Approximately 1 in 10 U.S. adults are victims of fraud each year (Anderson, 2013), with research indicating that older adults face a greater risk of fraud victimization than younger adults (Lachs & Han, 2015). Mass marketing scams are some of the most common frauds striking older adults (FTC, 2018b; Lonsdale, Schweppenstedde, Strang, Stepanek, & Stewart, 2016). These mail fraud scams convince susceptible targets that they have won bogus sweepstakes, merchandise, free vacations, and lotteries, but they first need to pay money to claim their winnings. Estimates suggest that the majority of mass marketing fraud victims are over 50 years old and that the likelihood of experiencing revictimization increases with age. This means that older victims account for a large portion of the billions of dollars of losses attributed to mail fraud from mass marketing.
The Impact of Mail Fraud on Senior Citizen Fraud Victims
According to recent estimates, Americans suffer more than $1.48 billion per year in direct losses from fraud (FTC, 2019). In addition to financial costs, victims of fraud experience consequences like feelings of shame and embarrassment, loss of trust, depression, and in the most severe cases, suicidal ideation (Buchanan & Whitty, 2014; Button, Lewis, & Tapley, 2014; Cross, 2018; Deem, 2000). These consequences are particularly impactful for older adults who tend to suffer higher losses per incident (FTC, 2018a) and face greater challenges recovering from losses after retirement. Reducing the incidence of mass marketing fraud and the likelihood of revictimization could save older adults millions of dollars and reduce the severity of the physical, emotional, and financial consequences.
How RTI is Helping Combat Mail Fraud in Senior Citizens
RTI International is working with the United States Postal Inspection Service (USPIS) to develop and test consumer education materials designed to reduce revictimization among older victims identified as having responded to a mass marketing scam.
The USPIS is a key partner in fighting mail fraud
As the federal law enforcement agency tasked with enforcement of all crimes involving the mail, the US Postal Inspection Service (USPIS) collects victim data from all mailed responses to mass marketing fraud scams. Over the years, the USPIS has tried, but never evaluated, a number of approaches geared towards educating residents about mail fraud via mass marketing and preventing repeat victimization. Currently, when postal inspectors identify a PO Box or address that the fraudsters are using to collect victim payments, they detain the envelopes headed to those addresses for investigative purposes and victim protection. For victims who sent cash or money orders to the fraudster, the USPIS returns the payment to the victim with a letter explaining that they have been a victim of mail fraud and a brochure about fraud prevention. However, returning these payments can take more than a year because they are part of an active investigation. The USPIS is interested in understanding whether this type of mailed intervention could be used more widely and rapidly to effectively prevent repeat mass marketing fraud victimization.
The Mass Marketing Elder Fraud Intervention Study
With funding from the National Institute of Justice, RTI is partnering with the USPIS to:
- Analyze historic USPIS data to understand trends in elder fraud repeat victimization
- Develop a mailed intervention to be administered to identified victims of mass marketing fraud
- Test the effectiveness of the intervention
- Conduct a survey on elder fraud victim perceptions of the intervention
Using return addresses on unopened victim mail detained by the USPIS, we will test the effectiveness of three versions of mailed intervention materials delivered in a much shorter time frame. Victim return addresses will be randomly assigned to one of three treatment groups or a control group. Treatment groups will receive (1) a letter from the USPIS, (2) the same letter from the USPIS and a brochure giving victims a call to action to become a fraud fighter, or (3) regular and varied mailings over the course of 6 months, designed to reinforce the notion of being a fraud fighter. The mailings are designed to improve victims’ resiliency against subsequent scams. The control group will receive no intervention during the study period.
The outcome of interest, revictimization, will be measured through observation of actual elder fraud victim behavior, rather than traditional self-report studies or mock scam scenarios. For up to 1 year, the USPIS will provide RTI with return addresses from all detained fraud payment envelopes to track whether victims from the experiment respond to subsequent scams. A follow-up survey with a sample of victims will collect data on victim characteristics, including age, any unintended consequences of the intervention, and victim susceptibility to other types of fraud.
Informing UPSIS Mail Fraud Prevention Practices Moving Forward
The ultimate goal of the study is to provide specific policy recommendations to the USPIS regarding the effectiveness of these interventions. If the intervention can successfully prevent older adults from repeatedly falling victim to mass marketing scams, the USPIS will consider implementing a similar practice on a wide-scale basis. Findings on the effectiveness of the fraud prevention messaging will also have value for other agencies and organizations that engage in elder consumer fraud prevention and education. The MMEFI project is an important step towards understanding elder fraud and preventing hundreds of thousands of older Americans from suffering the physical, psychological, and financial consequences of fraud.
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References
Anderson, K. B. (2013). Consumer fraud in the United States, 2011: The third FTC survey. The Federal Trade Commission, Washington, DC. Retrieved from https://www.ftc.gov/sites/default/files/documents/reports/consumer-fraud-united-states-2011-third-ftc-survey/130419fraudsurvey_0.pdf
Buchanan, T., & Whitty, M. T. (2014). The online dating romance scam: Causes and consequences of victimhood. Psychology, Crime & Law, 20(3), 261–283.
Button, M., Lewis, C., & Tapley, J. (2014). Not a victimless crime: The impact of fraud on individual victims and their families. Security Journal, 27(1), 36–54.
Cross, C. (2018). (Mis)understanding the impact of online fraud: Implications for victim assistance schemes. Victims & Offenders, 13(6), 757–776.
Deem, D. L. (2000). Notes from the field: Observations in working with the forgotten victims of personal financial crimes. Journal of Elder Abuse & Neglect, 12(2), 33–48.
Federal Trade Commission (FTC). (2018a). Consumer Sentinel Network data book 2017: Reported frauds and losses by age, percentage reporting a fraud loss and median loss by age. Washington, DC. Retrieved from https://www.ftc.gov/policy/reports/policy-reports/commission-staff-reports/consumer-sentinel-network-data-book-2017/frauds-losses-age-percentage.
Federal Trade Commission (FTC). (2018b). Protecting older consumers 2017–2018: A report of the Federal Trade Commission. Report to Congress. Washington, DC. Retrieved from https://www.ftc.gov/system/files/documents/reports/protecting-older-consumers-2017-2018-report-congress-federal-trade-commission/protecting_older_consumers_-_ftc_report_10-18-18.pdf .
Federal Trade Commission (FTC). (2019). Consumer Sentinel Network data book 2018. Washington, DC. Retrieved from https://www.ftc.gov/reports/consumer-sentinel-network-data-book-2018
Lachs, M. S., & Han, S. D. (2015). Age-associated financial vulnerability: An emerging public health issue. Annals of Internal Medicine, 163(11), 877-878.
Lonsdale, J., Schweppenstedde, D., Strang, L., Stepanek, M., & Stewart, K. (2016). National Trading Standards—Scams Team Review (RR-1510-NTS). Prepared for National Trading Standards. Retrieved from https://www.rand.org/pubs/research_reports/RR1510.html
