Help! My parents are being targeted by scammers

This is an audio transcript of the Money Clinic podcast episode: ‘Help! My parents are being targeted by scammers’

Miranda Green
I mean, my dad, after he was diagnosed with dementia, was taking out insurance cover he didn’t need because he was ticking a lot of boxes.

Claer Barrett
That’s my FT colleague, Miranda Green. After her father died, she had to sort out his financial affairs and those of her surviving mother. Miranda was shocked at what she found. Plenty of finance companies and insurance brokers appeared to have taken advantage of her father’s vulnerability.

Miranda Green
So I found out the microwave was insured and the heating system was insured and their boiler was insured, their oven was insured, as well as the household contents insurance . . . 

Claer Barrett
Completely needless insurance plans . . .

Miranda Green
(Sigh) This is the thing.

[MUSIC PLAYING]

Claer Barrett
Welcome to Money Clinic, the FT’s weekly podcast about personal finance and investing, with me, Claer Barrett, the FT’s consumer editor. Coming up, part two of what’s been called “sadmin”.

[MUSIC PLAYING]

In our previous episode, Miranda Green told us about the many hours she spent battling to settle her late father’s finances after he died nearly a year ago. Well, in the course of doing that, Miranda has discovered a secondary problem. Both of her parents have repeatedly fallen victim to fraud attempts of mis-selling that appeared to be deliberately targeted at the elderly. Turns out this is a worryingly widespread problem. Elderly fraud victims are facing a tidal wave of scams with losses of over £1mn a day, according to Action Fraud statistics. But many are too ashamed to report they’ve fallen victim to a fraudster. So keep listening because we have advice on how to protect yourself and anybody elderly you might be looking out for.

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Miranda’s dad died in December last year. For the last four years of his life, he’d been suffering with dementia. And when Miranda started looking through her father’s bank statements, she could see all kinds of direct debits were being taken every month. And most of them have been running for many years. It wasn’t immediately obvious what they were for. It took some sleuthing to find out, but in the main, they were for insurance policies her parents had been persuaded to take out.

Miranda Green
I got very exercised at the beginning because I thought, oh my goodness, these people, they’ve been selling old people products they don’t need.

Claer Barrett
Multiple useless insurance policies for items in the home.

Miranda Green
On top of their home contents insurance, there was another thing which was a legal cover, family legal cover, which covered things like party wall disputes. They live in a leasehold flat.

Claer Barrett
They’re never gonna need it. So it’s completely selling.

Miranda Green
They’re never gonna need that. (Inaudible) dispute me with, it would be with me, if there ever was one. But the problem is when I actually sort of looked at all of these in detail, I spent hours on the phone to the brokers and then the insurance companies, they are on really firm territory because they can say, OK, well, your father ticked this box. And at a certain point, you know, an adult gave their consent to be charged a fee for insurance cover. Whether they actually needed it or not is kind of, you know, becomes beside the point.

Claer Barrett
So the brokers and insurance companies Miranda spoke to were unable to satisfactorily explain how her father — an elderly man with dementia — had been persuaded to sign up for these insurance policies in the first place.

I mean, you’ve looked at his bank statements. Give me a rough idea of how much money we’re talking about going out maybe every month for these useless policies.

Miranda Green
So the, insuring the microwave, it was like, 13 . . . between . . . it went up for about £13 a month to about £20 a month.

Claer Barrett
I mean, you could buy a microwave for, like, 40 quid.

Miranda Green
I know. Yeah. The heating system is a bit more complicated because they’ve got a very weird immersion heater thing with rods. They have convinced me that that was an insurance policy that they needed. But the legal cover that was an add-on to the home contents, why did he need that? It wasn’t very expensive. It was kind of £10, £11, £12. But over a year that adds up. Over several years, that really adds up. They did not need it.

Claer Barrett
Although she couldn’t prove it, Miranda wondered if her dad had been sold one policy and then targeted by salespeople to sign up for many more. And a key point: he was sold most of these insurance policies after being diagnosed with dementia.

After a quick call to my own parents to check that they haven’t been mis-sold any insurance policies for their microwave, I went back to the FT newsroom to find out how widespread an issue this might be. Well, it didn’t take much digging to find out that Miranda’s elderly parents are not alone in being targeted. I’ve literally just been sent the press release from the Information Commissioner’s Office. They’re the UK’s privacy watchdog. Now, they’ve been cracking down on rogue companies doing exactly this, using pressurised sales techniques to sell insurance for white goods and other household appliances. Now it’s just issued more than £500,000 in fines to five companies who made 1.9mn unwanted marketing calls, deliberately targeting the elderly and people with vulnerabilities. I mean, just sickening. Now, the ICO started investigating this problem two years ago, and since then it’s fined 16 separate companies. So I think it’s time to give them a call. (Dialling numbers) Would you like to introduce yourself to our listeners, please?

John Edwards
Sure. Thanks, Claer. My name is John Edwards and I’m the information commissioner.

Claer Barrett
Fantastic. So you’ve heard what’s happened to my colleague Miranda after her father’s death. Looking through his bank statements, she discovered all of these direct debits going out to various insurance policies, which she had no idea that he’d taken out, it turned out he didn’t really need. Now, what might a typical phone call selling a policy like that have sounded like?

John Edwards
Well, there’s a range of sort of operating models that we find that these callers can be quite insistent. Sometimes they can be even intimidating, particularly with older, more vulnerable customers and really hard-selling these largely junk products that are expensive, that can drain bank accounts with no real benefit. These are purportedly insurance policies that are quite weird. So, you know, people are pressured into accepting them. I think sometimes people just accept them to get the caller off the phone and they find themselves locked into direct debits.

Claer Barrett
You’ve been investigating this area of the market for two years now. Do you think that elderly people are deliberately being targeted by these companies?

John Edwards
That’s our are working hypothesis. It may be that landlines, which are their preferred mode of contact, are more widely used by the older population. But no, we have reason to believe that there is targeting of older people.

Claer Barrett
I mean, why would these cold callers, hard sellers target the elderly? What’s in it for them?

John Edwards
Well, I think they’re exploiting what they assume to be frailties. We’ve heard of stories, I think, that involve people who suffer from dementia, who may not have people around them who are able to caution against these kinds of scams. They may have savings because of their vulnerability. They may be keener to fall for something which is offering them security in the event that their white ware doesn’t last the distance.

Claer Barrett
That’s the fridge, the washing machine, the microwave, in the case of Miranda’s dad. It’s quite chilling to hear that they could deliberately target people who are elderly or indeed have dementia. But in terms of the data sets involved, how are these companies able to do this? How are they able to target specific groups of consumers with their cold calling?

John Edwards
Well, that’s been something that we’ve struggled to understand, whether they’re just using robo-calling indiscriminately or whether they are, in fact, purchasing lists of people that are profiled for those sorts of vulnerabilities. It does seem to us that there is some trade among these scammers of data so that if they’ve managed to sell one product, then they’ll come back. And we find, I think, as Miranda found with her father, that there’s not just one deduction being made, there’s a number of them, and that these pitches have been made and products sold by a number of different outfits that which may be linked or may be evidence of a trade in the data. It’s really quite difficult for us to tell.

Claer Barrett
Now, the main reason that you, as the information commissioner or the data watchdog as some people call you, are able to take action against firms that do this, where there is evidence that they’re calling numbers where there’s been a registration from people saying, we do not want sales calls. Could you explain a little bit about that to our listeners?

John Edwards
Yes. Anyone who does not wish to receive unsolicited marketing calls or anyone who has a vulnerable person in their family is entitled to get in touch with the Telephone Preference Service, the TPS, and go on their register. So the TPS register is a do-not-call list. And if they’re on that register, the telephone marketing company must screen their list against that register and must not call anyone who is on that. So we’ve been able to prosecute a number of companies and issued fines of over nearly £1.5mn in the last year and a half or so against companies which have routinely called people who are registered on the do-not-call register.

Claer Barrett
Why aren’t these fines larger? Are we giving enough of a deterrent to the companies who could see this just as a cost of doing business when you look at the millions of calls that they’re making and the size of the fine that you’re able to enforce?

John Edwards
Yes. I mean, we fined an organisation last week, £65,000. They paid it within seven days. So they had that money lying around. In other cases we fine organisations and literally put them out of business. They go insolvent. So we know that those have an effect. We recognise that this is a significant scourge and we are working with fellow regulators and with the government to try and more effectively curtail these exploitative and predatory business practices.

Claer Barrett
So as John says, the government is trying to find a way of streamlining the fines that can be imposed for breaches of privacy. And he says that if the data agencies joined forces, multimillion pound fines could be issued. Now that really would be a deterrent.

Back to John for an important last question. What would you say to people listening who are thinking, I want to sign up to the Telephone Preference Service or I am being targeted despite being signed up to the Telephone Preference Service, how can I report this? What should they do?

John Edwards
So the first group I would say you should definitely sign up for the TPS. If they are signed up and are still getting calls, I hope that they will let us know at ICO.org.uk. Now, we don’t necessarily leap into action with each call because of the volume that we get. Unfortunately, as I said, this is a scourge. There is robo-calling, there is international calling, there are a number of challenges that we have. But every report that we have adds to our intelligence. So if we see a pattern of calls from a particular company which is acting in a particularly exploitative way, we will prioritise that. We will go after them, we will prosecute them and we will find them and we will occasionally ban the directors from starting future companies.

Claer Barrett
Thanks to Information Commissioner John Edwards. And you can find all of the links he mentioned in today’s show notes. Well, I also got in touch with the Association of British Insurers. Its members provide most of the insurance for houses and homes in the UK. I put it to them that surely they must be doing something to help stamp this out. Here’s what they replied.

Association of British Insurers statement via voiceover
Any actions that target and take advantage of vulnerable people, whilst we can’t comment on companies that are not represented by the ABI, our members work hard to ensure vulnerable individuals and their families are supported and to deliver the best outcomes for customers. We have published guidance on the steps firms can take to deliver the most suitable customer service and cater to individual needs, and our members have processes in place to ensure staff are adequately trained.

Claer Barrett
It might not be its members who are making these calls, but it’s very much in the wider insurance industry’s interests to work with the information commissioner and others to stop these practices. But let’s go back to Miranda, because it wasn’t just needless insurance policies she discovered lurking in her parents’ finances. She also came across another problem.

Miranda Green
Unfortunately, when somebody dies, the surviving spouse often becomes a sort of target for financial fraud. And we’ve had a lot of problems with that as well.

Claer Barrett
So alongside the “sadmin” for her dad, Miranda has now been sucked into a fresh problem: trying to stop her surviving 89-year-old mom from being targeted by fraudsters.

Miranda Green
I mean, to give you an example on that fraud, somebody was having their hair done in Manchester at my mom’s expense, spending vast amounts of money at airports around the UK regions. My mum’s hardly left her flat for four years. It clearly wasn’t her. But the credit card account, she was not flagged as a vulnerable elderly customer, even though it’s the same company as the bank account where she is.

Claer Barrett
Miranda’s mom is still very much alive, but at 89 she’s weighed down by grief and overwhelmed by the “sadmin” Miranda hasn’t managed to intercept in time and she doesn’t know who to trust at this point. So Miranda has obtained the authority to phone up and speak to the bank on her mother’s behalf.

Miranda Green
One thing that I have discovered, which is useless, is because all of the banks, well, a lot of the banks and credit card companies and indeed utilities, they try and communicate with everybody by SMS text message these days, which is no good if somebody is 89. I mean, one of the frauds we’ve been trying to deal with, they’ve been communicating with her by SMS. I mean, she hasn’t seen any of these messages. It’s ridiculous. And when I phoned up and said, well, you know, maybe you could send a letter, they were kind of horrified at this idea or not being interested at all. So I think possibly there’s a little bit of a assumption that everyone in the British population has moved into the digital era when they really haven’t.

Claer Barrett
And that’s not Miranda’s only criticism.

Miranda Green
When I got the bank to register that my mom is now a vulnerable customer, that didn’t get translated to the other companies that are part of that bank, like the credit card. So then there was a fraud going on on her credit card but there was no red flag on the account. I made sure there was a red flag on the bank account. They also need to communicate better internally when you’re flagging somebody up as vulnerable.

Claer Barrett
Miranda has been trying for the past few weeks to stop the fraud attempts on her mom’s bank and credit accounts. But I wanted to find out how that’s been going. So she joined me in the FT studio to give us an update. Now, Miranda, it’s always a pleasure to have you in the FT Money studio, but I fear you don’t have good news to impart.

Miranda Green
Well, it’s been a mixed picture, Claer, as you would imagine. I mean, there has been some good news in that one credit card company ended up being very, very effective. It took a very long time but their bereavement team got back in touch with me eventually to say they completely agreed. None of these transactions could possibly be my poor mom or indeed my father, who is no longer with us. And so the spending on the card was refunded and they have let me close down the account. Another household name credit card company has not been so good. And in fact, really worryingly, there was a definite fraud on that account. And even so, after we froze the account pending investigation, they in fact reactivated the account without us asking for it to happen and sent out a new card, thereby reopening the potential avenue for fraud. And when I got in touch with them, they didn’t even have her flagged as a vulnerable customer. Someone had ticked the wrong box and had her down as visually impaired. And so they were sending her what didn’t look very secure to me, they were sending sort of floppy disks of audio statements, which of course anybody who, you know, wanted could have listened to. So we still haven’t managed to shut that other account down, which is sort of therefore an ongoing point of vulnerability, because for me, it’s become a task of really trying to sort of shut off all possible avenues of . . . 

Claer Barrett
 . . . any way that the fraudsters could get to.

Miranda Green
Exactly. So keeping things as simple as possible, you know, no random accounts, no random cards flying around, anything like that, and also having her flagged as vulnerable with all these different institutions of whom I’m trying to sort of massively reduce the number. And in fact, there was then another fraud attempt against my mom, which depressingly was somebody phoning up and pretending to be a police officer investigating one of the frauds. So of course she listened to them and engaged with them on the phone because they knew that there was a fraud investigation and they gave a fake crime number, a fake officer number, said they were from Hammersmith police station, kept her on the phone for absolutely ages. Luckily, she realised that was a fraud and phoned 999, gave them my details. They phoned me, we got the real police to come around . . .

Claer Barrett
They actually came around.

Miranda Green
Yeah. We had really a very nice local police team came around to talk to mom about it. But really there’s very little you can do because clearly if somebody is being targeted in this way, they said probably your number is on a list that’s being traded.

Claer Barrett
A suckers list.

Miranda Green
A suckers list. Exactly.

Claer Barrett
As we heard earlier from the information commissioner, John Edwards, you can register with the Telephone Preference Service to try and prevent yourself getting on to a suckers list. And if you’re still getting cold calls, you should report them. We know by now that Miranda’s experience with her parents isn’t unique. It seems that the elderly are more likely to be targeted by fraudsters than any other age group. Why is this? And who’s fighting their corner? Well, Age UK is the charity that campaigns on behalf of older people. So we invited its fraud specialist to the FT studio.

John Kamoto
My name is John Kamoto and I work as a policy and research officer at Age UK, and I lead on the charity’s policy on scams and fraud.

Claer Barrett
We played John some of Miranda’s account of what’s been happening to her mom and asked him why older people are particularly vulnerable to fraud.

John Kamoto
Unfortunately, because, for example, an older person might be recently bereaved, scammers tend to try and target them as much as possible.

Claer Barrett
They deliberately target people who have been recently bereaved.

John Kamoto
Yes. And this is because of reasons such as being isolated or having things like loneliness. So they might target them because of that reason or . . . 

Claer Barrett
They’re more likely to chat on the phone.

John Kamoto
Yes. Yes, exactly. And the communications regulator, Ofcom, has said that 1 per cent of older people are more likely to pick up the phone or talk through landlines. Unfortunately, we hear this through our scams prevention and support programs where older people come to us for one-to-one sessions, for example, or just to find out more about the latest scams. So yeah, it’s a massive problem that needs to be dealt with.

Claer Barrett
Is there more that different agencies, the government, the police could do to protect older people who increasingly are the focus of the scammers target?

John Kamoto
Yes, there’s a lot happening at the moment. This year, the government published its national fraud strategy, obviously, which we welcomed. But, however, we have some concerns about the underfunding, for example, and the lack of border policing reform that needs to happen.

Claer Barrett
The wheels are turning when it comes to how victims of fraud are refunded and the way that regulators and banks have to decide whether they were the innocent victims or not. Can you tell us a little bit more about what concerns you about the rule changes that are coming up from what Age UK is pushing for?

John Kamoto
OK. So we have authorised push payment fraud, which is when fraudster tricks you to send them money via the faster payment system. On that type of fraud, the payment system regulator are gonna mandate banks to reimburse victims. However, there’s gonna be some red lines to allow firms to not reimburse victims or partially reimburse them. And one of them is the warning signs that you might see when you’re trying to send someone money.

Claer Barrett
Those things in the app, pop-up.

John Kamoto
Yes. Exactly.

Claer Barrett
Who is this payment for? Have you been asked to make it?

John Kamoto
Exactly. And our problem is because we know that fraudsters tend to socially engineer their victims into doing that and they will coach them each step.

Claer Barrett
Every pop-up that comes up they’ll think of a reason why you should ignore it.

John Kamoto
Exactly. And one of the red lines that if the customer gets the warning saying that the payment might be likely sent to a fraudster and if you overlook that, then you might not get reimbursed by the bank. However, the victim is not acting voluntarily here. They’re being coerced into doing so. We’re not happy that that’s gonna be allowed for banks to then say that the person is grossly negligent. So, yeah, we want the regulator to think again about that and possibly change their plans.

Claer Barrett
What specifically would Age UK like to see to help protect more elderly people from falling victim to these kinds of crimes?

John Kamoto
We would like to see more measures applied to tech companies and telecommunications companies. For example, with authorised push payment fraud, some 8 per cent of that originate from either social media or yeah, other platforms. Also 18 per cent comes from telecommunications companies. So, for example, texts.

Claer Barrett
Links and texts. Never believe a link in a text . . . Start from the position where there’s a fraud and work backwards.

John Kamoto
Please never do. Exactly. We would like to see more measures applied to them. Right now, the government are trying to do a voluntary charter, but we already saw that with the banks. That didn’t work.

Claer Barrett
Now, finally on prevention, people who are listening, whether they’re old or young, what are the things that we can do either for ourselves or for our parents to help minimise the risk of them falling victim to these horrific crimes?

John Kamoto
Well, I think one of the main things in terms of trying to minimise fraud as a crime is talking about it. We hardly talk about it because we think because I was a victim, therefore I might be stupid or they might see me as gullible. And in terms of older people, it takes on a new form because they might think, OK, if I tell my son or daughter they might think my mental capacity is going down, therefore my financial freedom, I might lose that.

Claer Barrett
They might want to take over my affairs.

John Kamoto
Exactly. So yeah, there’s this new kind of like . . . 

Claer Barrett
So really your mum and dad could have been defrauded and they’re too embarrassed to tell you, their son or daughter.

John Kamoto
Unfortunately, that’s the truth. Yeah.

Claer Barrett
And finally, is there anything else that John advises?

John Kamoto
In terms of the phone calls you might get, fraudsters, I would say especially nuisance calls, put the phone down. Try not to talk to them for too long. If you’re being called for any financial service or product, I’d say put the phone down and don’t try and talk to them.

Claer Barrett
Just start from the assumption if they’re calling your landline, if you’re on the Telephone Preference Service, you shouldn’t be getting these calls. It’s bound to be somebody with designs on your cash.

John Kamoto
Bound to trick you, exactly. Yeah, yeah.

Claer Barrett
That was John Kamoto from Age UK.

Well, this might be the end of today’s show, but I can promise you that the FT’s reporting of this story and what more can be done to protect the elderly will continue.

Now coming back to Miranda who’s with me in the studio, you’ve been so willing to share your family’s deeply personal experiences of these problems in order to raise awareness. So I’d like to give the last word to you.

Miranda Green
Thank you, Claer. I mean, well, for me, it has been a bit of a hellish aspect of losing my dad. I must say dealing with these problems is worrying, and it, quite frankly, gets in the way of grieving. And that’s what a lot of FT readers pointed out when they got in touch with me about this “sadmin” column, originally. I think, you know, fraud is really the modern crime. It is a huge problem. It’s really kind of a campaign of fear against the elderly and vulnerable because they don’t know who to trust. And we need policy people, law enforcement, the entire financial industry as well, to really pull their finger out. We just need to ask, why are we making it so easy for the fraudsters?

Claer Barrett
And so difficult for the families of the vulnerable who, you know, our parents, who we’re trying to protect. Well, thank you so much for all of the work you’ve done on this. And Miranda, I think I speak for everybody listening. I really hope that the “sadmin” nightmare is gonna come to an end soon so that you can get on and your mum can get on with enjoying the rest of your life.

Miranda Green
Oh, thank you, Claer.

[MUSIC PLAYING]

Claer Barrett
Thanks so much to the FT’s Miranda Green for letting us into her life. If you’ve been affected by the issues discussed in today’s episode, there are lots of links to organisations that can provide help and support in today’s show notes. And if you would like to contact us with your experiences of this problem for a follow-up episode, then email us. Our address is money@ft.com.

Money Clinic was presented by me, Claer Barrett, and produced by Philippa Goodrich. Our executive producer is Manuela Saragosa. Our sound design was by Breen Turner, and the original music is from Metaphor Music. Cheryl Brumley is the FT’s global head of audio. See you next time. Goodbye.