By Elizabeth O'Brien
Many of us—admit it—feel just a tad smug when we hear about investment scams. “I would never fall for that,” we think—to which a story in the most recent issue of AARP The Magazine offers a big “Oh yeah?” In “Confessions of a Con Artist,” a veteran scammer, identified only as Jim, tells writer Doug Shadel how he bilked investors out of millions through bogus investments in attractive-sounding assets like gold coins and oil and gas leases. The guy was a pro, an expert at identifying his victims’ hopes and weaknesses and preying on them. “I didn’t want to talk to stupid people,” he says, “because stupid people don’t have $50,000 lying around to give me.”
Seniors proved a particularly vulnerable target, Jim says: “Their emotional needs are closer to the surface. They aren’t afraid to tell people how much they care about their kids and grandkids. They aren’t afraid to share their fears about the unstable financial markets and how much they worry about being on a fixed income.” (All the more so, presumably, when low interest rates and a weak economy are holding down that income.)
Jim, now in his mid-40s, eventually got caught and did time. Still, this is chilling stuff, and the problem remains pervasive. Since 2011, the Justice Department’s Criminal Division and 85 U.S. Attorneys’ offices have reported that some 800 defendants have been charged, tried, pleaded or sentenced in about 500 federal prosecutions involving investor fraud. The total amount reported cheated from victims tops $20 billion. The Justice Department is holding investor fraud summits around the country this month. Learn more here.