Seniors represent an important customer segment for most banks, constituting a primary source of core funding in an environment where sources of core deposits are scarce. Expanding relationships with this critical market requires developing a differentiated value proposition that does not rely exclusively on premium CD rates. One approach is to install highly effective programs that address an increasingly urgent issue for seniors: financial scams.
Financial scams targeting seniors are exploding, with both the number of victims and dollar amount of losses doubling over the last four years. FBI statistics peg the dollar loss at $3.4 billion in 2023, but most experts caution that the reported losses are just a fraction of the actual losses. Further, these types of scams will accelerate as the population ages further and scammers employ even more sophisticated technology to defeat existing fraud prevention procedures.
Financial institutions are the first line of defense in the war against elder financial scams. After all, these scams involve money, and the origin of that money is most often a bank account or credit card. Most experts agree that to stop a scam you need to stop it at the source, and generally banks have done a good job on the basics — identifying many forms of suspicious activity, issuing alerts and providing some form of education to both customers and staff. While these actions are necessary, they are not sufficient to counter the increasingly sophisticated schemes that fraudsters have devised to circumvent bank detection and mitigation systems and procedures.
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