​Identity fraud is easy money for criminals, but there are four steps you can take to protect yourself and your money:​​

1. Ignore requests for an urgent form of payment, such as using a gift card or making a wire transfer.
   
   
2. ​Protect your passwords and log-in information.
   
   
3. Do not communicate with strangers about confidential or sensitive financial matters.
   
   
4. Verify everything you’re told to determine if a supposed problem truly requires your attention.

The helpful tips are in a new, AARP-sponsored report by Javelin Strategy & Research, which estimates that identity fraud led to $56 billion in losses in 2020.

The report says older consumers are not more vulnerable to every kind of fraud, but notes that the stakes are high for adults age 50-plus because losses tend to be steeper for people who have accumulated a lifetime of wealth.

The report also:

• Describes the four common personas that fraudsters hide behind as they lie, cheat and steal.
  
  
• Explains that some frauds, such as paying online for nonexistent goods and services, struck consumers of all ages at about the same rate. Other frauds tend to hurt certain age groups more often.
  
  
• Explores the financial and emotional price of fraud.

Now let’s take a deeper dive into the four tips:

Urgent requests for payment. If you haven’t met someone face-to-face and are asked to make an immediate payment, that’s a red flag. That’s especially true if you’re asked to pay in an unusual way, such as by buying gift cards. You might be talking to a fake utility company that threatens you with immediate loss of service or to a phony debt collector. Or you might receive a past-due bill for something you never sought, such as carpentry work. “Bill payment fraud is a growing threat to consumers,” the report warns.

Protect passwords and log-ins. Simple usernames and passwords are risky. Vary your usernames and use complex, varied passwords. You can write these down and keep them in a safe place or use a password manager.

Don’t communicate with strangers about confidential or sensitive financial matters. Remember that if you have never met someone in person, technically they are strangers.

Verify everything that you’re told. The faster crooks incite you to act, the more likely it is they will rip you off. So hang up on a suspicious call or log off your computer, then contact a legitimate business partner to check out what you’ve been told. Be sure to use a phone number you are certain is authentic.

The Four Faces of Fraudsters

Javelin Strategy & Research, 2021

Criminals adopt various personas — sometimes called social facades or fronts — to deceive consumers into trusting them. These four are common:

One is the “good egg” who, for example, offers a great interest rate, unclaimed money or romance.

The second is the “punisher” who pulls at consumers’ heartstrings by saying their relative is in jail or they owe big bucks to the IRS.

The third is the “authoritarian,” such as a fake bank employee or phony medical practitioner, who delivers information that seems factual, clear cut and important — but isn’t.

The fourth is the “oracle” who shows up unannounced, in an email, instant message or even face-to-face, and warns of imminent danger. This crook often asks for passwords or control of your computer, supposedly to prevent disaster.

Consumers of all ages “are prime targets for criminals” since crooks who want to steal other people’s personally identifiable information don’t follow an ethics code and exclude certain groups. Impostors “might make individual calls to their victims or pre-record mass ‘robocall’ messages that are randomly sent to thousands of potential victims,” the report says.

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The wallop hurts more than your wallet 

Fraud affects victims financially and emotionally, and many are reluctant to report these crimes “out of shame that makes them feel incapable of handling their personal business affairs,” according to the report, which urges people to file official complaints. “As identity fraud victims shoulder self-doubt and shame, they can spiral into moral distress that leads to feelings of toxic anger, social isolation, and even suicide.”

Success of scams varies by target’s age

The good news in the report for adults age 65-plus is that they were savvy about certain frauds. None in this age cohort who were surveyed said they had purchased stolen or fake gift cards; been victimized in a debt-collection scam; or lost out in a face-to-face encounter with a criminal. In these cases, adults ages 50 to 64 more often were victims, and even more so, those ages 18 to 49.

But there’s a universal scam that hit consumers of all ages in roughly the same proportion: Online purchasing fraud victimized 28 percent of adults 50 and older and 29 percent of those ages 18 to 49. During the first year of the pandemic “there was such an incredible demand for protective gear and cleaning supplies that many consumers resorted to blindly trusting online entities for much-needed personal items,” the report says.

In other frauds, the proportion of consumers affected differed based on age. Some examples:

• Impostor phone calls. Thirty-six percent of adults age 65-plus were victimized by such calls; 22 percent of those ages 50 to 64; and 21 percent of younger adults.
  
  
• Tech-support scams. Twenty-two percent of adults age 49 and younger were victimized by them; 14 percent of those age 65-plus; and 13 percent of those ages 50 to 65.
  
  
• Money-transfer scams using, for example, Western Union or MoneyGram. Twenty-one percent of those ages 50 to 64 were victimized; 20 percent of those ages 18 to 49; and 4 percent of those 65-plus.
  
  
• Peer-to-peer payment frauds using, for example, Venmo or CashApp: Twenty-one percent of adults ages 18 to 49 were victimized; 19 percent of those 65-plus; and 14 percent of those ages 50 to 64.