4 Things You Must Do If You Lose Your Retirement Savings to a Scammer

Scams targeting older adults who have spent years building their savings are becoming more common. According to the 2023 Elder Fraud Report from the FBI, the agency’s Internet Crime Complaint Center reported total losses sustained from scams by individuals 60 and over were $3.4 billion — up 11% from the year before. Additionally, according to a recent AARP study , 12% of people aged 55 to 64 and 11% of those 65 and older reported being victims of fraud in the past year.

While all types of fraud are concerning, those that impact retirement funds can be financially devastating because they can potentially wipe out a lifetime of savings. Seniors need to be especially vigilant to protect themselves from these growing threats .

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Types of Retirement Account Scams

Various types of retirement account scams exist — some of them quite elaborate.

According to a report published by the New York Times , “Scammers can impersonate government officials, tech support staff or love interests. They coach victims on how to sidestep fraud prevention measures at financial institutions and they use manipulative psychological tactics — isolation, a sense of urgency or preying on people’s willingness to trust or connect — to keep the scam going.”

One recent scam involved getting victims to invest their retirement savings into gold.

Investors across multiple states, including California, Florida, Tennessee and Washington, have alleged that the now defunct Oxford Gold Group, a company that claimed to specialize in helping individuals invest in precious metals through retirement accounts like IRAs, has misused their retirement funds, as reported by Yahoo! Finance.

Greg Dahl, one of the victims, was promised by Oxford Gold Group that his retirement savings would be invested in physical gold coins stored at a Utah depository via a third-party called Equity Trust. However, after Dahl received a letter that Oxford Gold Group and Equity Trust had discontinued their relationship, Dahl called the depository to check on his gold. Unfortunately, he discovered that the depository had no record of the transaction.

As more victims have shared similar experiences, it became clear that Oxford Gold had left many investors in the same boat. The company has since vacated its office on Wilshire Boulevard and is no longer operational.

The California Department of Financial Protection and Innovation issued a warning about the risks of trading precious metals, stating that senior citizens are often targeted due to their high amount of retirement funds.

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What To Do If You Lose Your Retirement Savings to a Scammer

Bill Ryze, certified chartered financial consultant (ChFC) from Tennessee and board advisor at Fiona , said, “Losing your entire retirement savings to a scam is painful. I advise you to take the following four steps immediately to recover the money and prevent such occurrences in the future.”

Report the Matter to Local Police and Your Bank

Ryze said that the first thing you must do is raise the issue to your local police department or sheriff’s office.

“I also advise you to report the matter to your bank,” he said. “They can guide you on further investigations and refer you to the appropriate authorities. Please explain the matter in detail to the police. Criminals usually follow a set modus operandi. Give as much information as possible to the police to help identify the people behind the scam.”

Take Steps To Protect Your Identity in the Future

The second step is to protect your identity, Ryze said.

“Many people might advise it as bolting the door after the horse has fled. Nevertheless, safeguarding your identity can help prevent you from becoming a victim again,” he said.

It also helps if you have inadvertently shared personal information like your Social Security number or bank account details,” Ryze explained. “I also advise placing a fraud alert on your credit file or requesting a free security freeze.”

Block Access to Your Financial Accounts

Once you’ve been a victim of a scam, you need to be extra vigilant, Ryze said.

“Take the necessary steps to block unauthorized access to your financial accounts, including access to your smartphone, PC or laptop,” he explained. “I suggest enabling multi-factor authentication (MFA) for additional security.”

Consider Legal Action

“If you suspect tax fraud to your retirement plan, I advise you to file an Information Referral (Form 3949-A) with the IRS,” Ryze said. “I also recommend consulting a tax attorney if you have substantial funds at stake.”

This article originally appeared on GOBankingRates.com : 4 Things You Must Do If You Lose Your Retirement Savings to a Scammer