THE NEWEST SENIOR SCAM - TELEMARKETING SENIOR LIVING CENTERS

THE NEW ELDER CARE REFERRAL AGENCY PROBLEM

 

The new questionable senior service is the Elder Care Referral Agency (ECRA). The ECRA problem is caused by the misuse of internet advertising, hard sale telephone marketing, and duping seniors. The ECRAs’ goal to make huge profits by finding seniors living facilities and moving the seniors into those referred places. ECRAs have exploded in usage in the past ten years and now represent a $125 million industry. ECRAs are responsible for over 25% of the entire senior living facility placements. It is estimated that in the next two years over 50% of the entire senior living facility placements will be by ECRAs.

 

ECRAs receive a bounty (referral fee) for the placement of people in senior living centers. They can receive ½ month to $6,000 per placement with the average being $3,500 per person. This is the new sweat shop of hard selling telemarketers that are defrauding seniors. Thousands of ECRA Sales Representatives work only by 100% commission and receive an average of $650 per placement. They usually have no inspections of the senior living centers being referred and have no understanding of geriatric needs. The seniors are usually placed in the senior living center that offers the highest fee placement payment (bounty). Some of the ECRA problems that seniors are complaining about are: aggressive telephone sales calls (up to 45 calls a month), being placed in substandard senior living facilities, and the Double Dipping of senior sales which move the seniors from one senior living facility to another several times a year.

 

The largest ECRA is “A Place for Mom” which is in 45 states and has the annual sales of $50 million. A Place for Mom has 300,000 website visitors annually, 50,000 requests for placement assistance, 18,000 senior housing facilities, and 430 sales agents. Washington State just passed the ECRA REGULATION LAW which went into effect this year which forces full disclosure of ECRA fees, properly trained ECRA advisors, inspection of the 18,000 senior living faculties, and ECRA insurance coverage. We have purposed the same ECRA law along with 14 other senior protection laws in order to protect Arizona seniors from abuse and exploitation.

 

The Federal Bureau of Investigations, National White Collar Crime Center, and the Bureau of Justice Assistance have formed a partnership called the IC3 which investigates Cyber Crime. The primary Cyber Crime (internet fraud) is to seniors for the non-delivery of goods and services for health related products and services. The IC3 reported that it had 275,000 complaints in 2011 and that the internet complaints are growing 33% a year. IC3 reports that $264 million is lost by seniors due to internet fraud annually.

 

Seniors need to be aware that they are desired targets of crooks. The crooks biggest weapons are the internet and phone. We recommended in our recent senior abuse and exploitation class to have “Caller Identification” on their phone and not to answer the phone from callers that they do not know. Seniors need to be aware that nothing is free and that the best way to avoid senior abuse and fraud is by prevention. Sources:  Seattle Times, AARP, Huffington Post, Wall Street Journal, IC3, and the Consumer Financial Protection Bureau.