“Grandma!” a female voice exclaimed when Helen answered the phone.
“Britney? Is that you?” Helen asked.
So started a phone conversation that turned into a costly, three-day swindle. This story was recounted to me recently by members of my extended family. For the sake of their privacy, I have changed the names.
“Grandma, I am in real trouble,” the caller said. “I am at college and I have gotten into a car accident. I hit two cars in a parking lot. I am with a lawyer who believes we can settle with the insurance company. Grandma, I want to handle this situation on my own. I don’t want to let my parents know what’s happened. I want to show them I can handle this by myself. Can you help me without calling my parents? I am going to put the lawyer on the phone to talk to you.”
So the female scammer handed the phone to a male accomplice.
In a soothing, confident voice, he explained he was an attorney and that the young woman needed to put up some money to stay out of jail.
“Would you be able to send her $10,000?” the scammer asked. “It has to be cash.”
“Yes,” Helen said. “But how will I get it to you?”
“Send it by UPS; let me give you instructions.”
“No, no. Can’t you send someone to pick it up?”
“Maybe. Let me call you back. In the meantime, don’t talk to anyone about this. Okay?”
“Okay.”
The scammer called back within a few minutes and said he would send a driver to pick up the money. Helen gave the caller her home address. The scammer said the driver would identify himself.
So Helen drove to the nearest branch of TCF Bank, where she had a checking account, and attempted to withdraw $10,000. The teller said they were low on cash and could only give her $5,000. When the scammer called back, Helen told him she was only able to withdraw $5,000. He told her to drive to another branch.
“If they ask why you are withdrawing the money, tell them you are paying off some contractors who are doing work on your house,” the scammer instructed.
Helen drove to another TCF branch, where they were able to fulfill the remaining $5,000 withdrawal request.
“What are you using the money for?” the teller asked.
“I am paying some contractors who are working on my house,” Helen lied.
Soon after arriving home, Helen put her stack of hundreds and fifties in an envelope and waited for the driver to arrive. Within a few minutes, he showed up, parking a long way from the front of the house. The driver identified himself as the “lawyer” said he would, and Helen handed him the money. She asked for a receipt but he said he didn’t have one and walked away.
Helen eagerly picked up the phone the next day when the scammer called back. She asked to speak to “her Britney,” and he put her on.
“Britney, how are you?”
“Good, Grandma, thanks for helping me,” the imposter said.
“Where are you?”
“In the lawyer’s office.”
“Where did the accident happen?”
“At McDonalds… Oh, my phone is dying… I can’t hear you.” Click. Connection lost.
The “lawyer” called back.
“It is going to require another $15,000 to retain our law firm to see this case through. But don’t worry. When the insurance company pays the claim at the end of the process, they will include the legal costs so you will be reimbursed.”
He instructed Helen to withdraw $15,000 from her bank account and send the money to an associate in Arizona via UPS.
“Put the money in an envelope and put the envelope in a larger envelope and put that envelope in an even larger envelope,” the scammer explained. “Then, put the envelope inside a magazine. Then, find an old sweater you no longer need and fold the sweater, putting the magazine in the sweater. Then, wrap that in bubble wrap and place the whole thing in a UPS box.
“When UPS asks what’s inside the package, tell them documents and a gift. Tell them you want the earliest next-day shipment. Don’t worry about the cost. You will be reimbursed by the insurance company when this is all over.”
So Helen, who had used UPS only a few times in her life — generally to send Christmas presents to relatives on the East Coast — drove to the UPS Store with her package. It cost twice as much to send a package on the first flight out the next day as it did to send the package mid-morning, so reflexively Helen selected the mid-morning option. The scammer’s instruction failed to trump Helen’s life-long bias for thrift, a characteristic baked in during her Depression-era upbringing.
“You shouldn’t have done that,” the scammer said in a phone call later that day. Nonetheless, he praised her. “Nice job, you did everything else exactly as instructed.” Then he told her another five-figure payment would be required to get the job done. This time, he instructed her to use FedEx. He provided a different Arizona address.
The calls, which had begun on a Wednesday morning, continued through Friday. Helen couldn’t sleep. Helen was beginning to suspect something wasn’t right. She was suspicious that Britney talked to her only in brief spurts. And she didn’t like the idea of keeping something from Britney’s parents. On Saturday morning she called relatives, and they called the police. A police officer came to Helen’s home and while he was there, the scammer called. Helen answered the phone and handed the receiver to the police officer, who briefly engaged the caller. But when the police officer identified himself, the scammer hung up and never called back.
Police followed up on the Arizona address used for the UPS delivery, but it was a residence and the people living there said no package was ever delivered. UPS confirmed it did leave a package at the front door, and it is speculated that someone in on the scam immediately came by the address and walked away with the package. That is probably why the caller reprimanded Helen for taking the later delivery time when instructed to use the first flight out that day. That meant the person picking up the package ended up waiting a lot longer to intercept the package than originally planned.
Police noted Helen gave the scammer an opening when she offered the grandchild’s name when the female caller greeted her with “grandma.” Helen said she was surprised by her grandchild’s poise on the phone, and now she realized it could never have been her.
Helen’s family was shocked. Although aged, Helen is very sharp. She does her own taxes, keeps a budget and manages her own investment portfolio. One of Helen’s relatives is convinced the scammer hypnotized her over the phone. Apparently, that’s possible. Certainly the scammer used emotional triggers to manipulate his victim. Helen looks back on the incident with disbelief. “How could I have been so stupid?” she asked.
“You did it because you care about your granddaughter,” a relative reassured.
“The scammer treated me like a five-year-old and, you know,” Helen said, “that’s exactly what I was.”
Bankers work to mitigate scams
Scams aimed at senior citizens are on the rise; bankers are often witnesses, which can put them in a quandary. On the one hand, they are obligated to execute legal transactions initiated by customers, including withdrawals; on the other hand, they can sometimes spot unusual customer behavior which may be an indication of fraud. Increasingly, states are passing laws that give bankers the opportunity to suspend transactions until an investigation can determine whether they involve fraud.
Last spring, the Minnesota legislature passed legislation that gives bankers the ability to put a “hold” on a customer withdrawal. A similar law was passed a couple years ago giving broker/dealers the ability to pause a withdrawal from brokerage accounts. At the urging of the Minnesota Bankers Association and others, lawmakers extended the ability to banks. Importantly, the law also gives banks liability protection in cases where they don’t intervene.
Martin Fleischhacker, a 21-year veteran of the Minnesota Department of Commerce, has been busy since August 1, when the new law kicked in. Fleischhacker is the Department’s chief fraud officer and has conducted dozens of investigations, preventing the pilfering of thousands of dollars.
Fleischhacker said scams typically involve a phoney sweepstakes, someone who fakes a romantic interest in the victim or, as in Helen’s case, someone impersonating a grandchild in trouble. Fleischhacker said the scammer succeeds by establishing an emotional connection with the victim. Scammers usually telephone potential victims, win their confidence, and get them to withdraw large sums of cash from their bank and send it somewhere via FedEx or UPS. Sometimes victims turn over bundles of cash multiple times before they realize what’s going on.
Fleischhacker hears about cases like this all the time. Bankers can now call him if they believe a customer is being victimized. Fleischhacker will call the victim and attempt to understand the situation. He opens the victim’s eyes to fraud in a lot of cases; but in some cases, the victim persists and there is nothing Fleischhacker can do.
An international ring of people running these scams share a money laundering network where funds can be picked up and distributed to the criminals, Fleischhacker said. The scammer in Helen’s case, for example, had a local connection who could drive to the victim’s home to pick up cash, and accomplices in Arizona to pick up deliveries. Fleischhacker said it is impossible to know where the scammers reside, and they could be working from outside the country. Many scammers are able to leverage cell phone relays which result in local numbers showing up on caller ID even when the caller is several states away. Sometimes instead of asking for cash, scammers get victims to buy thousands of dollars worth of gift cards from a store such as Lowes or Home Depot, and then pass on the gift card ID numbers so the scammers can retrieve cash.
Joe Witt, President and CEO of the Minnesota Bankers Association, said he was very pleased the legislature passed the law, given the difficulties the pandemic created for the session this year. There are some 20 states across the country with similar laws.
In neighboring Wisconsin, the Wisconsin Bankers Association has been advocating for a law and made progress last spring when the state Assembly passed a bill. But once the pandemic hit, the bill, like other legislation, stalled. Rose Oswald Poels, WBA President and CEO, said she is looking forward to taking up the legislation in 2021.
As for Helen, a bit of good news. With the assistance of a relative and police, the FedEx shipment was intercepted before it reached its destination and her payment was recovered. Helen said she will no longer answer her phone, but let every call go to voicemail so she can choose to return the message if she recognizes the caller.