Pennsylvania lawmakers consider requiring banks to better detect and report elder fraud

CBS News investigates a crime that is targeting the savings of a growing number of Americans. Victims are tricked into transferring money from their bank accounts to scammers overseas. This trend in wire fraud is a challenge for banks whose customers are being targeted.

FBI agents told CBS News Philadelphia that these scammers often target baby boomers who have a lot of money in the bank. However, anyone can fall victim to these elaborate crimes that come in the form of love scamscryptocurrency investments or fear-based schemes.

Internet scams come in all shapes and sizes, but experts say they almost always start with a single bank transfer, sometimes with a simple click or swipe, and hundreds of thousands of dollars can disappear forever.

“Nearly 60 percent of the money stolen started with a wire transfer. No one in the banking industry wants that to happen, but it’s happening and it’s increasing every year,” Nicholas Smyth, chief assistant attorney general for the Pennsylvania Bureau of Consumer Protection, said at a Senate hearing in Harrisburg last week.

According to Smyth, most of the money stolen in financial fraud is never returned. That’s why Pennsylvania Rep. Joe Hogan, a Bucks County Republican, has introduced a bill aimed at preventing these sophisticated global crimes. The bill would require banks to report any suspicious activity, such as a foreign wire transfer, freeze the transaction for a few days and alert law enforcement, who could then investigate. In some cases, trusted family members could also be alerted. It would only apply to Pennsylvanians age 60 and older, under the state’s Elderly Protective Services Act. The bill easily passed the House in July with bipartisan support. It is now before the Senate.

During the hearing, many senators shared stories of constituents, family and friends who fell victim to these financial scams. State Sen. Lisa Baker, a Luzerne County Republican, told the story of an elderly woman who donated $50,000 thinking she was communicating with Phillies player Trea Turner.

Banking experts and former FBI agents also testified.

“The criminal enterprises that are running these scams are very skilled and they are using the best cover stories I have seen,” Richard Cimakasky, chief fraud and security officer at Penn Community Bank, told lawmakers.

Some banking executives have asked senators to weigh the pros and cons of giving banks more tools to protect their customers without overburdening their employees.

The bill still must pass the Pennsylvania Senate and then return to the House for another vote before reaching the governor’s desk.

Hogan said similar legislation has been under discussion for more than 10 years but never passed. He fears time will run out again before this session ends.