Protect Your Retirement: Avoiding Frauds and Scams

By:  Ray Kirk, Ph.D., Federal Benefits Specialist

Published: April, 2022


Following the legendary Willie Sutton principle, fraudsters tend to go “where the money is”—and that means targeting older Americans who are nearing or already in retirement. Federal employees and retirees with large Thrift Savings Accounts are tempting targets. Knowing how to protect your savings is an important part of financial literacy.


Every two years the Society of Actuaries Research Institute conducts a retirement risk survey to evaluate Americans’ retirement concerns and preparedness, their income and spending in retirement, how they plan for change in retirement, the impact of shocks and unexpected events, and their views on health and caregiving.

The 2021 Retirement Risk Survey found the biggest retirement concern for both pre-retirees (43%) and retirees (47%) is being the victim of fraud or a scam. This is the one area in the survey where pre-retirees and retirees concerns have gone up since the 2019 survey.


Two actions you can take to protect yourself are to get and review your credit report and to actively guard against frauds and scams.


Federal law gives you the right to get a free copy of your credit report every 12 months. Everyone in the U.S. can get a free annual credit report from all three national credit bureaus (Equifax, Experian, and TransUnion) at You may see other offers for free credit reports on the Internet but is the only website authorized to fill orders for the free annual credit report you are entitled to under Federal law.


Getting your credit report can help protect your credit history.  Review your credit reports for mistakes, errors, or signs of identity theft or other fraud affecting your credit records such as loan applications and credit cards you have not applied for.


FINRA is a government-authorized not-for-profit organization that oversees U.S. broker-dealers. FINRA is dedicated to protecting investors and safeguarding market integrity in a manner that facilitates vibrant capital markets.


We’ve all heard the timeless warning “If it sounds too good to be true, it probably is.” It’s great advice, but the trick is figuring out when “good” becomes “too good.” And if you have a good salesperson—or worse, a dishonest one—it gets really hard.


The FINRA website provides Investor Alerts and other resources that can help you build knowledge and avoid problems such as the latest frauds. In just four questions FINRA’s Scam Meter will help you tell if an investment you are thinking about might be a scam.


In FINRAs bulletin “Avoid Fraud” (see link in resource section below) FINRA cites, “fraudsters use high pressure and a number of tricks-of-the-trade to entice you to invest.” FINRA has named and described the following tactics commonly used as follows:
  • The “Phantom Riches” Tactic—dangling the prospect of wealth, enticing you with something you want but can’t have. “These gas wells are guaranteed to produce $6,800 a month in income.”
  • The “Source Credibility” Tactic—trying to build credibility by claiming to be with a reputable firm or to have a special credential or experience. “Believe me, as a Senior Vice President of XYZ Firm, I would never sell an investment that doesn’t produce.”
  • The “Social Consensus” Tactic—leading you to believe that other savvy investors have already invested. “This is how ___ got his start. I know it’s a lot of money, but I’m in—and so is my mom and half her church—and it’s worth every dime.”
  • The “Reciprocity” Tactic—offering to do a small favor for you in return for a big favor. “I’ll give you a break on my commission if you buy now—half off.”
  • The “Scarcity” Tactic—creating a false sense of urgency by claiming limited supply. “There are only two units left, so I’d sign today if I were you.”


Exercise due diligence before making an investment. Ask questions, ask for and check references, and verify the salesperson is a registered dealer.  All brokers must be licensed and registered by FINRA. You can verify information about brokers and brokerage firms in FINRA’s BrokerCheck®.


If you believe you’ve been defrauded or treated unfairly by a securities professional or firm, file a complaint. Through its Complaint Program, FINRA investigates complaints against brokerage firms and their employees. FINRA is empowered to take disciplinary actions against brokers and their firms. Sanctions may include fines, suspensions, bar from the securities industry or other appropriate sanctions.


You can also submit a tip to FINRA if you suspect you or someone you know has been taken in by a scam or other potentially fraudulent, illegal or unethical activity. 


The Federal Trade Commission (FTC) also provides advice on recognizing common signs of a scam to help you avoid falling for one. The FTC provides advice on what to do if you were scammed or gave someone you think is a scammer some personal information, or if they have access to your phone or computer.


You can report suspected fraud to the FTC. They will work with other government agencies (Federal, state, local, international) to investigate complaints, coordinate law enforcement investigations, cooperate with oversight investigations, or follow up on ID theft reports.


Protecting yourself against frauds will help you retain your retirement resources for your retirement not some scammers’ retirement.




Dr. Kirk is a former Federal employee with over 40 years of Federal Service, 34 years of which were with the Office of Personnel Management. He was the Manager of the Benefit Officers Training and Development in Retirement Services for the last 12 years of his career.


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