Why Retirement Savers Are Targeted
Retirement accounts represent decades of accumulated savings — often the largest financial asset a person has. Scammers know this and specifically craft schemes to access these funds. Adults aged 50–70 lose more money to investment fraud than any other age group.
The Most Common Retirement Fraud Schemes
1. Imposter Investment Advisors
Someone contacts you claiming to offer a "guaranteed" high-return investment opportunity. They may seem professional, use official-sounding firm names, and even show fabricated account statements. The warning signs: unsolicited contact, guaranteed returns, pressure to decide quickly, requests to move money outside your existing accounts.
2. Rollover Fraud
When leaving an employer, you have 60 days to roll over your 401(k) to avoid taxes and penalties. Scammers impersonate financial institutions to intercept these rollovers. Always verify rollover instructions directly through official contact information — never follow instructions from an unsolicited call or email.
3. Ponzi and Pyramid Schemes
Returns appear consistent and above-market because early investors are paid with later investors' money. Red flags: consistent above-market returns regardless of market conditions, complex or secretive strategies, difficulty withdrawing money.
4. Social Security Scams
Callers impersonate the Social Security Administration, claiming your number is "suspended" or involved in illegal activity. The SSA never calls to threaten suspension of benefits. Hang up immediately.
5. Medicare Fraud
Callers offer "free" medical equipment, tests, or services in exchange for your Medicare number. Your Medicare number is as sensitive as your Social Security number — never share it unless you're receiving care from a verified provider.
How to Protect Yourself
- Verify before you act: Any request to move money deserves independent verification. Hang up and call back using a number you find yourself — not one given to you by the caller.
- Register on the Do Not Call list: donotcall.gov — though legitimate registrations only block legitimate telemarketers, not scammers.
- Check credentials: Any investment advisor should be registered. Verify at brokercheck.finra.org (for brokers) or adviserinfo.sec.gov (for investment advisers).
- Review statements regularly: Check your 401(k) and bank statements monthly. Unauthorized transactions should be caught and reported quickly.
- Be skeptical of "guaranteed" returns: No investment guarantees above-market returns without risk. If it sounds too good to be true, it is.
- Talk to someone you trust before large financial decisions: Scammers create urgency to prevent you from consulting others. A legitimate investment will still be available tomorrow.
Report It
If you suspect fraud, report it immediately:
- FTC: reportfraud.ftc.gov
- SEC (investment fraud): sec.gov/tcr
- Your state's Attorney General or financial regulator
- KCCU — if you believe your accounts may be compromised