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OISE study dispels myths about older victims of fraud, shows cognitive skills main factor

Research shows income, education, trust do not play significant role

By Lindsey Craig

April 17, 2017

Worried elderly couple looking at a cell phone

Photo from Shutterstock

Each year around the world, thousands of people are victimized in fraudulent marketing scams. Sadly, for various reasons, senior citizens are most targeted.

It’s commonly believed that older people fall victim to such scams due to various vulnerabilities, loneliness and demographic factors such as gender, income, education and trust. But new research from the Ontario Institute for Studies in Education (OISE) at the University of Toronto shows poorer cognitive skills used in everyday activities to be the main determinant.

“The results of this study were very surprising – they dispel a common belief about why some older people fall victim to fraud,” said one of the study’s lead authors, Dr. Kang Lee, professor at OISE’s Jackman Institute of Child Study and Tier 1 Canada Research Chair.

“People often think things like loneliness or trusting behaviours are the culprit,” said co-lead author and OISE doctoral researcher Rebecca Judges. “But this study shows that cognitive factors – not social factors – are the biggest difference between older adult victims and non-victims.”

The study, "The Role of Cognition, Personality, and Trust in Fraud Victimization in Older Adults," also conducted with researchers from Ryerson University, was recently published in the journal, Frontiers in Psychology.

The study involved participants in Ontario aged 60 and older who had not been diagnosed with a cognitive impairment. They each lived independently in their communities.

Participants were asked about 15 common types of consumer and mass marketing fraud including weight loss scams, advance free loans, lottery fraud, and emergency (or grandparent) scams.

Skills required to think, learn and reason

Researchers explained that cognitive abilities are the skills required to think, learn and reason. These skills can include being able to perform simple calculations in one’s head, follow a conversation from start to finish, and remember events that took place over the past month.

“The same abilities that enable someone to do these tasks well may also be important for identifying and avoiding scams,” Dr. Lee explained.

Support needed to prevent decline of cognitive skills

Ryerson University researcher Dr. Lixia Yang, who collaborated on the study along with PhD student Sara Gallant, said the results can play an important role in the prevention of fraud victimization in older people.

Judges agrees.

“For example, identifying the most important skills needed in financial decision-making and then working to prevent cognitive decline in those key areas could make an impact,” she said, also suggesting additional support be provided to those experiencing cognitive decline.

Conscientiousness, honesty, also a factor

While the study’s key finding involved cognitive skills as a factor, results also showed that older victims are also less conscientious and less honest than non-victims of the same age group. 
 Researchers say highly conscientious people carefully consider consequences of their actions, are very thorough in their work, and tend to work hard to achieve their goals. People with very low levels of conscientiousness, however, tend to act on impulse and neglect small details in their work and daily activities.

“These tendencies could cause them to impulsively agree to a scammer's requests, and ignore the minor details that could indicate a scammer's malicious intent,” said Judges.

Dr. Lee also noted that people who are extremely honest are more likely to be genuine and avoid corruption, while people with very low levels of honesty tend to be motivated to break rules and manipulate others for personal gain.

“It’s possible that less honest individuals view a scam as a way to experience personal financial gain in an unconventional way, and may not be as adverse to the underhanded nature of some scams,” he said.

Canadians aged 60-69 most frequently targeted 

Despite efforts to prevent fraud victimization, people in Western nations are collectively losing billions of dollars according to consumer groups like the U.S. Federal Trade Commission, Canadian Anti-Fraud Centre, and others.

In 2014, Canadians lost a reported $74 million to mass-marketing scams alone, and 60-69 year olds were the most frequently targeted group, according to the Canadian Anti-Fraud Centre. In the same year, Americans lost $1.7 billion to various scams, according to the Federal Trade Commission, while the Australian Competition and Consumer Commission reported losses of $82 million due to fraud.