Sens. Susan Collins, R-Maine, and Claire McCaskill, D-Mo., say they are fed up with financial scams aimed at defrauding older Americans of tens of thousands of dollars in life savings.
The bipartisan pair have joined forces to write the Senior$afe Act, which would provide training and support to regulators, financial institutions and legal organizations to help them identify red flags for common scams and help put a stop to them.
The measure would “allow banks to train their frontline supervisors and their tellers and credit unions as well so that if they see signs of financial fraud directed at a senior, they can notify the appropriate authorities without fear of being sued for violating bank privacy acts,” Collins, who chairs the Senate Special Committee on Aging, told the Washington Examiner.
“It’s been endorsed by [AARP] and bank regulators. It’s a great bill that hasn’t gotten the attention it deserves,” she added.
Collins points to a study by the Government Accountability Office estimating that financial fraud targeting older Americans is a growing epidemic that costs seniors an estimated $2.9 billion annually.
In recent years, well-known schemes targeting seniors include the Jamaican lottery scam, as well as others impersonating IRS auditors and collectors. The Jamaican lottery scheme is particularly pernicious for seniors who have accumulated wealth over time, are more apt to respond to landline phone calls and may be suffering from Alzheimer’s or dementia.
Under this scam, a caller tells them, “You have won a million dollars,” but first you have to provide funds for taxes and other fees in order to obtain the money.
Elderly Americans send an estimated $300 million every year to scammers in Jamaica, and at least one senior who was defrauded has even committed suicide after realizing that this person’s life savings were squandered, according to Collins and a CNN report about the incident.
The AARP has tried to combat the problem by running ad campaigns warning of calls from the Jamaican 876 area code, and the U.S. Postal Service has also produced pamphlets aimed at educating seniors about the threat. The Senate Special Committee on Aging has held hearings on the problem, and Collins and other senators have urged the Jamaican authorities to do more to stop the practice.
Now Congress needs to intervene, Collins and McCaskill argue, because current bank privacy laws can discourage and even prevent financial institutions from reporting suspected fraud to legal authorities. The duo wrote the bill last Congress and reintroduced it in January. The House passed a similar bill last summer, but the legislation stalled in the Senate.
The measure would insulate financial institutions from lawsuits targeting them for revealing the identities of suspected fraudsters and reporting suspicious activity as long as they have trained their employees on how to file reports with legal authorities in the proper way.
The bill is based in part on Maine’s Senior$afe program, a collaboration among the state’s regulators, financial institutions and legal organizations to help educate bank and credit union employees to identify and stop fraud schemes that target senior citizens the most.
Maine’s program has helped train hundreds of financial institution managers, and employees and state officials focused on elderly services say it helps prevent vulnerable seniors from being defrauded.
The Senate bill has 20 bipartisan co-sponsors.
