Everything You Need to Know About the Grandparent Scam

Maybe you've heard of the grandparent scam. If you haven't, it's even more important that you read the answers to these grandparent scam FAQs. This information may keep you from becoming a victim and may help you keep a loved one from being victimized.

What Is the Grandparent Scam?

Worried grandmother victim of grandparent scam
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The grandparent scam is a form of telephone fraud. The scammer phones a grandparent and pretends to be a grandchild in distress and asks that funds be wired to a specified location.

How Does the Scammer Choose a Target?

No one knows for sure. Phone calls may be made at random until an elderly person answers, or scammers may be harvesting information from the Internet that enables them to choose targets. Some have suggested Facebook as a possible source of information.

Why Doesn't the Target Realize That the Caller Is Not a Grandchild?

If the target says that the caller does not sound like his or her grandchild, the scammers may blame a bad connection or a cold. Also, identifying voices over the phone is difficult for some senior citizens.

Does the Scammer Know the Grandchild's Name?

It appears that sometimes the scammers have the correct names at their disposal. This is one reason some investigators think that scammers are gleaning information from the Internet. More often, however, the scammers may elicit the name of a grandchild from the target, who often does not even realize that he or she has supplied a name.

What Kind of Stories Do the Grandparent Scammers Use?

The scammers often say that the grandchild needs money because of an accident, an injury, a theft or an arrest. Sometimes the "grandchild" pleads that other family members not be told because DUI or embarrassing circumstances are involved.

Can Victims of the Grandparent Scam Recover Their Money?

Due to the nature of wire transfers and the fact that most cases involve U.S. citizens wiring money to other countries, recovery of funds is very difficult. The Federal Trade Commission estimates that grandparent scams and other impostor scams cost Americans millions of dollars each year.

What Amounts of Money Are Involved?

Amounts can vary widely, starting with less than $1000. Often scammers who are successful in persuading targets to wire money will immediately ask for a second transfer. Channel 10 News in San Diego reported a 2011 case in which an elderly woman sent $132,000 to China.

Are There Other Negative Results From Being Scammed?

Yes. Those who are the victims of scams may lose faith in their own judgment, a doubt that family members may share. Sometimes the result is that an elderly person is prematurely stripped of control of his or her own money. Sometimes older persons become hesitant to answer their phones.

What Countries Are Implicated in the Grandparent Scam?

Most cases originate in Canada, but scammers in Puerto Rico, Haiti and China are joining the action.

Why Can't We Catch the Scammers?

The nature of international wire transfers makes it difficult to catch the perpetrators. Many times they use prepaid cell phones that cannot be traced. Some scammers have been caught and charged.

How Can One Avoid Being a Victim?

Never wire money to an unknown person. If you receive a call regarding a family member in distress in a foreign country, verify the information with family members. Another method is to have a family password, such as the name of a pet, which you can use for verification of the caller's identity.

Why Would Anyone Fall for This Scam?

The scammers can be very persuasive. In addition, the emotional distress caused by being told that a loved one is in trouble can make one abandon rational thought.

What Should Be Done If Someone Falls Victim to This Scam?

The victim should immediately notify the wire transfer company. In addition, the following entities should be notified:

What Is Being Done to Stop the Grandparent Scam?

Efforts so far have focused on educating the public, but it is a huge job to reach everyone and to keep the information fresh in people's minds. Recently some companies that handle wire transfers have begun training their employees to watch for red flags that might signal a grandparent scam, such an elderly person who appears distraught wanting to transfer fairly large sums of money.