Over a period of five years “Jeremy,” a con artist now doing time, worked a number of gold coin scams.
“We would tell people that gold would absolutely double in value in the next one to two years and that the prospect would be able to rely on it making them far more money than any other investment vehicle,” he said from his jailhouse cell. What he failed to disclose was that he was selling the gold at up to a 500 percent markup.
Identity theft, investment fraud and scams rob millions of Americans of their hard-earned money every year. Research shows that more than $20 billion was stolen from about 13 million victims in 2012, according to the latest Javelin Strategy and Research reports on identity fraud. Older adults tend to be bilked out of about $3 billion every year.
Con artists use a myriad of scams to steal your money, including phishing scams, tech-support scams, gold coin scams, oil and gas scams, sweepstakes and lottery scams, grandparent scams and many more. Although their methods are different, research shows that the tactics scammers use are the same.
When authorities ask convicted con artists to describe the trick to scamming people out of money, they all say the same thing: “Get them under the ether.” The ether is a heightened emotional state that makes it hard to think clearly and make rational decisions. Con artists ask questions that trigger an emotional response. Once they find something you care about that triggers emotions, they will “throttle up” on that trigger and get you to focus on it until you are in a heightened emotional state and ready to open your wallet.
“Rocky” is a con man who worked as a consultant to a number of fraudulent boiler rooms. In these operations telephones are set up to steal millions from people and then the shop is quickly closed and the money gone. Rocky said the ether is a condition that a master closer puts a prospect in by hitting their fear, greed and urgency buttons.
“I wanted to keep the victim up in the altitude of the ether because once they drop into the valley of logic, I’ve lost them,” he said.
Another tactic con artists use is making a personal connection with a potential victim. Scammers will develop a victim profile by asking a series of personal questions so they can find your emotional trigger. Once they wrap you in emotion that blurs your logic, they’ve endeared you to them and you begin to trust them.
Con artists also use a tactic they call “phantom riches,” meaning something you want, but can’t have. The con artist will dangle that phantom in front of you in order to get your emotion up so you will make an impulsive decision. Researchers say this is the number one tactic found in undercover audiotapes of con pitches.
Scarcity is yet another tactic. It is the idea that if something is rare or scarce, it must be more valuable. The con artist will paint a picture that the offer is rare or available only for a limited time.
A common tactic to reel you in typically goes something like this: “Now John, back in 1860 from the Philadelphia mint, there were 22,625 of these coins minted. Of those 22,000, only four have survived. Only four for God’s sakes, just four remain and are available only from me.”
This information and more can all be found in the Con Artists Playbook. The Con Artist’s Playbook is part of the Fraud Watch Network, which contains this interview and others, along with access to information to help protect people from theft and fraud.
The Fraud Watch Network gives you free access to information about how to protect yourself and your family. Membership is not required. It’s free and open to everyone – members, non-members and people of all ages – and it allows access to talk to a real, live person, learn about active scams and find resources about what to do to spot and avoid them.
Bob Gallo is Illinois state director of AARP, which is committed to protecting your money through the Fraud Watch Network. Get up-to-date information, watchdog alerts and more by visiting aarp.org/fraudwatchnetwork or call 877-908-3360.
This article appears in Capital City Senior July 2015.
