Educating the elderly about financial scams
06/18/09 5:50PM By Bob Kinzel
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(Host) According to a new study, a growing number of older Vermonters are being victimized by investment fraud and other financial scams.
As VPR's Bob Kinzel reports, a group of consumer organizations has launched a campaign to alert elderly Vermonters about the schemes.
(Kinzel) Lt. Robert Kalinoski is a veteran member of the Vermont State Police. His father is the victim of investment fraud.
Kalinoski decided to go public with his story with the hope that other people will learn from his mistakes.
It's a case where his father made loans and investments to an unlicensed individual who promised high rates of return for the payments.
Kalinoski says the fraudulent investor was very clever in setting up his scam:
(Kalinoski) "Just because this is Vermont, everybody thinks it's a safe rural state - this can't happen under my nose. I've been in the state police for 24 years and I wasn't able to protect my father from this. I saw him becoming vulnerable, but I didn't realize to what extent and this happened you know right in front of my family and I."
(Kinzel) John Gannon is the outreach director of the FINRA Foundation, a group that educates the public about investment fraud. He says this type of criminal activity has increased during the current recession:
(Gannon) "We're seeing more and more instances of investment fraud popping up, either because of them being uncovered because of the economic climate and also new ones coming up because people are looking for alternatives to the stock market and other investments which aren't necessarily giving them the rate of return they would like."
(Kinzel) Gannon says consumers can protect themselves by dealing only with licensed financial professionals. His says many victims never take this step:
(Gannon) "We did a survey not too long ago of known victims of investment fraud. And unfortunately 80% of those people didn't take a single step to check out to make sure they were dealing with a licensed investment professional or buying a registered product. And if they had taken those steps they would have probably walked away from that fraud. So it's not hard to do - it doesn't take a lot of time, we just need to get people to do it."
(Kinzel) The Vermont chapter of AARP plans to highlight the issue of investment fraud at regional workshops over the course of the summer and fall.
For VPR News I'm Bob Kinzel in Montpelier.