Lawyer Loses His Retirement Savings in “Government Investigation” Scam
Category: Financial and taxes in retirement
Sept. 1, 2024 –You could write a best seller on the ingenious ways criminals use to steal money from people, especially those over 60. These crooks capitalize on a sense of trust to drain senior retirement accounts with ploys like asking for help on stamping out corruption, or rescuing a relative or friend in trouble.
Folks 60 and over are often targeted by cybercriminals because they are such a rich source of funds. Among all age groups in 2023, people over 60 lost more than $3.4 billion from scams, according to the F.B.I.
Per the New York Times, retired attorney Barry Heitin lost almost all of his retirement savings, $740,000, to an incredibly complicated scheme. Criminals persuaded him that he was helping out with an important government investigation, so he spent months and many hours draining his accounts, where the money vanished into the black hole of the Internet. What’s more, he owed the IRS taxes on his “withdrawals”.
Cybercriminals use dating sites, social media accounts, malicious software, and messaging apps to look for targets to steal from. They use elaborate setups that persuade victims to deposit funds into an account “to protect their money”. Sometimes it is an impersonator whom the victim falls in love with, and asks to send money to help with their troubles or to fund a visit.
In the case of Mr. Heitin, criminals started by hacking into his 401(k) account, preventing him from accessing it. What followed was a long and complicated scheme that ended up with his losing almost all of his retirement savings. While his retirement accounts were being drained, criminals were feeding him almost daily reports on the “success” of his efforts to help the government track down other perpetrators. The intricacy, and the imagination, of some of these attacks is so complex that even the most sophisticated person could fall victim.
An advisor tried to help
One of Heitin’s advisors tried to help end the scam. Heiten was given elaborate excuses to cover why he was taking so much money out of his accounts, but one advisor followed up. He discovered Heitin was not buying property in Canada as a “surprise” for his kids. Although the advisor warned Heitin that something seemed amiss, the perpetrators were so skillful that he began to doubt the advisor. Eventually he found a way to transfer the money out, which was quickly lost to the cyberthieves. Adding to his woes, he is liable for taxes on the amounts withdrawn from those retirement accounts.
Gold, cybercurrency, and gift cards
Criminals don’t want to get caught or have the money they steal recovered. So in addition to having victims create new accounts, they also ask for the funds in untraceable form – gold, cybercurrency, and gift cards. That alone should be a warning, if anyone asks for help in that form – run!
Bottom line
Fortunately, we have heard of other cases where a banker or financial advisor stepped in to save a victim from some type of scam. Be wary if someone asks for help and wants you to keep it secret. If an advisor, banker, family member or friend raises warning flags – pay attention. Read the incredible saga of how Mr. Heitin was duped.
Comments? Have you been a victim of cybercrime? If so we’d like to hear about it.
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Comments on "Lawyer Loses His Retirement Savings in “Government Investigation” Scam"
Admin says:
Just learned about another scam to be aware of. Emails that look like they are from the Social Security Administration saying your SS number has been compromised (or other problem). There is an attachment which they want you to open, which can really compromise your account! Be suspicious, the SSA doesn't send email with problems. If it looks suspicious, don't open it and definitely not an attachment. Don't email back or call any numbers. If you are worried, contact the SSA directly.
UncleAL says:
...attorney losing money....oh well........
John says:
Just goes to show you can’t be smug about “this could never happen to me”. These crooks are wily and anyone could get fooled. Keep your guard up!
Patricia says:
UncleAL - really?
ksw says:
Fear and greed are at root cause of most schemes.
Admin says:
Amen to fear as a motivator. On Saturday I came in as a friend was on a long phone call. It was Chase calling to tell him there had been some large charges made to his card, some of them international.
My friend was really upset, but the guy on the other end, who had a foreign accent, wouldn't let him go. He told him his credit and identity were being stolen, and kept asking to verify his personal and financial info, most of which the caller knew. That included recent charges on his credit card, most of his SSAN, where he had lived etc. My friend was in a panic - about to lose everything.
The call went on for over an hour. Finally my friend used my phone to call the real Chase (phone number on card), who said there had been NO unauthorized charges. The original rep overheard some of that conversation and told him, "looks like you just called our company, I can help you as well as them". After some discussion my friend finally hung up on the first caller, and asked for a replacement card from the real Chase. At my urging he called Experian to lock his credit. That way it would be difficult for the scammer to take out a loan or apply for credit card.
Hard to know exactly what the scammer was after - probably identity theft or to try to sell some credit protection service. Bottom line: My friend is pretty sophisticated, but this scammer was so skillful he was taken in. If someone calls you with a problem, hang up and call the real company. The IRS, Social Security and banks won't be calling - they write letters or possibly a text (don't always trust those). Don't give out any new info to a caller unless it is the usual verification question. The more the caller wants, the less likely it is legit!
Mike says:
Admin, Chase offers multiple text and email alerts about account activity including international purchases. I use them all. I don't understand with all the information about scams that someone would not hang up and call the known number tied to their account.
Admin Comment: Yes, it is hard to believe. But I walked in on the conversation and I can tell you the look of fear in my friend's eyes. The fear that he was somehow going to be cheated took over his normal sense of caution. Fear is a very powerful motivator - don't let it happen to you!