How Scammers Target Vulnerable Populations

 

In 2019 the Federal Trade Commission (FTC) reported approximately $2 billion in losses due to scams targeting private individuals, with estimates for 2020 appearing significantly higher. While loss due to scams is widespread and harmful, scams can be especially devastating to the most vulnerable members of society. Scams that specifically target vulnerable populations often go unreported and remain outside the public eye.

Due to limited legal and social protections, immigrants and the poor are often easy targets for unscrupulous scammers. Having seen the gamut of fraud and scams, SDC CPAs (formerly Studler Doyle) aims to bring awareness to some of the scams that prove most harmful to vulnerable populations.

 

Immigration Scams

Predatory scams against immigrants are common occurrences with the potential for particularly destructive consequences. During recent periods of anti-immigrant movements, scammers seized opportunities to exploit immigrants’ fear and need for advocacy. A common scam involves individuals falsely claiming to be lawyers or immigrant advocates while charging exorbitant rates and not providing any services.

In these cases, immigrants may be misled, manipulated, and even blackmailed by these phony representatives. Knowledge of the victim’s immigration status and the threat of deportation can often be weaponized against the victim as a means to deter reporting and further exploit individuals.

In an especially cruel twist, falling victim to these scams can lead to immigrants being deported or having their immigration delayed.

 

Lending Scams

Lending scams tend to target individuals living in poverty by offering a quick fix. These scams typically work by providing immediate cash at interest rates as enormous as 500%. In many cases, these loans force the individual deeper into debt and can create a cycle in which loans to fix an immediate problem consume peoples’ entire paychecks, leaving them in need of more loans.

According to Dana Sweeney, a representative of the Alabama Appleseed Center for Law & Justice, approximately two thirds of the population of the US lives in states where payday lending is legal and, in some places, almost completely unregulated. In states where payday lending is illegal, the practice may continue underground and even further from the public eye.

Even in circumstances in which payday loaning itself is legal, exploitive and dishonest practices – such as misrepresenting interest rates and timelines – present a distinct threat to people in poverty.

While scams targeting vulnerable populations are unconscionable, they are not impermeable. SDC CPA believes that raising awareness and calling attention to these predatory practices is one of the first steps to facilitating change.