The scammers, who pose as a grandchild or police officer, tell family members that there has been an arrest or injury, often using specific details that they have collected from social networking sites such as Facebook.
A common reaction of most caring grandparents is one of extreme alarm and they are willing to do what they can to help their grandchildren get out of trouble.
This is the perfect time for scammers to make their request of hundreds of dollars to be sent via Western Union or a similar service.
Instead of the money being used to benefit the well-being of their grandchild, it is wired to a thief never to be seen again.
Thousands of New Jersey residents and others across the country have fallen into the "Grandparent Scam" trap.
In 2010, The Federal Trade Commission received more than 60,000 complaints regarding the "Grandparent Scam" and other similar scams. New Jersey held 1,549 of those complaints, with $3,500 lost by each New Jersey resident fooled by the scam according to The State Division of Consumer Affairs.
Attorney General Paula T. Dow, the State Division of Consumer Affairs, and the Consumer Federation of America have launched a nationwide public campaign to stop the scammers in their tracks before they can reach any others.
"Scams in which criminals prey on senior citizens, manipulating their fears and stealing their savings, are among the most malicious in our society. New Jersey is proud to stand with the Consumer Federation of America, in launching a nationwide campaign to expose this crime and help senior citizens learn to protect themselves," says Attorney General Paula T. Dow.
The announcement was made at Home Sweet Home Adult Medical Daycare in Elizabeth, New Jersey and included a two minute educational video produced by the Consumer Federation of America with the support of Western Union.
The video and other tips regarding the "Grandparent Scam" can be found on the website, www.consumerfed.org/fraud.
"The Division of Consumer Affairs is committed to protecting our senior citizens from those criminals who view seniors as easy marks, who aim to prey on their generosity and kindness, who seek to profit from a grandparent's anguish," says Thomas R. Calcagni, Acting Director of the New Jersey Division of Consumer Affairs. "We are warning all of New Jersey's seniors and their loved ones to be wary and watchful of these scams," he adds.
The event at Home Sweet Home also featured Jim and Dorothy, a couple from Wayne, New Jersey. They had been targeted by the "Grandparent" Scam by phone on February 15, 2011. The caller pretended to be their grandson and falsely claimed that his nose had been broken causing a difference in his tone of voice.
The caller continued to tell Jim and Dorothy that he was in a Canadian jail, pleading with them to keep it a secret from his mother until after his court appearance. The couple was prepared to fork over $2,800 that had been requested for bail. Luckily, their suspicious daughter questioned their actions before any money was sent.
"The key to protecting consumers from fraud is public awareness. We hope that our new video and tips about the grandparent scam will help consumers in New Jersey and across the country avoid being tricked out of their money," says Susan Grant, Director of Consumer Protection at the Consumer Federation of America.
Most of the scammers claimed to be calling from England or specific places in Canada such as Montreal, Toronto, Ontario or Vancouver.
The Grandparent Scam and other impostor scams come in many varieties. Some common factors include:
The Division of Consumer Affairs and Consumer Federation of America offer the following very simple tips to prevent senior citizens and others from being victimized:
ADDITIONAL RESOURCES: NJ Division of Consumer Affairs:
The State Division of Consumer Affairs has created a new Consumer Brief about the Grandparent Scam, available at http://www.njconsumeraffairs.gov/brief/grandscam.pdf .
Detailed information about the Consumer Affairs' FedUp (Senior Fraud Education & Protection Program) presentations for New Jersey senior citizens is available at the Division's website, www.NJConsumerAffairs.gov/fedup/ . Groups interested in requesting a FedUp presentation can call Margaret "Peggy" Anastos of the State Division of Consumer Affairs at 973-504-6241.
Consumers who believe they have been cheated or scammed by a business, or suspect any other form of consumer abuse, can file a complaint with the State Division of Consumer Affairs by visiting its website, www.NJConsumerAffairs.gov , or by calling 1-800-242-5846 (toll free within New Jersey) or 973-504-6200.
Consumer Federation of America:
For further information from the CFA, including the "Grandparent Scam Informational Video," visit www.consumderfed.org/fraud. The New Jersey Division of Consumer Affairs is adding the video and tips to its presentations. The CFA is providing the video to consumer agencies and organizations nationwide, for use in their community outreach.
The Consumer Federation of America is an association of nearly 300 nonprofit consumer organizations and consumer agencies that was established in 1968 to advance the consumer interest through research, advocacy, and education.