How to Make a Family Financial Fraud Plan

Older adults have become a favorite target for financial scammers. The Federal Trade Commission recently reported that adults at least 60 years old reported losing $2.4 billion to scammers in 2024. And that’s just people who knew—and took the time— to report a financial scam. The agency estimates that total losses could be more than $80 billion.

This financial threat is so prevalent, and the fraudsters are so good at tricking people, that I strongly believe every family should create a financial fraud protection plan that helps older family members avoid being taken in by a scam.

I want to be clear about two important things:

• This is not about adult children taking over. It is about parents retaining financial independence, while also adding an important layer of protection: running all major financial decisions by their adult children. Not for permission, but for a reality check and help to make sure that any new investment being considered is indeed legit.

• The problem is not just a scammer getting credit or debit card info and making unauthorized purchases or withdrawals. Criminals have become incredibly sophisticated. It is now more common for scams that involve criminals posing as legitimate financial types, who then talk up a can’t-miss investment idea. Or they pose as someone from a financial institution that someone already has an account with (they have stolen this information), which lowers the defenses of the account holder, who then can be more likely to fall victim to the scam being pitched. And that scam can be talking them into an investment, or playing on their fears.

Sometimes a criminal will pose as the fraud-protection department, and tell someone there is a threat to their account, and then talk them into moving it into a “safe” account….which ends up being a scam account, and the money is lost.

I can’t overstress how important it is to create a family line of defense.

Here’s how to get started:

1. No parent should agree to any new financial decision (even if someone is claiming there has been fraud on their account) without first contacting an adult child. Whether the parent received a letter in the mail, an email, or a phone call, the process needs to be the same: Slow down. Do nothing. Call the adult child(ren) for a family chat.
2. If the communication the parent received seems to be from a financial business that the parent has an account with, do not use any of the phone numbers, emails, or web addresses in that communication. Treat the communication as potentially fraudulent—so don’t use any information on it.
3. Log into the actual account, or call the phone number you know is legitimate (it will be on a statement). Ask for the fraud protection department. Then explain what you have received. If it is fraud, you have just protected yourself.
4. Consider adding an adult child to every financial account. I know this can be hard for some to consider. Again, this is not about losing independence. It is about financial protection. Having an adult child authorized to check your accounts and receive notifications of large transactions is a good layer of personal security.
5. Get a durable power of attorney for finances, if you don’t already have one. The reality is that many financial institutions won’t talk to anyone who is not the account holder, without legal proof that they are authorized to step in for the account holder. That is what a power of attorney for finances enables, and it is one of the essential documents you can easily create with the MUST HAVE® Documents online program that I highly recommend everyone get.
6. Most importantly, I want everyone in the family to approach the financial fraud protection plan as a sign of strength and smarts. None of us is immune to aggressive and sophisticated financial fraud. To ask for help, to create a family plan, is how you do your very best to protect those you love most.