By Lukas I. Alpert
We celebrate them on Veterans Day and thank them for their service. But fraudsters often focus on veterans because of the benefits and programs available to them, experts say.
In October 2020, Larry Cook, a 76-year-old retired Navy commander, received an email purportedly from Amazon confirming the purchase of an iPad.
Cook hadn’t purchased the Apple (AAPL) device and called the number on the email to cancel the order, but the person on the other end of the line wasn’t working for Amazon (AMZN). It was a scam that would cost him dearly, his family said.
Over the next six months, Cook — who had suffered a serious stroke the year before — became the victim of an elaborate scheme in which he was convinced to wire $2.3 million to bank accounts overseas. It was only after Cook passed away in April 2021, that his family figured out what had happened.
Cook’s situation underscores the vulnerability of military veterans to financial predators who target them. Government officials and the Department of Veterans Affairs warn that such scams are on the rise.
In 2022, the Federal Trade Commission said it received over 150,000 reports of scams from veterans and military retirees that cost them over $414 million, up more than 50 percent from the previous year.
While many of the scams are little different than those faced by people who have never served, government watchdogs say veterans are particularly vulnerable to financial predators due to the wide range of education, health care, and housing benefits that are available to them.
“Some scams specifically target the military community, using false military affiliations or touting bogus offers for veterans in a cynical ploy to take advantage of servicemembers, veterans, and their families,” Monica Vaca, of the FTC, testified before congress last year.
Here are some of the more common frauds that veterans encounter:
Veterans are frequently targeted in scams in which the scammer poses as someone else in an effort to get money or personal information from the victim. The fraudster often will masquerade as an official from a government agency or a company that purports to help veterans access programs they are eligible for.
In these types of scams, the imposter will be the one to contact you, often claiming there is a limited time to act to receive some benefit. This should be an immediate red flag. Government agencies would never call you with such an offer, experts say.
Sometimes, scammers will email a veteran claiming to be from a fake government agency and asking for some personal information. This is a sign of a phishing scam that will use that information to attempt to hack into other accounts.
Things to look out for are poor spelling and grammar in the message, suspicious-looking links and unsecure domain addresses (meaning web addresses that begin with http rather than https).
Another form of the imposter scam is the romance scam, which often zeroes in on older veterans. Typically the con artist will reach out through social media or via dating sites, targeting widows and widowers to take advantage of their loneliness or isolation.
“If you are a senior citizen and a veteran, scammers have more than one way to play on your heartstrings,” said Mark Kapczynski, of OneRep, a service that helps people remove personal information from the web.
Scam artists will often claim to be residing somewhere overseas making it impossible to meet in person. They may keep the correspondence up for months, but eventually will begin asking for money, often to help pay for some kind of emergency. Usually, they will ask for the money to be wired overseas or sent in some hard to trace form, like gift cards or cryptocurrency.
In 2020, the FTC said military veterans and those on active duty lost nearly $41 million to such scams.
Charging for military records
Unscrupulous actors have sometimes set up and advertised sites where one can collect military service records or medical records for a fee. For starters, most of this type of information is available at no cost from the Veterans Administration or the National Archive, experts say.
These types of sites can also be vehicles for stealing personal information for use in hacking into accounts, so should be avoided.
Military pension fraud
Veterans’ pensions are a big target for scammers, experts say. Many times, the scammer will pretend to be a veteran themselves in order to make the fraud seem legitimate.
Most of these offers propose to invest that money for a bigger payout at the end, in exchange for a fee upfront. But oftentimes the scammer will disappear with the fee.
In another form of this scam, known as pension poaching, an unethical financial advisor will offer to structure a veteran’s or a veteran’s family’s assets in a way to increase the value of the pension for which they are eligible. But that often will result in the veteran being sold a product for which the advisor will receive a sizable fee.
Veterans are often eligible for preferential lending rates for mortgages. While a great benefit, it does attract its fair share of shady actors.
Some illegitimate agents will attempt to get a veteran to refinance their loans purportedly to access an even more beneficial rate, but that will usually come with high fees.
Some may claim to be working for a government agency, like the Department of Veterans Affairs, or for a legitimate loan servicer. Serious red flags, however, would be anyone instructing you to suddenly make your mortgage payments to a different account than usual.
For those facing foreclosure or having difficulty making their monthly payments, scam artists may offer to help for a fee, despite there being free options available. They may pressure you to sign papers without giving you time to read them through or understand them.
In some extreme cases, the fraudster might ask for you to sign over title to your property, claiming it will make it easier to help you stave off foreclosure or some other financial difficulty. Do not do this under any circumstance.
Job and school scams
Who doesn’t want to hire a vet?
One prevalent scam is a phony job post targeting vets. The prospective employer will claim to want to value veterans and want to hire them, but inevitably the so-called headhunter will begin asking for information like a social security number or even bank details. They may even ask for a fee for equipment or training related to the bogus job.
Also, those who have done their service are entitled to considerable education benefits through the G.I. Bill. Scammers know this and will often try to get you to pay it to them.
Some fly-by-night technical schools or license certification programs may claim to offer scholarships in exchange for upfront fees. Not every school is certified to receive G.I. Bill money, so any institution should be checked against the VA’s list of approved schools.
In some major scams, prosecutors have broken up operations that have signed up veterans for limited correspondence courses but then billed the VA for the cost of a full program, draining the vet’s G.I. Bill benefits.
-Lukas I. Alpert
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