Sweetheart Scams: My Mom Was a Victim

Con artists often target people recently widowed or divorced. Here’s how to protect clients, says this advisor.

Marguerita Cheng
Marguerita Cheng

Financial advisors have seen their fair share of money mishaps. But sweetheart scams take it to the next level. Instead of a budding romance and companionship, clients come face-to-face with financial exploitation.

It can happen to anyone. I know because my mom was a victim of a sweetheart scam.

In 2015, two months after my dad passed away, I bought my mom an iPhone to help her connect with friends and family. She had already been somewhat active online and wanted to meet more people.

I encouraged to connect with others at bereavement groups and social events. I also told her she should meet new friends during the day in public places. We had discussions about the dangers of sharing personal information.

Unfortunately, she met someone online who tricked her. He said he was having financial trouble, and my caring, trusting mom wanted to help him out. It cost her several thousand dollars, but it could have been far worse.

The experience made me realize that no one is safe — my mother wasn’t immune, even though my sister is a compliance officer and I serve on the Elder Abuse and Financial Exploitation Prevention Committee in our nation’s capital.

As financial professionals, there’s much we can do. Here’s how to help clients detect and escape a sweetheart scam.

How Sweetheart Scams Work

Sweetheart scams are a type of romance scam that targets lonely people looking for love. Unfortunately, this includes many retired and elderly folks. The Centers for Disease Control and Prevention (CDC) reports nearly one in four adults aged 65 and older are considered socially isolated. And according to the Pew Research Center, 27% of those in the 60 and older group live alone.

Living alone and social isolation make older adults a prime target, and recently divorced and widowed people are particularly at risk. Scammers will typically create fake profiles on dating websites and social media and then strike up conversations with their targets. However, the schemes can also happen in person.

Whether in person or online, they pretend to have feelings for the victim. The fraudster can quickly advance the relationship or develop it more slowly, building the victim’s trust over months. The scammer may pretend they need financial help with something or are in an emergency.

Once they have established a relationship with their victim, they will ask for money in the guise of sending gifts or showing appreciation for the person’s affection. When they get it, the scammer disappears without ever talking to them again.

Signs of Sweetheart Scams

Romance scams are financially and emotionally devastating for victims. Scammers leave a trail of broken hearts and empty wallets. The Federal Trade Commission (FTC) reported a 50% increase in romance scams from 2019 to 2020.

As a financial advisor, you can play a pivotal role in protecting your client’s assets. For example, suppose a client requests an oddly specific cash transfer from a managed account to their personal checking account. The request is for more than $40,000, raising red flags in your mind.

In this instance, you’re able to recognize the transaction as a potential scam. But what about more subtle signs? As you review clients’ financial statements, look for unusual activity:

  • Large transactions not typical for the client.
  • Transfers to international locations.
  • Large ATM withdrawals.
  • Large purchases at locations that provide funds transfers.
  • Using lines of credit or pulling from investments.
  • A new name added to a financial account.

Educate Older Adults About the Dangers

The most important step against sweetheart scams is to stop them before they start. Whether working with a client or communicating with friends or loved ones, develop an open and trusting relationship to show you care for and respect them. A compassionate approach to all communication can help people open up to you and ask questions when facing a questionable financial situation or request.

Contrary to the familiar adage, silence is not golden. Find opportunities to talk to older adults about the signs and dangers of financial scams:

  • For clients, an annual review can be more than an opportunity to reassess their investment and financial situation. It’s also an excellent time to educate your clients on financial warning signs, including romance scams.
  • For family and friends, ask what’s going on in their lives and be an advocate. If they’ve met someone new, use your detective skills to look up the person online and encourage them to meet people in safe, public places.

You can also educate older adults about the specific dangers of a sweetheart scam, such as someone professing their love quickly, asking for money, luring them off the dating site or app where they met, and claiming to need help paying for an emergency, a hospital bill or travel costs to visit them.

Help Your Client Report a Sweetheart Scam

If someone opens up to you about financial fraud, be patient while they share their experience. The victim may already know they’ve been taken advantage of, but you may be the first person to talk with them about the fraud.

Ask open-ended questions to help you understand the scam — but remember, you are not the fraud investigator. Instead, direct the victim to the appropriate agencies and individuals to find support for their recovery. The Financial Industry Regulatory Authority (FINRA) Investor Education Foundation and the National Center for Victims of Crime recommends:

Because financial fraud can take a toll on a victim’s mental and emotional health, you might suggest they contact a trusted mental health counseling center. Agencies can offer low-cost counseling options if the victim needs financial assistance to get the help they need.

Sweetheart Scams Are Anything but Sweet

Sweetheart scams can be devastating for the victim and their friends and families. Even though I coached my mother about strangers, knowing my mom met someone online who tricked her was a heart-wrenching experience for everyone involved.

Victims can be embarrassed to come forward. In my mom’s case, a social worker noticed the fraud in time to stop a wire transfer large enough to potentially jeopardize her financial stability in retirement.

While I encourage clients, friends and family to meet people and stay connected as they age, I don’t shy away from talking about the dangers. Con artists can try to lure clients and loved ones into a web of lies as they pretend to be something they’re not. Monitor your customers’ activity for unusual transactions, learn the signs and become an advocate to protect the vulnerable from predators posing as companions.

In my case, I spent the next 6 months determined to help my mom cover the $15,000 less the wire fees. Somehow, contacting the bank once a month didn’t seem adequate, yet every week seemed too frequent. I designated 12 p.m. to 3 p.m. every other Friday to follow up. It definitely took patience, persistence & perseverance to recover my mom’s funds. Now, I am on a mission to help educate advisors on how to detect and prevent elder financial abuse and financial exploitation among their clients and loved ones.

Marguerita (Rita) Cheng, CFP, is the chief executive officer of Blue Ocean Global Wealth. She is passionate about helping clients navigate some of life’s most difficult issues — divorce, death, career changes, caring for aging relatives — so they can feel confident and in control of their finances. Rita is a regular columnist for Kiplinger and MarketWatch, and a past spokesperson for the AARP Financial Freedom Campaign. Rita volunteers her time as a SoleMate, or charity runner for Girls on the Run, raising money to win scholarships for girls.


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