How to Protect Clients from ‘Tinder Swindlers’

How many of you watched the documentary “The Tinder Swindler” on Netflix? It premiered in February 2022 and quickly climbed to the top of Netflix’s Top 10 list, amassing over 45 million viewing hours within its initial weeks. The documentary remained in the Top 10 for several weeks, underscoring its widespread appeal and the public’s fascination with the story of Simon Leviev, who conned women out of millions by posing as a wealthy, jet-setting businessman.

Interestingly, many of these victims were young women without significant assets, highlighting a disturbing trend that only worsens with age and wealth. Women over 40 are most at risk.

Client Alert: Scammers Disguised as Suitors

Companionship is a basic human need, and this desire can become even more pronounced as we age. After experiencing a loss through death or divorce, it’s natural to seek new love. However, it’s crucial to be cautious about where and how you meet new people.

Widows and divorcées, in particular, can be prime targets for online romance scammers. These bad actors often weave themselves into your life with charm, but once they’ve gained your trust, they aim to steal more than just your heart. Data from the Federal Trade Commission (FTC) reveals that individuals aged 60 and above lost $139 million to romance scams in 2020, a significant jump from$84 million in 2019.

Unfortunately, I have firsthand experience with this, having once been married to a con man.

To protect hard-earned savings, I encourage clients to be hypervigilant about any new potential partners, especially those met online. If someone starts asking them for gift cards, shares heart-wrenching stories about sick grandchildren or tries to convince them to make financial changes, I believe they should cut off communication immediately.

Additionally, clients should report suspected fraud to the FBI’s Internet Crime Complaint Center.

Read ‘Get Rich Quick’ as ‘Too Good to Be True’

Romance scammers aren’t the only predators targeting older women’s finances. Often, these scams follow a familiar pattern: An acquaintance offers an investment opportunity that seems too good to be true, claiming it will yield substantial profits quickly. Despite initial doubts, your client might take the bait, only to find out later that their money was used to pay off earlier victims in a Ponzi scheme.

I believe a portfolio of carefully vetted investments is key to long-term financial goals, but beware — there are no legitimate “get rich quick” schemes. Look for red flags like unprofessional websites, requests for personal information, a lack of references to third-party custodians, and scant information on mainstream financial sites. If it seems too good to be true, it probably is.

What is a Romance Scam?

A romance scam involves fraudsters creating fake online identities to establish romantic relationships with unsuspecting victims, with the ultimate goal of stealing money or personal information. Here’s how it typically:

1. Fake Profiles: Scammers create attractive, convincing profiles on dating websites, social media platforms, or other online communities.
2. Emotional Manipulation: They quickly profess love or strong emotions, sharing fabricated stories to build trust and emotional dependence.
3. Isolation: Scammers encourage victims to communicate privately through email, messaging apps or phone calls, isolating them from potential external scrutiny.
4. Requests for Money: Once trust is established, scammers fabricate emergencies or investment opportunities. They may ask for money for medical emergencies, travel expenses or business investments.
5. Continuous Deception: They often request increasing amounts of money, creating elaborate stories to justify their ongoing They may send small gifts to their victims to build credibility.
6. Avoidance of In-Person Meetings: Scammers make excuses to avoid meeting in person or through video calls in order to maintain their deception.

How Many Women Fall Prey to Romance Scams?

Romance scams are widespread and affect many individuals worldwide. Here are some points to keep in mind:

1. FBI Statistics: The FBI’s Internet Crime Complaint Center (IC3) reported that romance scams cost victims in the U.S. over $600 million in 2020 alone. The number of reported cases continues to rise each year.
2. FTC Statistics: The FTC noted that in 2020, consumers reported losing a record $304 million to romance scams, with women being more frequently targeted than men.
3. The Biggest Targets: Women over the age of 40, particularly those who are divorced, widowed, or disabled, are often more vulnerable to these scams.
4. Global Impact: Romance scams are a global issue affecting individuals across various countries and demographics.

Factors Contributing to Vulnerability

More of your clients may be potential targets than you realize. Consider the following:

1. Emotional Manipulation: Scammers are skilled at exploiting emotional vulnerabilities, particularly targeting those who may be lonely or seeking companionship.
2. Isolation: Social isolation can make individuals more susceptible to forming quick and intense online relationships.
3. Lack of Awareness: Many victims are not aware of the prevalence and tactics of romance scams, making them easy targets.
4. Trust: Women who are naturally trusting or empathetic may be more likely to believe the fabricated stories and pleas for help from scammers.

Preventive Measures

Here’s how you can help your financial planning and wealth management clients:

1. Awareness and Education: Educate potential victims about the signs of romance scams because this can significantly reduce their risk.
2. Verification: Encourage individuals to verify the identity of online contacts through video calls and independent research.
3. Skepticism: Promote a healthy level of skepticism about online relationships and requests for money.
4. Support Networks: Encourage your clients to maintain open communication with their friends and family about online relationships. This can provide additional layers of protection.

By understanding romance scams and spreading awareness, we can help reduce the number of individuals, particularly women, who fall victim to these fraudulent schemes. As financial professionals, we are the frontline in protecting our clients, and we should be doing more to safeguard their interests.

Cary Carbonaro, CFP®, is a Managing Wealth Advisor and the Women and Wealth Ambassador at Ashton Thomas Private Wealth. She advocates for women in the financial industry, which she has been part of for more than 25 years. Her first book, “The Money Queen’s Guide: For Women Who Want to Build Wealth and Banish Fear,” is available through major book retailers. Her second book, “Women and Wealth: A Playbook to Empowering Clients and Unlocking Their Fortune,” is slated for publication by Wiley in Spring 2025.