Personal Finance & Estate › Fraud, scams & protecting family › Financial scams & fraud (incl. affinity & Ponzi schemes)
Impostor scams (IRS, SSA, Medicare, 'grandchild in trouble')
· Concept or strategy
Watch outA common mistake, trap or scam.
Scammers pose as the IRS, Social Security, Medicare, police, a bank or a grandchild in trouble to demand fast payment.
See it on the Personal Finance & Estate map →How it works
Calls or texts create panic: unpaid taxes, a 'suspended' Social Security number, a Medicare card problem, a grandchild jailed after an accident. Caller ID is spoofed, and AI can now clone a relative's voice from a short clip. The payment demand is the tell: gift cards, wires, crypto, or cash or gold handed to a courier. Real agencies usually write first and never demand those. Defense: hang up, call back on a number you look up, and agree on a family code word.
Why it matters for you
Impostor scams are the most-reported fraud type, and older adults lose the largest sums, sometimes their entire life savings.
Red flags and protection
The FTC logged nearly $3 billion in impostor losses in 2024, its most-reported category; the IRS's watchdog TIGTA, Social Security's inspector general and the FBI publish warnings and prosecutions.
Watch out for
How fast AI voice cloning and deepfake video will grow these scams, and whether phone carriers can ever stop spoofed caller ID, are open questions.
Connections (4)
▸Impostor scams (IRS, SSA, Medicare, 'grandchild in trouble') are a top form of Financial scams & fraud (incl. affinity & Ponzi schemes)Watch out
How they connect
Impostor scams are the most-reported type of fraud. They use the general scam playbook in its purest form: borrow the authority of an agency, a bank or a relative, create panic, and demand payment by a method that is hard to trace or reverse, such as gift cards, wires or crypto.
When it applies
Nationwide, by phone, text and email; government impersonation surged around 2013 with overseas call centers posing as the IRS, and later as Social Security.
How sure?
FTC Consumer Sentinel data have ranked impostors the top fraud category by reports in recent years, tracking government, business and family-and-friend impostors as subtypes.
Watch out for
Reported figures understate losses, and how much AI voice and video cloning will add has not yet been measured.
▸Impostor scams (IRS, SSA, Medicare, 'grandchild in trouble') impersonate Internal Revenue Service (IRS)Watch out
How they connect
IRS impostors call, text or email claiming unpaid taxes and threatening arrest, deportation or license loss unless payment is made now. The real IRS usually contacts by mail first, allows appeals, and never demands gift cards, crypto or wires by phone.
When it applies
Peaked around 2013–2016, run from call centers near Mumbai; it returns each tax season with texts about 'refunds' and fake IRS letters.
How sure?
The IRS watchdog TIGTA called it the largest IRS impersonation scam it had seen; in 2016 the Justice Department charged 56 people and five Indian call centers.
Watch out for
How much is still lost each year is uncertain; texts and fake letters are harder to trace than the old phone calls.
▸Impostor scams (IRS, SSA, Medicare, 'grandchild in trouble') impersonate Social Security Administration (SSA)Watch out
How they connect
Social Security impostors claim the victim's number is 'suspended' or tied to a crime, then demand money to 'protect' it, or ask for the number and bank details. SSA does not suspend numbers, threaten arrest, or demand payment by gift card, wire, crypto or cash.
When it applies
Surged by robocall around 2019–2020 and continues by text and email; SSA's inspector general holds a national 'Slam the Scam' day each March.
How sure?
FTC data show Social Security impostors overtook IRS impostors in reports in 2019; SSA's inspector general documents cases and prosecutions.
Watch out for
Whether the caller-ID authentication rules phone carriers had to adopt in 2021 (STIR/SHAKEN) have meaningfully cut these calls is debated.
▸Impostor scams (IRS, SSA, Medicare, 'grandchild in trouble') are a common form of Elder financial abuseWatch out
How they connect
Impostor scams hit older adults hardest in dollars: retirees have savings, answer the phone, and may be isolated or trusting of authority. Grandparent and 'bank fraud department' calls can strip life savings in days, often through cash or gold handed to a courier. Family can help with call blocking, a code word and a trusted contact.
When it applies
Nationwide, rising since 2020; in 2024 the FBI warned of couriers collecting cash and gold from seniors at their homes.
How sure?
FTC data show older adults are less likely to report losing money but report higher median losses; the FBI counted about $4.9 billion in losses by people 60 and older in 2024.
Watch out for
Whether banks should be required to stop suspicious transfers by older customers, and who should bear the losses, is under debate.