a scam. Well-meaning senior citizens who think they are helping a grandchild in distress are becoming victims of the so-called "grandparent scam." Officials report that the scam is on the rise this time of year when many students and families are traveling for spring break.
Schemers are calling grandparents and posing as their grandchildren, claiming to need money for some sort of emergency or to pay bail. The "grandchild" often claims to be on vacation or out of the country and says he or she doesn't want mom and dad to know about the situation – which ranges from a car crash to being put in jail for drug possession. Some variations of the scam have even included a subsequent call from someone claiming to be a police officer or lawyer. The scam artists convince the grandparents to wire the money, then the scammers pick it up – and the unsuspecting grandparents lose what they've paid.
Officials report that scammers often search for victims on Facebook or in newspaper obituaries and anniversary announcements that include the names of grandparents and grandchildren. Using this information, the caller also often has enough information to initially pass off as the grandchild.
The Federal Trade Commission (FTC) and the Better Business Bureau (BBB) are warning grandparents not to fall for this scam. The FTC estimates that 10,000 unsuspecting grandparents fall victim to the scam each year and total losses nationwide are estimated at $100 million.
Grandparents who receive suspicious calls should contact other family members to verify the whereabouts of loved ones and confirm the story. Officials advise grandparents to not send money before making contact with the real person.
Consumers of all ages – particularly those with elderly parents, grandparents or neighbors – are encouraged to be vigilant about these types of scams.
These tips are provided by the Iowa Bankers Association (IBA), representing banks and thrifts in the state. The IBA serves it members by providing legislative advocacy, training, regulatory compliance and other services designed to enhance the ability of banks to serve their communities. Learn more at www.iowabankers.com.
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